Benchmarks continue firm trade; Realty, Auto lead

Indian equity markets continued their firm trade in noon session on back of buying in Realty, Auto, Consumer Durables, FMCG and Banking counters.  Sentiments remained upbeat with the report that Odisha became 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.  Some support also came with chief economic advisor Arvind Subramanian stating that India has the potential to sustain 8 to 10 percent GDP growth rate during the next two to three years, despite April-June GDP growth coming in below expectations at 7.1 percent. However, traders remained a bit cautious too ahead of US non-farm payrolls data, which will be released later today. In scrip specific development, Lupin gained 1 percent after receiving tentative approval from the U.S. Food and Drug Administration for an anti-bacterial drug while Dr Reddy's Laboratories slid half a percent on news it would redesign the packaging of its popular generic brands. 

On the global front, Asian markets were trading mixed as traders awaited the latest U.S. jobs report, the strength of which could help determine the timing of the next interest-rate increase. Back home, the BSE Sensex is currently trading at 28462.28, up by 38.80 points or 0.14% after trading in a range of 28428.35 and 28525.87. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.36%, while Small cap index added 0.37%.

The top gaining sectoral indices on the BSE were Realty up by 1.03%, Auto up by 0.95%, Consumer Durables up by 0.51%, FMCG up by 0.33% and Bankex up by 0.23%, while Metal down by 1.00%, Capital Goods down by 0.41%, IT down by 0.27%, TECK down by 0.22% and Oil & Gas down by 0.17% were the losing indices on BSE.

The top gainers on the Sensex were Adani Ports & SEZ up by 2.70%, Maruti Suzuki up by 2.07%, Tata Motors up by 1.54%, Asian Paints up by 0.95% and Lupin up by 0.86%. On the flip side, Coal India down by 1.85%, Reliance Industries down by 1.80%, Larsen & Toubro down by 0.84%, Hindustan Unilever down by 0.65% and Cipla down by 0.58% were the top losers.

Meanwhile, the government has imposed stock limits on sugar mills during September and October, 2016 to prevent further rise in sugar prices during upcoming festival season, as retail sugar prices has crossed Rs 40 per kg. This decision will boost availability of sugar in open market and help to control the price rise. This is the first time that the government has imposed limit on the Rs 80,000-crore sugar industry ever since it was partially decontrolled in 2013.

Food and Consumer Affairs Minister Ram Vilas Paswan said that the stock limit on sugar at the end of September 2016 is 37% of the total sugar available with sugar mills during 2015-16 sugar season, while the stock limit on sugar at the end of October, 2016 is 24% of the total sugar available with sugar mills during 2015-16 sugar season. He further said that fresh crushing of sugarcane starts by October end and new sugar reaches market in November. Therefore, the stock limits have been imposed for only two months. He added that anyone found holding more stock will be treated as an offence and government will take action.

The domestic production has decreased by 11.31% to 25.1 million tonnes in the current 2015-16 marketing year as compared to 28.3 million tonnes in the last year, this resulted in rise in sugar prices. Retail prices of sugar is ruling at Rs 42 per kg in the national capital, while in some locations the prices is as high as Rs 52 per kg. Besides, the outlook for the next 2016-17 marketing year is also not very encouraging, industry body Indian Sugar Mills Association (ISMA) anticipates sugar output to fall to 23.26 million tonnes, while it feels that there would be sufficient supply to meet the domestic demand. Recently, the government has imposed 20% export duty on sugar.

The CNX Nifty is currently trading at 8780.85, up by 6.20 points or 0.07% after trading in a range of 8770.10 and 8798.45. There were 28 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were Adani Ports &Special up by 2.61%, Tata Motors - DVR up by 2.03%, Maruti Suzuki up by 2.02%, Tata Motors up by 1.54% and Bank of Baroda up by 1.49%. On the flip side, Idea Cellular down by 3.17%, Reliance Industries down by 1.86%, Coal India down by 1.79%, Hindalco down by 1.37% and ACC down by 1.17% were the top losers.

Asian markets were trading mixed; FTSE Bursa Malaysia KLCI increased 0.58 points or 0.03% to 1,671.13, KOSPI Index was up by 5.59 points or 0.28% to 2,038.31, Jakarta Composite added 11.08 points or 0.21% to 5,345.63 and Hang Seng rose107.04 points or 0.46% to 23,269.38. On the flip side, Taiwan Weighted decreased 13.6 points or 0.15% to 8,987.55, Nikkei 225 declined 1.16 points or 0.01% to 16,925.68 and Shanghai Composite was down by 0.42 points or 0.01% to 3,062.89.