Benchmarks continue to trade in green in noon session

In an extremely range-bound session of trade, Indian equity benchmarks continued to trade in green in noon session, tracking positive trend seen in other Asian markets after Wall Street rallied with Nasdaq hitting record high on strong US corporate earnings. Sentiments got some support with International Monetary Fund's (IMF) report that India’s growth has been ‘impressive’ in the recent years which makes room for tax broadening efforts by the government. The rollout of Goods and Services tax (GST) is an extremely important step that will create a true unified national market in India. However, investors turned cautious after deputy governor of RBI SS Mundra’s statement that the Indian government and the Reserve Bank of India had not yet reached an agreement on a new plan to clean up the record troubled debt accumulated at the country’s lenders. There will be some important result announcements to keep the markets in action. Further, RBI's monetary policy committee cited upside risks to inflation arising from price pressure excluding food and fuel as the main reason for keeping its policy rate unchanged, according to minutes of its April meeting released on Thursday. The six-member monetary policy committee (MPC), which aims to bring down inflation to 4% in the medium term, maintained its hawkish stance on inflation, with most members expressing concern over upside risks to core inflation.

On the global front, Asian markets were trading mostly higher on Friday, following the overnight rally on Wall Street amid renewed hopes of tax reform in the US after Treasury Secretary Steven Mnuchin indicated that the Trump administration plans to unveil a major tax reform plan very soon. Market participants continued to keep an eye on developments in France following news that a policeman was shot dead in Paris in a suspected terrorist attack just days before the presidential election.

Back home, barring Healthcare index, which declined 0.33%, all the other indices were in the positive territory, with Realty, Energy and Consumer Durable indices being prominent gainers. In scrip specific development, Mastek rallied after the company reported a strong 29% quarter on quarter (QoQ) growth in net profit at Rs 14.5 crore in March quarter (Q4 FY17). Total revenue of the company jumped 42% Q-o-Q to Rs 182 crore during the quarter under review against Rs 128 crore in Q3 FY17. Further, Bharat Seats surged after the company reported a rise of 40.70% in its net profit at Rs 4.01 crore for the quarter ended March 31, 2017 as compared to Rs 2.85 crore for the same quarter in the previous year.

The market breadth remained optimistic, as there were 1686 shares on the gaining side against 834 shares on the losing side, while 121 shares remained unchanged.

The BSE Sensex is currently trading at 29492.21, up by 69.82 points or 0.24% after trading in a range of 29451.33 and 29584.34. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.50%, while Small cap index up by 0.95%.

The top gaining sectoral indices on the BSE were Realty up by 2.46%, Energy up by 1.24%, Consumer Durables up by 1.00%, Telecom up by 0.86% and Capital Goods up by 0.69%, while Healthcare down by 0.33% was the only losing index on BSE.

The top gainers on the Sensex were Reliance Industries up by 2.75%, Axis Bank up by 1.55%, ONGC up by 1.28%, NTPC up by 1.25% and Asian Paints up by 0.63%. On the flip side, Sun Pharma down by 2.15%, Cipla down by 1.38%, HDFC down by 0.72%, Power Grid down by 0.60% and TCS down by 0.48% were the top losers.

Meanwhile, Commerce and Industry Minister Nirmala Sitharaman said that frequent fluctuation in currencies across the world, not just the Indian rupee, has become a new normal. She also said that the value of the currency is only one factor and exporters in India have learnt to take into account currency fluctuation while planning their consignments.

For enhancing export competitiveness, the minster has stated that it is not just the currency which gives the competitiveness but there are some other factors like infrastructure, raw material cost, energy supplies and state restrictions which are equally essential for exporters. Adding further, she said that rising of the local currency against the US dollar makes export uncompetitive as per unit realization comes down. She also highlighted that the exchange rate alone cannot be the one cause for export competitiveness and the volatility in currencies across the world has been the new normal in the last few years. 

Sitharaman further said that strengthening of the Indian rupee is also a reflection on the performance of the economy and noted that since January, the domestic currency has strengthened by over 5 per cent against the US dollar. She added that a section of exporters too has expressed anxieties that rupee appreciation can impact their margins at a time when export has seen a growth.

Meanwhile, the export growth touched over five year high of 27.6 per cent in March on the back of better performance of petroleum and engineering sector, though the expansion during financial year 2016-17 stood at only 4.7 per cent. During the last financial year, exports aggregated at $274.64 billion. In March, outward shipments were at $29.23 billion.

The CNX Nifty is currently trading at 9159.30, up by 22.90 points or 0.25% after trading in a range of 9147.25 and 9183.65. There were 30 stocks advancing against 21 stocks declining on the index.

The top gainers on Nifty were Reliance Industries up by 2.86%, Tech Mahindra up by 1.84%, Bharti Infratel up by 1.78%, Indiabulls Housing up by 1.77% and ONGC up by 1.48%. On the flip side, Sun Pharma down by 2.30%, Cipla down by 1.42%, Grasim Industries down by 1.29%, ACC down by 0.98% and Ambuja Cement down by 0.83% were the top losers.

Most of the Asian markets were trading in green; FTSE Bursa Malaysia KLCI increased by 10.25 points or 0.59% to 1,751.86, KOSPI Index gained 16.02 points or 0.75% to 2,165.17, Jakarta Composite surged by 35.59 points or 0.64% to 5,630.89, Hang Seng jumped 55.48 points or 0.23% to 24,112.46, Taiwan Weighted added 84.72 points or 0.88% to 9,717.41 and Nikkei 225 was up by 190.26 points or 1.03% to 18,620.75.

On the other hand, Shanghai Composite decreased by 8.52 points or 0.27% to 3,163.58.