Benchmarks trade firm near highest point of the day

Indian equity benchmarks continued their firm trade in morning session hovering near the highest point of the day on account of buying in frontline blue chip counters. The rupee opened lower against dollar on account of selling of American currency by banks and exporters. Foreign Portfolio Investors stood net buyers in domestic equity markets on Friday and bought shares worth Rs 175.09 crore with gross purchases and gross sales of Rs 4,314.40 crore and Rs 4,139.31 crore, respectively. Traders took support with NITI Aayog Vice Chairman Arvind Panagariya’s statement that India’s economic growth rate is likely to be 7.5 percent for the current financial year. He said ‘For the current fiscal year of 2017-18, I expect that we will be back to at least 7.5 percent and as you get towards the last quarter of the year probably we will begin to touch 8 percent, but the average for the year would be about 7.5 percent’. Separately, the International Monetary Fund (IMF) has retained India’s economic growth projections at 7.2 percent in 2017-18, up slightly from 7.1 percent in the previous year. However, the growth would accelerate to 7.7 percent in 2018-19, IMF said while also maintaining the growth rate level projected in April. Traders were seen piling up position in Consumer Durables, Energy and FMCG stocks, while selling was witnessed in Healthcare and Metal sector stocks. In scrip specific development, Avenue Supermarts was trading in green as the company, which owns D-Mart chain of supermarkets, reported a 47.60 percent year-on-year (YoY) rise in net profit at Rs 174.77 crore for the June quarter. The Radhakishan Damani-promoted firm had reported Rs 118.44 crore profit in the corresponding quarter of last year.

On the global front, Asian shares were trading mostly in green, in thin regional trade that saw Mainland China get a boost. Growth in Japan’s manufacturing activity slowed for the second straight month in July, a preliminary private survey showed, as export demand stagnated.  Back home, the BSE Sensex and NSE Nifty were trading above the psychological 32,200 and 9,950 levels respectively. The market breadth on BSE was positive in the ratio of 1370:853, while 123 scrips remained unchanged.

The BSE Sensex is currently trading at 32202.25, up by 173.36 points or 0.54% after trading in a range of 32058.33 and 32220.85. There were 20 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.36%, while Small cap index was up by 0.60%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.16%, Energy up by 1.07%, FMCG up by 1.00%, IT up by 0.78% and Realty up by 0.74%, while Healthcare down by 0.26% and Metal down by 0.04% were the only losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 2.02%, ITC up by 1.87%, Wipro up by 1.71%, ICICI Bank up by 1.59% and Hero MotoCorp up by 1.11%.

On the flip side, Dr. Reddy’s Lab down by 1.88%, Asian Paints down by 1.28%, ONGC down by 1.22%, Sun Pharma down by 0.49% and Tata Motors down by 0.36% were the top losers.

Meanwhile, NITI Aayog Vice Chairman Arvind Panagariya, despite acknowledging creation of “good jobs” in India remains a big challenge, has said that India’s economic growth rate is likely to be 7.5 percent for the current financial year. He said ‘For the current fiscal year of 2017-18, I expect that we will be back to at least 7.5 percent and as you get towards the last quarter of the year probably we will begin to touch 8 percent, but the average for the year would be about 7.5 percent.’

Panagariya said he does not agree with the classification in some sections of the media that India's economic growth is a jobless growth. He also said it is unfortunate that India's better performing sectors such as automobile, auto parts, engineering goods, petroleum refinery, pharmaceuticals and IT enabled services, are not very employment-intensive. He added that all these sectors are either very capital intensive or skill labour intensive. There is a big need for good jobs at the lower, semi-skilled level, thus there is a big challenge. He also said that there is not enough creation of good jobs that pay good wages.

NITI Aayog Vice Chairman further said that jobs are being created, but certainly good jobs which pay good wages, those have not been very successful with and that is where the big challenge lies. That also requires some reconfiguration of the structure of manufacturing towards more labour intensive sectors like clothing, footwear and food processing. He noted that China, which is the major exporter of all these products, is experiencing very high wages and is already quitting some of the space in these labour intensive sectors and he added that it is a good time for India to move into those sectors.

The CNX Nifty is currently trading at 9963.25, up by 48.00 points or 0.48% after trading in a range of 9919.60 and 9966.60. There were 32 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Reliance Industries up by 2.12%, Bank of Baroda up by 1.92%, Yes Bank up by 1.92%, Wipro up by 1.91% and ITC up by 1.64%.

On the flip side, Dr. Reddy’s Lab down by 1.97%, Asian Paints down by 1.33%, ONGC down by 1.28%, Indian Oil Corporation down by 0.77% and Vedanta down by 0.76% were the top losers.

The Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 0.57 points or 0.03% to 1,759.73, Shanghai Composite increased 5.97 points or 0.18% to 3,243.95, Jakarta Composite increased 9.49 points or 0.16% to 5,774.92 and Hang Seng increased 123.74 points or 0.46% to 26,829.83.

On the other hand, Nikkei 225 decreased 157.27 points or 0.78% to 19,942.48, KOSPI Index decreased 2.42 points or 0.1% to 2,447.64 and Taiwan Weighted decreased 1.55 points or 0.01% to 10,435.15.