Benchmarks pare gains but trade continues in green

Indian equities pared most of their early gains but managed to trade in green in the afternoon session, even as Asian markets slipped from 19-month high. Sentiments got some support with RBI Governor Urjit Patel’s statement that faster remonetisation and return of discretionary consumer demand will push economic activity in the latter part the fiscal. Patel, during the two-day Monetary Policy Committee meeting on February 7-8, also said that shifting monetary policy stance from accommodative to neutral will provide sufficient flexibility to move the policy rate in either direction. Besides, short-covering of outstanding positions ahead of last session of February series expiry in the derivatives segment too supported the market. Meanwhile, rupee strengthened by 11 paise to 66.85 against the dollar in early trade at the Interbank Foreign Exchange on increased selling of the US currency by exporters and banks. However, gains remained capped with International Monetary Fund’s (IMF) statement that India’s growth is projected to slow to 6.6 percent in 2016-17 fiscal due to the strains that have emerged in the economy as a result of ‘temporary disruptions’ caused by demonetization. In scrip specific development, Tata Communications was trading in green after entering into the global $4 billion mobile data connectivity and cross-border Internet of Things market.

On the global front, Asian markets were trading mostly in red, following the mixed cues overnight from Wall Street after minutes of US Federal Reserve's last monetary policy suggested many policymakers believe interest rates should be increased ‘fairly soon’.

The BSE Sensex is currently trading at 28932.80, up by 68.09 points or 0.24% after trading in a range of 28904.34 and 28989.65. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.40%, while Small cap index was up by 0.32%.

The top gaining sectoral indices on the BSE were Telecom up by 4.06%, TECK up by 1.81%, Consumer Durables up by 1.48%, IT up by 1.45% and Realty up by 0.70%, while Energy down by 0.54%, Oil & Gas down by 0.25%, Power down by 0.25%, Utilities down by 0.20% and Auto down by 0.05% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 4.82%, TCS up by 2.23%, Infosys up by 1.57%, Wipro up by 1.10% and Sun Pharma up by 0.98%. On the flip side, Reliance Industries down by 1.39%, Axis Bank down by 0.82%, NTPC down by 0.72%, ICICI Bank down by 0.65% and Power Grid down by 0.55% were the top losers.

The Cabinet Committee on Economic Affairs, headed by the Prime Minister Narendra Modi, has given approval for enhancement of solar power generation capacity from 20,000 MW to 40,000 MW under the scheme for development of Solar Parks and Ultra Mega Solar Power Projects (UMSPP). The scheme which will lead to setting up of 50 solar parks each with a capacity of at least 500 MW and above in various parts of the country. The capacity of the solar park scheme has been enhanced after considering the demand for additional solar parks from the States. 

The Solar Parks and UMSPPs will be set up by 2019-20 with Central Government financial support of Rs 8100 crore. The total capacity when operational will generate 64 billion units of electricity per year which will lead to abatement of around 55 million tonnes of CO2 per year over its life cycle. Further, smaller parks in Himalayan and other hilly States where contiguous land may be difficult to acquire in view of the difficult terrain, will also be considered under the scheme.

Meanwhile, the solar parks will contribute to long term energy security of the country and promote ecologically sustainable growth by reduction in carbon emissions and carbon footprint, as well as generate large direct & indirect employment opportunities in solar and allied industries like glass, metals, heavy industrial equipment etc. It will also provide productive use of abundant uncultivable lands which in turn facilitate development of the surrounding areas.

The CNX Nifty is currently trading at 8951.65, up by 24.75 points or 0.28% after trading in a range of 8935.40 and 8965.10. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Idea Cellular up by 7.28%, Bharti Airtel up by 4.85%, TCS up by 2.13%, Infosys up by 1.74% and HCL Tech. up by 1.29%. On the flip side, Grasim Industries down by 1.54%, Reliance Industries down by 1.38%, Axis Bank down by 1.00%, Bosch down by 0.86% and Eicher Motors down by 0.85% were the top losers.

The Asian markets were trading mostly in red; Hang Seng decreased 105.52 points or 0.44% to 24,096.44, Shanghai Composite shed 19.89 points or 0.61% to 3,241.33, Taiwan Weighted declined 9.47 points or 0.1% to 9,769.31, Nikkei 225 was down by 8.41 points or 0.04% to 19,371.46 and FTSE Bursa Malaysia KLCI slipped 1.52 points or 0.09% to 1,706.56.

On the flip side, KOSPI Index increased 1.02 points or 0.05% to 2,107.63 and Jakarta Composite was up by 5.7 points or 0.11% to 5,364.38.