Benchmarks trades in green in late morning session

Indian equity benchmarks added gains and were trading in green in the late morning session on account of buying in frontline blue chip counters. The sentiments were on optimistic note on reports that Odisha become the 16th state to ratify the constitutional amendment bill passed by Parliament to introduce the goods and services tax (GST), helping cross the important threshold of more than half the number of states needed for the proposed law to be sent for presidential assent. Additional buying crept in after International Monetary Fund (IMF) in its surveillance note stated that Indian economy is likely to continue to grow strongly, crediting its latest assessment to support from private consumption and saying that the goods and services tax will provide a further boost when it is rolled out. The assessment comes a day after India reported a muted 7.1% growth in the first quarter of 2016-17, down from 7.9% in the previous quarter and the slowest in five quarters. Traders were seen piling position in Realty, Consumer Durables and Auto stocks, while selling was witnessed in Metal, IT and TECK sector stocks. In scrip specific development, mixed reaction were displayed among sugar stocks, as to check spiraling price of sugar which has crossed Rs 40 per kg, the government imposed stock limits on sugar mills during the festival season till October-end.

On the global front, Asian stocks were relatively subdued ahead of highly-anticipated US jobs data later today and as investors continued to digest yesterday’s batch of global manufacturing data. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 8,750 and 28,400 levels respectively. The market breadth on BSE was positive in the ratio of 1282:840, while 111 scrips remained unchanged.

The BSE Sensex is currently trading at 28464.22, up by 40.74 points or 0.14% after trading in a range of 28428.35 and 28525.87. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.38%, while Small cap index was up by 0.44%.

The top gaining sectoral indices on the BSE were Realty up by 1.11%, Consumer Durables up by 0.76%, Auto up by 0.73%, Bankex up by 0.33% and FMCG up by 0.17%, while Metal down by 0.86%, IT down by 0.33%, TECK down by 0.33%, Oil & Gas down by 0.15% and Power down by 0.14% were the losing indices on BSE.

The top gainers on the Sensex were Adani Ports & Special Economic Zone up by 3.42%, Maruti Suzuki up by 2.13%, Tata Motors up by 1.86%, HDFC up by 1.14% and Asian Paints up by 0.92%.

On the flip side, Reliance Industries down by 1.87%, Coal India down by 1.82%, Bajaj Auto down by 1.69%, Power Grid Corporation down by 0.57% and Infosys down by 0.55% were the top losers.

Meanwhile, the country will require 10% surplus rainfall or more than 190 mm in month of September for 2016-17 to cover the deficit, as most part of India experienced a dry rainfall in month of August.  India Meteorological Department (IMD) has said that the season's total rainfall from June 1 to August 31 was 3% below average at 693.1 mm, usually the country receives an average 890 mm of rainfall during the June-September monsoon.

IMD further said that there has been a decrease in rainfall over northwest and adjoining central India, indicating that the south west monsoon is withdrawing. Monthly rainfall in the country so far has been mixed, with a deficit of 11% in June, followed by a 7% excess in July and a 9% shortfall in August, the rainfall deficit in the month of August was 9% at 237.1mm. The country has had a shortfall of rain in the month of August since 2013. The country receives the maximum rainfall in the months of July and August, before the monsoon starts retreating from west Rajasthan in the first week of September.

According to IMD, this year's monsoon would be above average, after two consecutive years of deficit rainfall. Based on this they stick to their prediction that rainfall over the country as a whole is likely to be 106% of the average, with a model error of ±4%. IMD further said that the country has been receiving good rains therefore heavy rains are not required as it will not be good for crops. IMD expected that heavy rains will continue four days to September 5, at few places in east northeast and south India, including West Bengal, Sikkim, Arunachal Pradesh, Assam, Meghalaya, coastal Karnataka and Kerala. Adequate monsoon rainfall is crucial in India, where more than half the farmland is dependent on rainfall for irrigation.

The CNX Nifty is currently trading at 8778.70, up by 4.05 points or 0.05% after trading in a range of 8770.10 and 8798.45. There were 19 stocks advancing against 31 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were Adani Ports & Special Economic Zone up by 3.50%, Maruti Suzuki up by 2.16%, Tata Motors up by 1.92%, Tata Motors - DVR up by 1.63% and HDFC up by 0.94%.

On the flip side, Idea Cellular down by 2.51%, Coal India down by 1.89%, Reliance Industries down by 1.87%, Bajaj Auto down by 1.69% and Hindalco down by 1.52% were the top losers.

The Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 0.77 points or 0.05% to 1,671.32, KOSPI Index increased 5.56 points or 0.27% to 2,038.28, Jakarta Composite increased 11.08 points or 0.21% to 5,345.63 and Hang Seng increased 103.39 points or 0.45% to 23,265.73.

On the other hand, Nikkei 225 decreased 39.86 points or 0.24% to 16,886.98, Taiwan Weighted decreased 14.98 points or 0.17% to 8,986.17 and Shanghai Composite decreased 0.07 points or 0% to 3,063.23.