Markets continue to trade in green in noon session

Benchmark equity indices continued to trade in green in noon session, following sustained buying in Oil & Gas, Industrials, Energy, Metal and Capital Goods sectors amid positive Asian cues. Sentiments remained positive with Finance Minister Arun Jaitley’s statement that India’s GDP can grow by 7-8 percent if the global economy picks up. He also said the government is hopeful of implementing the Goods and Service Tax (GST) from July 1 to help check tax evasion. In scrip specific development, Hindustan Zinc (HZL) rose over 3 per cent after the company announced a special dividend of Rs 13,985 crore for 2016-17, taking the aggregate amount paid by it for the fiscal to Rs 27,157 crore, the largest such payout by any company in the country.

On the global front, Asian markets were trading in green, following positive Wall Street performance overnight. However, Investors remained cautious ahead of a vote on US health care later in the day that could be a barometer for future Trump administration’s policies. Back home, the BSE Sensex is currently trading at 29265.49, up by 97.81 points or 0.34% after trading in a range of 29198.08 and 29315.18. There were 24 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.76%, while Small cap index was up by 0.90%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 1.34%, Industrials up by 1.20%, Energy up by 1.12%, Metal up by 1.05% and Capital Goods up by 1.05%, while FMCG down by 0.14% was the sole losing index on BSE.

The top gainers on the Sensex were Tata Motors up by 2.58%, GAIL India up by 1.88%, Wipro up by 1.52%, NTPC up by 1.40% and Hero MotoCorp up by 1.34%. On the flip side, Hindustan Unilever down by 0.54%, ITC down by 0.54%, HDFC Bank down by 0.50%, TCS down by 0.37% and Cipla down by 0.08% were the top losers.

Meanwhile, the Cabinet Committee on Economic Affairs (CCEA), headed by the Prime Minister Narendra Modi, has approved a new policy for grant of extension to the Production Sharing Contracts (PSC) signed by Government of India awarding Pre-NELP Exploration Blocks to enable and facilitate investment to extract the remaining reserves. Based on the new policy, the Government share of Profit Petroleum during the extended period of contract would be 10% higher for these fields, thus bringing additional revenues to Government.

During the extension period, contractors are expected to make an additional investment of more than $ 5430 million. This policy will enable the contractors to extract not only the remaining reserves but also plan to extract additional reserves by implementing new technologies. The policy will give boost to accelerate and supplement indigenous production of hydrocarbon from existing blocks and act as a progressive step towards achieving the target of 10% reduction in import of crude oil by 2022.
Moreover, the policy brings out detailed guidelines regarding grant of extension, criterion for evaluation of request, time frame for consideration of request, duration of extension etc. The extension of these contracts is likely to bring extra investments in the fields and would generate both direct and indirect employment.

In certain fields, additional recovery of hydrocarbons can be obtained through Enhanced Oil Recovery / Improved Oil Recovery (EOR/IOR) Projects and as such the production would extend beyond the current duration of PSC. In the year 2016-17, the production from these oil & gas blocks, allotted in Pre- NELP regime, is around 55 million barrel of oil and 965 MMSCM of natural gas. The recoverable reserve from these blocks is estimated to be more than 426 million barrel of oil equivalent.

The CNX Nifty is currently trading at 9062.90, up by 32.45 points or 0.36% after trading in a range of 9048.60 and 9076.35. There were 40 stocks advancing against 11 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 2.97%, BPCL up by 2.12%, Wipro up by 1.92%, Tata Motors - DVR up by 1.89% and GAIL India up by 1.82%. On the flip side, Eicher Motors down by 1.19%, Bosch down by 0.71%, ITC down by 0.66%, TCS down by 0.56% and Hindustan Unilever down by 0.55% were the top losers.

Asian markets were trading in green; Shanghai Composite increased 0.8 points or 0.02% to 3,246.02, FTSE Bursa Malaysia KLCI increased 3.35 points or 0.19% to 1,751.65, KOSPI Index increased 4.42 points or 0.2% to 2,172.72, Hang Seng increased 6.05 points or 0.02% to 24,326.46, Taiwan Weighted increased 8.08 points or 0.08% to 9,930.74, Jakarta Composite increased 36.45 points or 0.66% to 5,570.54 and Nikkei 225 increased 43.93 points or 0.23% to 19,085.31.