Benchmarks continue firm trade in late morning session

Indian equity benchmarks continued their firm trade in late morning session on account of buying in frontline blue chip counters. Fourth quarter earnings of Reliance Industries to be announced later in the day also kept the investors cheery at the start of a week that may see choppiness ahead of the expiry of April series Futures & Options contracts. The street expects RIL to report a 10% rise in standalone profit in the fourth quarter from a year earlier on rising volumes and higher profitability of its petrochemical business and stable gross refining margins. The rupee opened higher against dollar on Monday on account of selling of American currency by banks and exporters amid buoyed equity market. Traders were taking encouragement with Finance Minister Arun Jaitley’s statement that India continues to be the fastest growing major economy in the world and its growth will accelerate further due to factors like implementation of GST. The economy will grow at a clip of 7.5 percent this fiscal, up from 7.1 percent in the previous year and it remains resilient with low inflation, fiscal prudence and low deficit. Jaitley added that scrapping of old Rs 500 and Rs 1,000 notes will increase tax compliance and reduce threat of counterfeit currency. Investors took note of Niti Aayog vice chairman Arvind Panagariya statement that India will be a Rs 469 lakh crore, or $7.2 trillion, economy by 2030, growing at an average rate of 8 percent. This would be a more than three-fold expansion from Rs 137 lakh crore, or $2.1 trillion, in 2015-16.

Traders were seen piling position in Realty, Capital Goods and Basic Materials stocks, while selling was witnessed in Healthcare, Telecom and TECK sector stocks. In scrip specific development, JHS Svendgaard Laboratories was trading firm after the on-going disputes at various courts between the company and various group companies of Procter & Gamble in India, were settled with mutual consent and concluded positively for JHS. The settlement clears contingent liabilities to the tune of Rs 206.15 crore, from the balance sheet of JHS. Wipro, TCS and Infosys were trading in red after US accused them of unfairly cornering the lion’s share of H-1B visas by putting extra tickets in the lottery system, which the Donald Trump administration wants to replace with a more merit-based immigration policy.

On the global front, Asian shares were trading mostly in red, as tension on the Korean peninsula weighed on sentiment. North Korea reportedly arrested an American citizen in Pyongyang at the weekend. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 9,150 and 29,500 levels respectively. The market breadth on BSE was positive in the ratio of 1548:861, while 109 scrips remained unchanged.

The BSE Sensex is currently trading at 29501.44, up by 136.14 points or 0.46% after trading in a range of 29392.99 and 29526.19. There were 15 stocks advancing against 15 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 0.77%.

The top gaining sectoral indices on the BSE were Realty up by 3.64%, Capital Goods up by 1.34%, Basic Materials up by 1.24%, Industrials up by 1.08% and Utilities up by 0.63%, while Healthcare down by 0.53%, Telecom down by 0.45%, TECK down by 0.43%, IT down by 0.35% and Metal down by 0.26% were the losing indices on BSE.

The top gainers on the Sensex were HDFC Bank up by 2.65%, Larsen & Toubro up by 1.98%, HDFC up by 1.89%, Adani Ports & Special Economic Zone up by 1.78% and GAIL India up by 1.62%.

On the flip side, Lupin down by 2.51%, Cipla down by 1.38%, ICICI Bank down by 1.11%, Wipro down by 0.99% and Infosys down by 0.89% were the top losers.

Meanwhile, the Union Finance Minister Arun Jaitley has expressed his confidence that India’s gross domestic product (GDP) will expand at a rate of 7.5% in the financial year 2017-18, up from 7.1% percent in the previous fiscal. He also said that the country’s growth remains strong with low inflation, fiscal prudence as well as low current account deficit (CAD). 

The finance minister stated that developing economies have become increasingly important in driving global growth, accounting for more than 75 per cent of global expansion. He also said that among developing economies, India has been a major driver of global economic growth and has also undertaken robust structural reform measures. 

Talking about GST, Jaitley said that India is on course to roll out the ambitious goods and services tax (GST) regime from July 2017 and noted that the new indirect tax regime will eliminate the multiplicity of taxes and make India a single common market. He further said that demonetization move will push the Indian economy to a less-cash trajectory, increase tax compliance and reduce threats from counterfeit currency, which acts as a source of terror funding.

Jaitley who was participating in G-20 finance ministers' and central bank governors' meeting, also said that India has significantly stepped up investment in electricity, roads, financial access and housing for the poor and the government has taken a number of steps to ensure inclusive growth.

The CNX Nifty is currently trading at 9161.80, up by 42.40 points or 0.46% after trading in a range of 9130.55 and 9167.15. There were 28 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were ACC up by 4.34%, Grasim Industries up by 3.92%, Ultratech Cement up by 2.81%, HDFC Bank up by 2.70% and Ambuja Cement up by 2.26%.

On the flip side, Lupin down by 2.38%, Indian Oil Corporation down by 1.68%, Cipla down by 1.67%, ICICI Bank down by 1.11% and BPCL down by 1.10% were the top losers.

The Asian markets were trading mostly in red; Shanghai Composite decreased 54.23 points or 1.71% to 3,118.92, Hang Seng decreased 35.11 points or 0.15% to 24,006.91 and Taiwan Weighted decreased 4.45 points or 0.05% to 9,712.96.

On the other hand, KOSPI Index increased 4.65 points or 0.21% to 2,169.69 and Nikkei 225 increased 247.25 points or 1.33% to 18,868.00.

Jakarta Stock Exchange and Kuala Lumpur Stock Exchange remained closed on account of trading holiday.