Markets managed a positive close after a volatile session; Sensex recapture 28400 mark

Indian equity markets traded on a sluggish note for most part of the session, but once again managed to eke out modest gains by the end of trade, as the benchmark indices clawed back into the green terrain in the last on getting some supportive leads from the European markets. Sentiments also got some support with report that Prime Minister Narendra Modi has reviewed preparations for roll out of the new Goods and Services Tax (GST) regime, possibly from April 1 next year, with Finance Minister Arun Jaitley and his team making a presentation on the milestones achieved and the road ahead. Adding the optimism among investors, Agriculture Minister Radha Mohan Singh said the country’s foodgrain output is expected to touch a record in the ongoing 2016-17 crop year. The government has set a target to achieve a record foodgrains production of 270.10 MT this year.

Though, several market participants seems to have adopted a wait-and-watch approach to the global sentiment which is playing between cautious and optimism over the FOMC meet early next week. Currently, FII's are sellers in the market which also signals of a pause in the liquidity driven market. Foreign institutional investors were net sellers in equities worth Rs 477 crore on September 14, 2016. Meanwhile, shares of tyre manufacturers outperformed the market on expectation that falling natural-rubber prices will help boost margins. Domestic natural rubber prices have corrected by about 11 percent over the last two months. Most of the IT stocks edged higher after a report that the commerce ministry will propose devaluation in the rupee to promote dwindling exports. Many stocks specific activities were seen during the session BEML slumped over 12 percent after the company's net loss increased to Rs 107 crore for the quarter ended June 30, 2016, due to lower operational income. Further, shares of Ashok Leyland declined over 3 percent and Hinduja Foundries slumped around 20 percent after the board of both these companies approved the proposal of amalgamating Hinduja Foundries with Ashok Leyland.

On the global front, most of the Asian markets remained under pressure during the session as investors grapple with the apparently diminishing ability of major central banks to stimulate growth, while a tumble in crude oil prices added to the risk-averse mood. Expectations over a Federal Reserve rate hike at next week's meeting have faded and investors are bracing for a tightening before year-end. Japanese shares led regional losses to close at their lowest levels in nearly three weeks, as the yen held strong against its peers on skepticism over BOJ's further easing at next week's meeting. Meanwhile, European markets edged higher in early trade, looking to break off from a week-long losing run, as investors awaited a batch of economic data for clues on the strength of the world’s biggest economy and the trajectory of interest rates before next week’s Federal Reserve meeting.

Back home, after getting a firm start, the local benchmark indices slipped in negative territory in late morning session as investors turned jittery tracking weak Asian cues and overnight losses on Wall Street after crude oil prices eased. Thereafter, the frontline indices traded in tight range near neutral line, altering between positive and negative territory, for most part of the session due to lack of encouraging leads. However, some lower level buying in frontline blue-chip stocks along with supportive leads from European markets helped the indices to end the session on optimistic note. Finally, the NSE’s 50-share broadly followed index Nifty, got buttressed by around quarter of a percent to settle around the crucial 8,750 support level, while Bombay Stock Exchange’s sensitive Index-Sensex accumulated over forty points and closed above the psychological 28,400 mark. On the BSE sectoral space, FMCG counter remained the top gainer in the space with over half a percent gains followed by the Healthcare index which ended with similar gains. On the other hand, the Consumer Durables index slipped by around a percent followed by Power and PSU counters which too settled with over half a percent losses.

The market breadth remained optimistic as there were 1471 shares on the gaining side against 1258 shares on the losing side while 197 shares remained unchanged.

Finally, the BSE Sensex ended up by 40.66 points or 0.14% to 28412.89, while the CNX Nifty gained 15.95 points or 0.18% to 8,742.55. 

The BSE Sensex touched a high and a low 28454.02 and 28311.11, respectively. There were 13 stocks advancing against 17 stocks declining on the index. The broader indices ended mixed; the BSE Mid cap index declined 0.25%, while Small cap index was up by 0.27%.

The top gaining sectoral indices on the BSE were FMCG up by 0.66%, Realty up by 0.14%, TECK up by 0.08% and Capital Goods up by 0.01%, while Consumer Durables down by 0.97%, Power down by 0.94%, PSU down by 0.69%, Bankex down by 0.58% and Auto down by 0.38% were the top losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 1.63%, Maruti Suzuki up by 1.47%, Cipla up by 1.35%, ITC up by 1.23% and HDFC up by 1.19%. On the flip side, Power Grid down by 2.40%, Axis Bank down by 2.25%, Hero MotoCorp down by 1.86%, Tata Steel down by 1.83% and Bajaj Auto down by 1.78% were the top losers.

Meanwhile, in order to ensure faster movement of cargo, the government is planning to come up with a Rs 3 lakh crore Economic Corridor project to develop 35,000 km of highways. The project is aimed at faster movement of cargo and would not only under developing economic corridors with a length of about 21,000 km but also developing 14,000 km of feeder routes, i.e. providing connectivity to logistic hubs.

The economic corridors projects include Mumbai-Cochin-Kanyakumari, Bangalore-Mangalore, Hyderabad-Panji and Sambalpur-Ranchi etc and it is planned to overtake Ministry's National Grid Project where NHAI has prepared a plan for grid connectivity through 27 horizontal and vertical highways. Once completed the economic corridors would reduce the travel time and result in reduction in logistics costs.

This would be the biggest highway expansion plan after the flagship road building programme of National Highways Development Project (NHDP) which saw development of 50,000 km of National Highways network as per global standards including the Golden Quadrilateral project. The Golden Quadrilateral project aims at connecting all four metropolises and North-South Corridor connecting Srinagar to Kayakumari and East-West Corridor joining Porbandar to Silchar.

The economic corridors projects will improve freight movement by reducing distance and travel time, ease traffic bottlenecks and improve inter-city connectivity and it will also open up neglected regions of the country such as the north-east.  

The CNX Nifty traded in a range of 8,751.95 and 8,704.35. There were 27 stocks advancing against 24 decliners on the index.

The top gainers on Nifty were BHEL up by 2.70%, Zee Entertainment up by 2.33%, Reliance Industries up by 1.92%, Maruti Suzuki up by 1.64% and ITC up by 1.59%. On the flip side, Yes Bank down by 2.31%, Power Grid down by 2.04%, Tata Steel down by 2.03%, Axis Bank down by 1.96% and Bajaj-Auto  down by 1.41% were the top losers.

The European markets were trading in green; UK’s FTSE 100 increased 20.21 points or 0.3% to 6,693.52, Germany’s DAX increased 33.58 points or 0.32% to 10,411.98 and France’s CAC increased 2.07 points or 0.05% to 4,372.33.

The Asian markets ended mostly in red on Thursday as a mixed lead from Wall Street and the oil price downturn kept investors nervous, heading into key central bank meetings. The Bank of England and the US Federal Reserve are expected to keep rates on hold, while economists remain divided over what the Bank of Japan will do at the end of its two-day policy meeting next week. Japanese shares led regional losses to close at their lowest levels in nearly three weeks, as the yen held strong against its peers on skepticism over BOJ's further easing at next week’s meeting. The markets in China, South Korea and Taiwan were closed for public holidays.