Markets at all-time highs; NSE resumes trading

Indian equity indices continued trading higher in late afternoon session, with both Sensex and Nifty hitting their all-time highs, tracking firm European markets. Nifty resumed its trading which was halted temporarily in both cash and derivatives segment due to technical reasons. Sentiments remained optimistic with the report that the Goods and Services Tax (GST) is set to impart better competitiveness to micro, small and medium enterprises and provide them a level-playing field with large firms owing to factors like an easier process of availing input credit and simpler tax regime. Buying was witnessed in shares of IT, TECK, telecom and realty. India’s steel consumption grew by 4.6 percent to nearly 21 million tonne in the first quarter of the current fiscal over the same period in 2016, while the country's steel exports jumped by nearly 66 percent in the April-June period, too aided the markets. There was also renewed positivity over global growth after last Friday’s higher-than-expected US employment data. US jobs grew more than expected in June.

On the global front, European markets were trading in green, as robust Chinese inflation data added to investor optimism over gains in US jobs. Investors also remained cautions with the second-quarter earnings season that’s about to kick off in Europe. Asian markets were trading mixed. In scrip specific development, GlaxoSmithKline Pharma traded higher on plan to invest Rs 1,000 crore in a new state-of-the-art pharmaceutical unit located at Vemgal in state of Karnataka and is looking at enhancing its global pipeline in areas like respiratory drugs and vaccines in India.

The BSE Sensex is currently trading at 31706.89, up by 346.26 points or 1.10% after trading in a range of 31471.41 and 31711.71. There were 29 stocks advancing against 2 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.60%, while Small cap index was up by 0.47%.

The top gaining sectoral indices on the BSE were Telecom up by 2.93%, TECK up by 2.40%, IT up by 2.39%, PSU up by 1.79% and Realty up by 1.55%, while FMCG down by 0.03% was the only losing indices on BSE.

The top gainers on the Sensex were TCS up by 4.24%, Bharti Airtel up by 4.12%, Wipro up by 3.80%, Lupin up by 3.36% and Sun Pharma up by 3.13%. On the flip side, ITC down by 0.25% and Mahindra & Mahindra down by 0.13% were the top losers.

Meanwhile, furthering its restrictions on participatory notes or Offshore Derivative Instruments (ODIs), markets regulator Securities and Exchange Board of India (SEBI) has banned foreign portfolio investors (FPIs) from issuing such instruments where the underlying assets are derivatives.

In its latest circular ‘Guidelines for issuance of ODIs, with derivative as underlying, by the ODI issuing FPIs’, the SEBI said that P-Note issuances on derivatives can be issued only for the purpose of hedging with respect to the equity shares held. Besides, it said that in cases where the underlying derivatives position are not for purpose of hedging the equity shares, the issuing FPI has to liquidate such ODIs latest by the date of maturity or by December 31, 2020, whichever is earlier.

The circular further said that a certificate has to be issued by the compliance officer (or equivalent) of the ODI-issuing FPI in the case of issuance of fresh ODIs with derivatives as underlying and it should be certified that the derivatives position, on which the ODI is being issued, is only for hedging the equity shares held by it, on a one-to-one basis. Besides, SEBI also asked to submit the monthly ODI reports along with this certificate.

The CNX Nifty is currently trading at 9764.50, up by 98.70 points or 1.02% after trading in a range of 9646.45 and 9772.20. There were 47 stocks advancing against 4 stocks declining on the index.

The top gainers on Nifty were TCS up by 4.22%, Bharti Airtel up by 3.78%, Bank of Baroda up by 3.61%, Wipro up by 3.43% and Sun Pharma up by 3.26%. On the flip side, Mahindra & Mahindra down by 0.51%, ITC down by 0.33%, Eicher Motors down by 0.24% and Kotak Mahindra Bank down by 0.19% were the top losers.

Asian markets were trading mixed; KOSPI Index increased 2.23 points or 0.09% to 2,382.10, Nikkei 225 increased 151.89 points or 0.76% to 20,080.98 and Hang Seng increased 159.21 points or 0.63% to 25,500.06. On the flip side, Jakarta Composite decreased 32.77 points or 0.56% to 5,782.02, Taiwan Weighted decreased 7.34 points or 0.07% to 10,289.91, Shanghai Composite decreased 5.32 points or 0.17% to 3,212.63 and FTSE Bursa Malaysia KLCI decreased 4.71 points or 0.27% to 1,755.22.

All European markets were trading in green; France’s CAC increased 8.92 points or 0.17% to 5,154.08, UK’s FTSE 100 inched up by 17.18 points or 0.23% to 7,368.10 and Germany’s DAX was up by 64.26 points or 0.52% to 12,452.94.