Benchmarks trade jubilantly on easing Geo-political worries

Indian equity benchmarks have made a gap-up opening and are trading jubilantly in early deals with frontline gauges recapturing their crucial 28,100 (Sensex) and 8,700 (Nifty) bastions. Sentiments remained up-beat on report that Pakistan agreed to reduce escalating tension on Line of Control (LoC). Traders took some encouragement with India’s core sector output rising to 3.2% in August on the back of sharp rise in steel production and a pickup in cement, suggesting a lift in infrastructure and construction activity. Steel production rose 17% to a 37-month high, aided by the low base of last year. Some support also came with report that foreign investors making it the highest net inflow in 11 months, pumped in more than Rs 20,000 crore into the capital market in September.

Asian markets too were providing much needed support to the domestic markets with Asian counters rallying at this point of time on ebbing concern about Deutsche Bank AG’s finances, though many of the markets in the region are closed today. The US markets too ended in green on Friday after the recovery in German lender and oil prices.

Back home, stocks of public sector oil marketing companies (OMCs) remained on buyers’ radar on report that the government is preparing a plan for big-ticket asset sales that involves the disposal of controlling stakes in 22 listed and unlisted companies as the Centre looks to meet the full-year disinvestment target of Rs 56,500 crore. Power, fertilizer and CNG suppliers too remained in focus, as price of natural gas for these sectors have been cut by 18 percent to $2.5 per million British thermal unit, it’s the fourth reduction in 18 months.

The BSE Sensex is currently trading at 28143.04, up by 277.08 points or 0.99% after trading in a range of 27919.89 and 28145.60. There were 26 stocks advancing against 4 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index surged 1.47%, while Small cap index was up by 1.74%.

The top gaining sectoral indices on the BSE were Auto up by 2.20%, Realty up by 2.11%, Metal up by 1.74%, Industrials up by 1.55% and Healthcare up by 1.55%, while IT down by 0.43% and TECK down by 0.16% were the only losing indices on BSE.

The top gainers on the Sensex were Maruti Suzuki up by 3.61%, Adani Ports &Special up by 2.82%, Hero MotoCorp up by 2.51%, Tata Steel up by 2.22% and Mahindra & Mahindra up by 2.21%. On the flip side, TCS down by 0.92%, Infosys down by 0.78%, ONGC down by 0.43% and Wipro down by 0.30% were the top losers.

Meanwhile, growth in eight core sectors - coal, crude oil, natural gas, refinery products, fertilizer, steel, cement and electricity, which comprise nearly 38% of the weight of items included in the Index of Industrial Production (IIP), rose to 3.2% in August compared with 2.6% in the corresponding month last year, on back of rise in steel production and growth in fertilizer sector. Core sectors cumulative growth during April to August, 2016-17 was 4.5 %.

As per the data of Ministry of Commerce & Industry, the combined Index of Eight Core Industries stood at 176.0 in August, 2016, 3.2% higher compared to the index of August, 2015. Among the eight sectors that make up the core sector. Steel production having weight of 6.68% surged by 17.0% to 37 month high in August, 2016 over August, 2015 aided by the low base of last year. Its cumulative index during April to August, 2016-17 increased by 4.4% over the corresponding period of previous year. Fertilizer production having weight of 1.25% jumped by 5.7% in August, 2016 over August, 2015. Its cumulative index during April to August, 2016-17 increased by 6.4% over corresponding period of previous year.

Petroleum Refinery production having weight of 5.94%, rose by 3.5% in August, 2016 over August, 2015. Its cumulative index during April to August, 2016-17 increased by 7.6% over the corresponding period of previous year. Cement production having weight of 2.41% increased by 3.1% in August, 2016 over August, 2015. Its cumulative index during April to August, 2016-17 increased by 4.4% over the corresponding period of previous year. Electricity generation having weight of 10.32% increased by 0.1% in August, 2016 over August, 2015. Its cumulative index during April to August, 2016-17 increased by 5.7% over the corresponding period of previous year.

On other hand, the Natural Gas production having weight of 1.71% dropped by 5.7% in August, 2016 over August, 2015. Its cumulative index during April to August, 2016-17 declined by 4.2% over the corresponding period of previous year. Crude Oil production having weight of 5.22% decreased by 3.9% in August, 2016 over August, 2015. Its cumulative index during April to July, 2016-17 declined by 3.1% over the corresponding period of previous year. Coal production having weight of 4.38% decreased by 9.2% in August, 2016 over August, 2015, while its cumulative index during April to August, 2016-17 increased by 2.6% over the corresponding period of previous year.

The CNX Nifty is currently trading at 8,701.00, up by 89.85 points or 1.04% after trading in a range of 8635.00 and 8701.15. There were 45 stocks advancing against 6 stocks declining on the index.

The top gainers on Nifty were Maruti Suzuki up by 3.69%, Adani Ports &Special up by 2.98%, Mahindra & Mahindra up by 2.67%, Hero MotoCorp up by 2.65% and Eicher Motors up by 2.59%. On the flip side, TCS down by 0.98%, Infosys down by 0.53%, Wipro down by 0.51%, HCL Tech. down by 0.17% and ONGC down by 0.08% were the top losers.

Asian markets were trading in green; Jakarta Composite surged 57.38 points or 1.07% to 5,422.18, Taiwan Weighted gained 68.29 points or 0.74% to 9,235.14, Nikkei 225 increased 164.02 points or 1% to 16,613.86 and Hang Seng was up by 289.07 points or 1.24% to 23,586.22.