Benchmarks trade slightly in green in early deals

Indian equity benchmarks have made a cautious but positive start and are trading slightly in green in early deals on Thursday, as traders took some encouragement with Minister for Road Transport and Shipping Nitin Gadkari’s statement, who showcasing India's growth story before global business leaders at WEF annual meeting, said it is the appropriate time to invest in the country and added that the country is also working on ways to improve purchasing power of common men as that will present further opportunities. However, gains remained capped as some cautiousness crept in with US Fed Chair Janet Yellen sparking rate hike fear.

On the global front, Asian markets were trading mostly in red at this point of time tailing weak overnight cues from Wall Street, though the Japanese market has bounced back with yen falling against the dollar after Janet Yellen said the American economy is strong enough to warrant higher interest rates. The US markets showed a lackluster trade and ended mixed in last session, mainly due to uncertainty about President-elect Donald Trump's policies ahead of his inauguration on Friday.

Back home, foreign investors turned net buyers and bought equities worth Rs 319.14 crore, while domestic investors also bought equities worth Rs 245.03 crore on January 18, 2017. Stocks of electronic manufacturing companies remained in focus, as the Cabinet has approved the modified version of a key scheme that incentivizes electronics manufacturing in the country.

The market breadth indicating the overall health of the market was strong, with 1,072 shares gaining and 910 shares declining, while a total of 125 shares were unchanged.

The BSE Sensex is currently trading at 27276.67, up by 19.03 points or 0.07% after trading in a range of 27219.89 and 27296.86. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.26%, while Small cap index was up by 0.21%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 1.10%, Consumer Durables up by 0.72%, PSU up by 0.34%, FMCG up by 0.31% and Capital Goods was up by 0.23%, while Metal down by 0.73%, Bankex down by 0.42%, Power down by 0.17% and IT was down by 0.01% were the few losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 1.54%, Adani Ports &Special up by 1.30%, Bharti Airtel up by 1.26%, GAIL India up by 0.97% and ONGC was up by 0.78%. On the flip side, Axis Bank down by 1.24%, Tata Steel down by 0.87%, HDFC down by 0.59%, Mahindra & Mahindra down by 0.55% and Bajaj Auto was down by 0.53% were the top losers.

Meanwhile, global rating agency Standard and Poor’s (S&P) in its latest report on Indian companies has said that to overcome uncertainties from global geopolitical changes and domestic policy-making, strong domestic demand and cost competitiveness in exports will help Indian companies. It also said that faster economic growth as well as reforms will make India a good macroeconomic story and this coupled with the stable credit profile of companies, bodes well for foreign currency bonds by Indian issuers.

In its 'India Corporate Outlook 2017', S&P said that healthy economic growth and falling interest rates should also benefit companies in the country. It added that while Indian companies are better placed than their global peers, they believe their ability to manage capital expenditure and quickly adjust to ongoing structural reforms in the country is crucial. However, it said that the key risk to revenue growth for the current fiscal is a short-term fall in demand due to the demonetisation-related cash crunch and the proposed introduction of a goods and services tax may pose a similar risk for fiscal 2018.

The report said that outlook for most of the 26 Indian companies S&P rates is stable over the next 12-24 months, but global companies are constrained by slow growth in the developed economy and global trade, rising protectionist measures and increasing interest rates. S&P said that it expects a revival in demand and completion of projects to support strong revenue growth and deleveraging for domestically-focused Indian companies (such as those in the utilities, infrastructure and telecom sectors) in the next 12-24 months. It also expects potential challenges in export-focused sectors such as pharmaceuticals and information technology (IT) services from increasing regulations, protectionism, and competition globally.

The CNX Nifty is currently trading at 8417.90, up by 0.90 points or 0.01% after trading in a range of 8405.95 and 8427.90. There were 24 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were Idea Cellular up by 2.37%, BPCL up by 1.70%, Tata Motors up by 1.58%, Tata Motors - DVR up by 1.49% and Bharti Airtel up by 1.19%. On the flip side, Hindalco down by 1.58%, Ultratech Cement down by 1.16%, Axis Bank down by 1.14%, Tata Steel down by 1.04% and Indusind Bank down by 0.84% were the top losers.

Asian markets were trading mostly in red; Hang Seng declined 136.27 points or 0.59% to 22,961.99, Taiwan Weighted shed 15.82 points or 0.17% to 9,326.15, Shanghai Composite slipped 1.81 points or 0.06% to 3,111.20, FTSE Bursa Malaysia KLCI dipped 1.26 points or 0.08% to 1,663.76 and KOSPI Index was down by 0.1 points or 0% to 2,070.44.

On the flip side, Jakarta Composite rose 7.49 points or 0.14% to 5,302.27 and Nikkei 225 was up by 134.58 points or 0.71% to 19,028.95.