Markets hover near highest points of the day

Indian equity benchmarks added gains in the late afternoon session and continued their firm trade hovering near the highest points of the day amid higher opening in European markets. Sentiments remained optimistic in the wake of reports that the Union Cabinet approved promulgation of an ordinance to amend the Banking Regulation Act for resolution of the bad loan crisis facing banks. The markets also got fillip with the cabinet approved the National Steel Policy, 2017, along with other major decisions. The US Federal Reserve's decision to keep key interest rates unchanged also boosted investors' sentiments. On the macro front, data released by Markit Economics during market hours today showed that the rate of increase in Indian service sector activity weakened in April 2017. The headline seasonally adjusted Nikkei Services PMI Business Activity Index fell to 50.2 in April, from 51.5 in March.

On the global front, European markets were trading in green after being buoyed by corporate earnings and a televised political debate which saw centrist presidential candidate Emmanuel Macron maintain his lead on euroskeptic opponent Marine Le Pen ahead of this Sunday's French election. Asian markets were trading mixed after the US Federal Reserve indicated it remains on track to deliver two more rate increases by year-end. Back home, in scrip specific development, ICICI Bank was trading jubilantly after the bank reported a jump of around three-fold in its net profit at Rs 2,024.64 crore for the quarter ended March 31, 2017 as compared to Rs 701.89 crore for the same quarter in the previous year.

The BSE Sensex is currently trading at 30135.19, up by 240.39 points or 0.80% after trading in a range of 30007.40 and 30149.41. There were 19 stocks advancing against 11 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 0.39%.

The top gaining sectoral indices on the BSE were Bankex up by 2.17%, FMCG up by 1.02%, Consumer Durables up by 0.81%, Capital Goods up by 0.81% and PSU up by 0.45%, while Realty down by 0.85%, Oil & Gas down by 0.82%, Energy down by 0.67%, Metal down by 0.62% and Auto down by 0.53% were the top losing indices on BSE.

The top gainers on the Sensex were ICICI Bank up by 9.42%, Axis Bank up by 3.57%, Adani Ports & SEZ up by 2.70%, SBI up by 2.70% and Hindustan Unilever up by 1.77%. On the flip side, Tata Motors down by 1.67%, ONGC down by 0.89%, HDFC Bank down by 0.77%, Mahindra & Mahindra down by 0.73% and Cipla down by 0.69% were the top losers.

Meanwhile, owing to a slower expansion in new business and employment, growth in India's service sector eased in April. The seasonally adjusted Nikkei Services PMI Business Activity Index fell to 50.2 in April from 51.5 in March. However, the reading stayed above the watershed ‘50’ mark for the third straight month. Expansion has now been registered for three successive months, but the latest reading was the lowest in this period. The seasonally adjusted Nikkei India Composite PMI Output Index which measures both manufacturing and services also decreased to 51.3 in April from 52.3 in March.

As per survey, average input cost inflation slowed from March’s nine-month high amid reports of lower fuel prices partly offsetting higher transport costs arising from lorry strikes, while the rate of charge inflation accelerated. It further noted that advertising campaigns supported the increase in new work growth in the sector, though competitive pressures lowered the growth. The rate of expansion in new business was only marginal overall, having softened from that registered in March. However, the order books at goods producers rose to the greatest extent in six months.

Services companies signalled positive predictions for future output growth. Nonetheless, optimism fell slightly, with around 18% of survey participants anticipating lower activity in the year ahead compared with 21% that foresee expansion. The report also found that that new proposals, additional marketing campaigns and new offerings would aid the upturn in activity, while concerns towards the increasingly competitive environment weighed on confidence. Sentiment among manufacturers improved to a five-month high. Service providers raised their own output charges (on average) in April. Selling prices have now increased for three months in a row. The rate of inflation remained slight and below its long-run average, despite accelerating since March.

The CNX Nifty is currently trading at 9356.65, up by 44.70 points or 0.48% after trading in a range of 9323.25 and 9361.40. There were 25 stocks advancing against 26 stocks declining on the index.

The top gainers on Nifty were ICICI Bank up by 9.44%, Axis Bank up by 3.73%, Grasim Industries up by 2.93%, Adani Ports & SEZ up by 2.76% and Bank of Baroda up by 2.61%. On the flip side, HCL Technologies down by 2.50%, Hindalco down by 2.23%, BPCL down by 1.85%, Tata Motors down by 1.62% and Indusind Bank down by 1.48% were the top losers.

Asian markets were trading mixed; Jakarta Composite increased 4.71 points or 0.08% to 5,652.07, Taiwan Weighted increased 12.31 points or 0.12% to 9,967.64 and KOSPI Index increased 21.57 points or 0.97% to 2,241.24. On the flip side, FTSE Bursa Malaysia KLCI decreased 16.31 points or 0.92% to 1,756.20, Hang Seng decreased 12.25 points or 0.05% to 24,683.88 and Shanghai Composite decreased 7.98 points or 0.25% to 3,127.37.

All the European markets were trading in green; UK’s FTSE 100 increased 20.8 points or 0.29% to 7,255.33, France’s CAC increased 28.88 points or 0.54% to 5,329.88 and Germany’s DAX increased 78.41 points or 0.63% to 12,606.25.