Markets continue to trade in positive terrain

Indian equity indices continued their positive trade in late afternoon session amid firm trade in Asian and European markets. Sentiments remained cautious over concern of India’s demonetisation move estimated to pulling down gross domestic product growth this financial year from last year’s 7.6 per cent. The domestic rating agency, ICRA has forecasted a 40 bps dip in growth rate to 7.2 per cent in the second quarter of the current fiscal, citing debilitating impact of the demonetisation drive on the economy. On the global front, European shares were trading in green after jump in oil prices helped lift Wall Street stocks to a record high overnight. Back home, in scrip specific development, Vedanta surged over 4 percent after the company received board’s approval to raise Rs 300 crore through issue of secured redeemable non-cumulative non-convertible debentures (NCDs) of face value of Rs 10 lakh each.

The BSE Sensex is currently trading at 25876.04, up by 110.90 points or 0.43% after trading in a range of 25765.51 and 26039.70. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.57%, while Small cap index was up by 0.18%.

The top gaining sectoral indices on the BSE were Metal up by 2.18%, Oil & Gas up by 0.96%, Auto up by 0.87%, FMCG up by 0.74% and Consumer Durables up by 0.65%, while Capital Goods down by 0.97%, Power down by 0.91% and Realty down by 0.10% were the losing indices on BSE.

The top gainers on the Sensex were Hindustan Unilever up by 2.53%, Hero MotoCorp up by 2.28%, Bajaj Auto up by 2.07%, Maruti Suzuki up by 1.88% and HDFC up by 1.87%. On the flip side, Larsen & Toubro down by 1.39%, GAIL India down by 1.11%, SBI down by 0.95%, NTPC down by 0.90% and Power Grid down by 0.84% were the top losers.

Meanwhile, in a meeting with Minister for Commerce and Industry Nirmala Sitharaman, exporters have expressed anxiety over a possible fall in output over the past week due to the government’s demonetisation drive. The exporters voiced their short-term difficulty that they were facing and said that a segment of their activity like procurement of raw material is happening to a large extent in cash, and demanded an increase in the withdrawal limit from Rs 50,000 a week to up to Rs 5 lakh.

Sitharaman assured them that she would take up their demand of enhancing the cash withdrawal limit with the Finance Minister Arun Jaitley so that quick remedial solutions are offered. She also noted that in labour intensive sectors like carpet and handloom, working is dependent on cash withdrawal so they are demanding to increase the limit.  She added that others felt that this month's output might have a bearing because of this cash limit. She further said that due to lack of cash, some of exporters preferred closing down the units partially and some of them were reducing the production capacity from 100% to 30%-40%.

On November 8, 2016, the government had declared demonetisation of Rs 500 and Rs 1,000 note replacing them with new Rs 500 and Rs 2,000 notes to curb corruption and make efforts to recover ‘black’ or unaccounted money.

The CNX Nifty is currently trading at 7972.75, up by 43.65 points or 0.55% after trading in a range of 7938.15 and 8018.45. There were 37 stocks advancing against 14 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 4.48%, Zee Entertainment up by 3.23%, Hindustan Unilever up by 2.79%, Hero MotoCorp up by 2.35% and Grasim Industries up by 2.28%. On the flip side, BHEL down by 3.80%, Larsen & Toubro down by 1.38%, GAIL India down by 1.25%, NTPC down by 1.03% and Power Grid down by 0.84% were the top losers.

All the Asian markets were trading in green; FTSE Bursa Malaysia KLCI increased 3.44 points or 0.21% to 1,630.72, KOSPI Index surged 17.42 points or 0.89% to 1,983.47, Shanghai Composite rose 30.2 points or 0.94% to 3,248.35, Jakarta Composite climbed 36.71 points or 0.71% to 5,185.03, Nikkei 225 advanced 56.92 points or 0.31% to 18,162.94, Taiwan Weighted jumped 92.28 points or 1.02% to 9,133.39 and Hang Seng was up by 320.29 points or 1.43% to 22,678.07.

All the European markets were trading in green; France’s CAC rose 35.06 points or 0.77% to 4,564.64, UK’s FTSE 100 increased 53.8 points or 0.79% to 6,831.76 and Germany’s DAX was up by 68.65 points or 0.64% to 10,753.78.