Indian benchmarks settle with moderate gains; market breadth negative

It turned out to be a session of moderate gains for the Indian stock markets, which came off the highest point of the day in dying hours of trade as investors booked profits in recent outperformers such as Bharti Airtel and Hindustan Unilever, while negative opening in European markets also capped gains. However, the benchmarks managed to settle at record closing highs for the second straight session as local sentiments continued to show signs of improvement amid optimism over Indian Meteorological Department's prediction of a 'normal' monsoon this calendar. IMD said that the prospects of the monsoon have brightened due to reduced chances of El-Nino. With results of several front line stocks due over the course of the next few sessions and the data on industrial output and consumer price inflation due on Friday, the mood was slightly cautious. Furthermore, with the indices and various blue chip stocks hovering around all-time highs, market participants are looking for some direction to build up significant positions. Investors remained cautious with the RBI's data suggesting that new financial year began on a sour note for bank credit growth, which slipped to 4.32% in the fortnight to April 28, much lower than the 63-year low level of 5.08% in FY17. However, sentiments got some support with the report that Prime Minister Narendra Modi is setting up a task force under the chairmanship of the Vice Chairman of NITI Aayog Dr Arvind Panagriya, with an aim to create policies on employment based on credible data. The Prime Minister has directed that this task be expedited so that policies on employment can be formulated with a proper appreciation of impacts, based on credible data. Meanwhile, Auto stocks surged on expectations of lower interest rates after a better monsoon forecast eased inflation fears in a country that depends heavily on rains to irrigate its farmlands.

On the global front, Asian markets ended mostly higher on Thursday as global equities remained at record levels and a rebound in oil boosted energy producers. Chinese shares ended higher, led by gains in realty and infrastructure stocks, after reports suggested that the central bank is likely to inject funds via its medium-term lending facility on Friday. Also, Japanese market eked out some gains as crude prices inched higher and the yen held steady around the 114 level following the release of strong trade and investment data. However, European markets were under pressure as investors reacted to the latest batch of corporate earnings.

Back home, the local benchmarks got off to an encouraging start tracking the optimism prevailing in Asian markets as a rebound in oil boosted energy producers. The frontline indices soon gathered momentum and traded with over quarter percent gains through the morning session of trade. However, the bourses witnessed intense selling pressure in a volatile afternoon session after surging to all-time highs in initial trade. The frontline indices treaded on a southbound journey thereafter as investors gradually started taking profits off the table, which led the benchmarks to snap Thursday's session around low point of the day. Finally, the NSE's 50-share broadly followed index - Nifty settled with trivial gains of fifteen points above the psychological 9,400 levels, while Bombay Stock Exchange's Sensitive Index - Sensex shed three points and closed above the psychological 30,200 mark. The market breadth remained pessimistic, as there were 1247 shares on the gaining side against 1583 shares on the losing side, while 162 shares remained unchanged.

Finally, the BSE Sensex gained 2.81 points or 0.01% to 30250.98, while the CNX Nifty was up by 15.10 points or 0.16% to 9,422.40. 

The BSE Sensex touched a high and a low of 30366.43 and 30207.11, respectively and there were 14 stocks on gainers side as against 16 stocks on the losers side on the index.

The broader indices ended mixed; the BSE Mid cap index gained 0.05%, while Small cap index was down by 0.05%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.65%, Consumer Disc up by 1.16%, Auto up by 0.98%, Metal up by 0.69% and TECK up by 0.57%, while Power down by 1.22%, Utilities down by 1.03%, Oil & Gas down by 0.93%, PSU down by 0.77% and Energy down by 0.63% were the top losing indices on BSE.

The top gainers on the Sensex were Hero MotoCorp up by 4.26%, Bajaj Auto up by 3.12%, Adani Ports & SEZ up by 2.28%, SBI up by 1.15% and ITC up by 1.00%. On the flip side, Bharti Airtel down by 2.21%, GAIL India down by 2.14%, ONGC down by 1.94%, Hindustan Unilever down by 1.78% and Axis Bank down by 1.69% were the top losers.

Meanwhile, in order to meet rising domestic demand of liquefied petroleum gas (LPG), India the world's second largest LPG importer, for the first time ever will be importing LPG from Iran. India has signed a contract with Iran to import LPG, in which state-owned oil firms will import one very large gas carrier (VLGC), or 44,000 tonnes, per month for an initial six-month period.

LPG consumption in 2016-17 rose 9.8 per cent to 21.55 million tones, of this, 11 million tonnes came from imports. To meet the rising demand, the country imports almost a million tonnes of LPG every month. LPG imports are further expected to rise over the next three years to 16-17 million tonnes as the government pushes for making available cooking gas cylinders to the poor and wean them off polluting fuels.

Demand for the LPG may grow by 9.7 per cent to 23.7 million tonnes in the current fiscal and may touch 35 million tonnes by 2031-32 due to increase in penetration of cooking gas connections in rural areas.

At present, India imports LPG via term contracts from major Middle Eastern producers Saudi Aramco, Qatar’s Tasweeq, Abu Dhabi National Oil Co and Kuwait Petroleum Corp and is also planning to import LPG from Bangladesh.

The CNX Nifty traded in a range of 9,450.65 and 9,411.30. There were 29 stocks in green as against 22 stocks in red on the index.

The top gainers on Nifty were Eicher Motors up by 5.85%, ZEEL up by 4.8%, Hero MotoCorp up by 4.37%, Hindalco up by 3.39% and Bajaj Auto up by 3.06%. On the flip side, Bharti Airtel down by 2.37%, ONGC down by 2.18%, GAIL India down by 2.11%, Axis Bank down by 2.08% and IOC down by 1.95% were the top losers.

European markets were trading in red; UK’s FTSE 100 decreased 8.64 points or 0.12% to 7,376.60, Germany’s DAX shed 2.29 points or 0.02% to 12,755.17 and France’s CAC was down by 2.07 points or 0.04% to 5,398.39.

Asian equity markets ended higher on Thursday, with a rebound in crude oil prices and rising optimism about the US economy lending some support. Chinese shares reversed earlier losses to end higher, led by gains in realty and infrastructure stocks, after reports suggested that the central bank is likely to inject funds via its medium-term lending facility on Friday. Further, Japanese shares eked out modest gains as crude prices inched higher and the yen held steady around the 114 level following the release of strong trade and investment data. Meanwhile, the Indonesian market was closed in observance of Wesak Day.