Indian equities extend gains; trade near intra-day high level

Indian benchmark indices extended their early gains to continue firm trade in noon session, hovering near intra-day high level, tracking positive trend seen in Asian markets after oil prices climbed from their 10-month lows, while investors also took cues from the minutes of Reserve Bank of India’s (RBI) June policy meeting. The central bank’s monetary policy committee wants more evidence that inflation has sustainably fallen below its target before deciding whether to lower interest rates. RBI voted 5-1 to keep the repo rate at 6.25% earlier this month, but issued a slightly less hawkish statement after consumer inflation eased to 2.99% in April, below its 4% target.

Sentiments got some support from the report that economic think-tank NCAER revised up its projection for the country’s economic growth to 7.6% for the current fiscal, compared with the earlier prediction of 7.3% on forecast of normal monsoon. In its quarterly review of the economy, NCAER said prospects for the agricultural sector in 2017-18 remain optimistic on forecast of good rains. The agency has also revised upward its forecast of GVA (Gross Value Added at Basic Prices) growth at 7.3% for 2017-18 from its February estimate of 7%. In a key decision, the market regulator SEBI banned participatory notes (p-notes) from taking naked positions in the derivatives segment, and eased the entry process for foreign portfolio investors (FPIs). It also removed the one-year lock-in requirement for private equity investors registered as alternative investment funds (AIFs) in initial public offerings (IPOs).

On the global front, Asian markets were trading mostly higher on Thursday as oil prices inched up after hitting a 10-month low overnight on concerns over a supply glut and falling demand, dragging US and European shares lower. The market largely shrugged off comments overnight from Iran’s oil minister that members of the Organization of Petroleum Exporting Countries (OPEC) are considering deeper cuts in production. Further, Chinese shares added to gains made on Wednesday after MSCI included mainland shares in its emerging market indexes.

Back home, stocks from IT, Telecom and Banking counters were supporting the markets’ uptrend, while those from Oil & Gas, PSU and FMCG counters were adding to the underlying cautious undertone. In scrip specific development, Prime Urban Development surged after the company received an approval to acquire 58,02,925 equity shares of Rs 10 each at a premium of Rs 60.71 per share constituting 100% of the paid up equity share capital of New Line Buildtech (NLBPL), a Private Limited Company incorporated under the Companies Act, 1956. Furthermore, Alembic Pharmaceuticals gained after the company received approval from the US Food & Drug Administration (USFDA) for its Abbreviated New Drug Application (ANDA) for Amantadine Hydrochloride Capsules, USP, 100 mg.

The market breadth remained optimistic, as there were 1468 shares on the gaining side against 858 shares on the losing side, while 107 shares remained unchanged.

The BSE Sensex is currently trading at 31521.17, up by 237.53 points or 0.76% after trading in a range of 31336.96 and 31522.87. There were 24 stocks advancing against 7 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.60%, while Small cap index up by 0.70%.

The top gaining sectoral indices on the BSE were IT up by 1.48%, TECK up by 1.34%, Consumer Disc up by 0.76%, Telecom up by 0.75% and Bankex up by 0.75%, while Oil & Gas down by 0.48%, PSU down by 0.13% and FMCG down by 0.02% were the few losing indices on BSE.

The top gainers on the Sensex were Infosys up by 2.52%, Sun Pharma up by 1.62%, HDFC up by 1.56%, Reliance Industries up by 1.40% and Axis Bank up by 1.17%. On the flip side, Hindustan Unilever down by 1.75%, ONGC down by 1.67%, Lupin down by 1.59%, Coal India down by 0.58% and Dr. Reddy’s Lab down by 0.39% were the top losers.

Meanwhile, Department of Industrial Policy and Promotion (DIPP), under the Commerce and Industry Ministry, has formed six groups for preparing a framework for the country’s new industrial policy that includes several areas like ways to encourage innovation, further simplification of taxation system and address new challenges of the manufacturing sector.

Apart from this, the groups would also prepare reports on infrastructure, intellectual property rights (IPRs), ease of doing business and employability of future workforce. Members of these groups include government officials, academicians and representatives of professional firms. The draft of the policy should be ready by September this year.

The new policy aims at aligning with the government’s flagship programmes such as Make in India, Skill India, Startup India and the foreign direct investment norms. With the changing manufacturing scenario and introduction of Industrial Revolution 4.0, there is a need to completely revamp the industrial policy of 1991. Industrial Revolution 4.0 means use of modern technologies, artificial intelligence and robotics in manufacturing.

The CNX Nifty is currently trading at 9695.50, up by 61.90 points or 0.64% after trading in a range of 9642.35 and 9697.95. There were 38 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Infosys up by 2.39%, Yes Bank up by 2.12%, Aurobindo Pharma up by 1.96%, Sun Pharma up by 1.73% and HDFC up by 1.64%. On the flip side, GAIL India down by 2.23%, Hindustan Unilever down by 1.83%, Lupin down by 1.74%, ONGC down by 1.46% and BPCL down by 1.32% were the top losers.

Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI rose 0.07%, KOSPI Index gained 0.49%, Shanghai Composite increased 0.74%, Nikkei 225 jumped 0.01%, Taiwan Weighted added 0.48% and Hang Seng was up by 0.52%. On the flip side, Jakarta Composite was down by 0.12%.