Benchmarks trade slightly in green

Indian equity benchmarks have made a positive start and are trading slightly in green in early deals on Tuesday on the back of good macro-economic data. India’s industrial production grew by 3.1 percent in April due to good performance of electricity, mining and manufacturing sectors, while retail inflation fell to a record low of 2.18 percent in May, as prices of kitchen staples like vegetables and pulses declined sharply. However, gains remained capped, as traders remained cautious with the US Federal Reserve’s two-day rate-setting meeting kicks off later today. While the Fed is widely expected to hike the policy rate this time, markets will also keenly watch its communication on US economic growth and future rate hike trajectory. 

On the global front, Asian markets are seeing recovery and most of the indices were trading in green at this point of time, as selloff in technology shares showed signs of easing. The US markets despite coming off the day’s low ended modestly in red in the last session, tech-heavy Nasdaq continued underperforming its counterparts, pulling back further off the record closing high set last week.

Back home, banking stocks remained on buyers’ radar, as the government and the RBI on Monday indicated that they will step up efforts to clean up bank books that are saddled with record non-performing assets (NPAs), including through the National Infrastructure Investment Fund (NIIF). Meanwhile, the market breadth indicating the overall health of the market was strong, with 1292 shares gaining and 615 shares declining, while a total of 95 shares were unchanged.

The BSE Sensex is currently trading at 31144.28, up by 48.58 points or 0.16% after trading in a range of 31075.80 and 31200.31. There were 22 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.44%, while Small cap index was up by 0.72%.

The top gaining sectoral indices on the BSE were Realty up by 0.85%, Healthcare up by 0.58%, Utilities up by 0.57%, Power up by 0.50% and Basic Materials up by 0.49%, while IT down by 0.49%, Metal down by 0.37% and TECK was down by 0.34% were the few losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 1.66%, Lupin up by 1.43%, Power Grid up by 0.85%, Maruti Suzuki up by 0.84% and GAIL India up by 0.82%. On the flip side, TCS down by 0.72%, Tata Motors down by 0.66%, Infosys down by 0.49%, Coal India down by 0.42% and ONGC down by 0.21% were the top losers.

Meanwhile, India’s industrial production grew by 3.1 percent in April 2017, as compared to 2.7 percent in the month of March 2017 and against a drop of 1.2 percent in February 2017. The growth was due to good performance of electricity, mining and manufacturing sectors. The Index of Industrial Production (IIP) for the month of April 2017 stood at 117.9. The cumulative growth for the period April-March 2016-17 over the corresponding period of the previous year stood at 5.0 percent.

As per the data released by the Central Statistics Office of the Ministry of Statistics and Programme Implementation, IIP with base 2011-12 for the month of April 2017, the indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month of April 2017 stood at 99.9, 117.9 and 150.6 respectively, with the corresponding growth rates of 4.2 percent, 2.6 percent and 5.4 percent as compared to April 2016. The cumulative growth in these three sectors during April-March 2016-17 over the corresponding period of 2015-16 has been 5.4 percent, 4.9 percent and 5.8 percent respectively.

The output of capital goods, which are the barometer of investment in the country, contracted by 1.3 percent in April compared to growth of 8.1 percent a year ago. Similarly, consumer durables or white goods production declined 6 percent in April against 13.8 percent growth a year ago. As per Use-based classification, the growth rates in April 2017 over April 2016 are 3.4 percent in primary goods, 4.6 percent in intermediate goods and 5.8 percent in infrastructure/ construction goods. The consumer non-durables recorded a growth rate of 8.3 percent.

In terms of industries, 14 out of the 23 industry groups in the manufacturing sector showed positive growth during the month of April 2017 as compared to the corresponding month of the previous year. The industry group ‘Manufacture of pharmaceuticals, medicinal chemical and botanical products’ showed the highest positive growth of 29.1 percent followed by 17.9 percent in ‘Manufacture of tobacco products’ and 9.5 percent in ‘Manufacture of machinery and equipment n.e.c.’. On the other hand, the industry group ‘Manufacture of beverages’ showed the highest negative growth of (-) 19.2 percent followed by (-) 15.6 percent in ‘Manufacture of motor vehicles, trailers and semi-trailers’ and (-) 14.4 percent in ‘Manufacture of electrical equipment’.

The CNX Nifty is currently trading at 9631.15, up by 14.75 points or 0.15% after trading in a range of 9614.10 and 9646.75. There were 31 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Sun Pharma up by 1.94%, ACC up by 1.77%, Ultratech Cement up by 1.38%, Lupin up by 1.32% and Ambuja Cement up by 1.24%. On the flip side, Vedanta down by 1.18%, Tech Mahindra down by 1.12%, HCL Tech down by 0.73%, TCS down by 0.65% and Infosys down by 0.60% were the top losers.

Asian markets were trading mostly in green; Jakarta Composite rose 5.71 points or 0.1% to 5,697.14, Shanghai Composite gained 11.37 points or 0.36% to 3,151.25, KOSPI Index increased 12.49 points or 0.53% to 2,370.36, Taiwan Weighted added 23.83 points or 0.24% to 10,133.79 and Hang Seng was up by 133.83 points or 0.52% to 25,841.87.

On the flip side, Nikkei 225 was down by 15.67 points or 0.08% to 19,892.91.