Benchmarks end choppy day with marginal gains; Nifty holds 9,850 mark

It turned out to be a choppy day of trade for Indian equity benchmarks and key gauges eked out slender gains on Thursday, with Nifty holding their crucial 9,850 level and Sensex ending just shy of 31,600 mark. Markets traded with volatility through the session as traders kept a close eye on a central banking conference in Jackson Hole, Wyoming, which begins on Thursday, where Federal Reserve Chair Janet Yellen and European Central Bank President Mario Draghi are both due to speak. Domestic bourses traded mostly in green with traders taking support with a private research enlightening that the implementation of the new Insolvency and Bankruptcy Code is expected to give a big push to credit growth as international experience shows that laws to resolves bad assets have helped boost credit growth. Some support also came with report that India’s agricultural sector has potential to double the income of farmers and grow exports to $100 billion by 2022. According to Crop Care Federation of India (CCFI) president Rajju Shroff, now the country ranks second-largest food producer in the world, touching $367 billion in 2014.

However, gains remained capped after the Reserve Bank of India’s (RBI) data showed that India Inc’s overseas direct investment fell over 47 percent to $1.77 billion during July 2017. Indian companies had invested $3.35 billion in the same month of last year. Of the total investments in foreign ventures by Indian companies overseas, $900.66 million was in the form of issuance of guarantee, $513.81 million as loan and $353.55 million was part of equity investment.

On the global front, European markets were trading in green in early deals, as the previous session’s upbeat euro zone data continued to support. Euro zone consumer confidence rose slightly in August. Asian markets exhibited mixed trend ahead of a meeting of central bankers in the US state of Wyoming that could provide fresh cues on interest rates and unwinding stimulus plans.

Back home, buying in public sector bank lending some support to the markets after the Cabinet on Wednesday approved a framework to speed up mergers of public sector banks, the first of which could take place by March. The mergers will not involve any cash but only share swaps. The government also said there would be no job losses after any of the mergers. Shares of liquor companies rallied in early trade with report suggesting that the Supreme Court on Wednesday clarified that the liquor ban on highways does not extend to municipal areas. Media stocks remained buzzing, as the Finance Ministry has said that the rate of Goods and Services Tax (GST) applicable on selling of advertisement space in print media would depend on the terms of the contract between the newspaper, advertisement agency and the client.

The NSE’s 50-share broadly followed index Nifty gained marginally to hold its psychological 9,850 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex increased around thirty points to end just shy of its crucial 31,600 mark. The broader markets traded with traction and ended the session with a gain of around half a percent. The market breadth was in the favour of advances, as there were 1,432 shares on the gaining side against 1,126 shares on the losing side, while 149 shares remain unchanged.

Finally, the BSE Sensex rose 28.05 points or 0.09% to 31,596.06, while the CNX Nifty was up by 4.55 points or 0.05% to 9,857.05.

The BSE Sensex touched a high and a low of 31,678.19 and 31,546.05, respectively and there were 17 stocks on gaining side as against 14 stocks on losing side on the index.

The broader indices ended in green; the BSE Mid cap index gained 0.80%, while Small cap index was up by 0.46%.

The top gaining sectoral indices on the BSE were Healthcare up by 2.53%, IT up by 0.69%, TECK up by 0.54%, Capital Goods up by 0.53% and Industrials up by 0.50%, while Realty down by 0.83%, Energy down by 0.37%, FMCG down by 0.24% and Oil & Gas was down by 0.12% were the few losing indices on BSE.

The top gainers on the Sensex were Lupin up by 3.87%, Sun Pharma up by 3.10%, Dr. Reddy’s Lab up by 2.88%, Cipla up by 2.47% and Infosys was up by 2.01%. On the flip side, Adani Ports & SEZ down by 1.32%, Bajaj Auto down by 1.04%, Reliance Industries down by 0.88%, HDFC down by 0.73% and Hindustan Unilever was down by 0.72% were the top losers.

Meanwhile, India’s agricultural sector has potential to double the income of farmers and grow exports to $100 billion by 2022. According to Crop Care Federation of India (CCFI) president Rajju Shroff, now the country ranks second-largest food producer in the world, touching $367 billion in 2014. He said that global exports in agricultural products is over $1,500 billion annually as per the latest data from WTO and of which India’s share is less than $35 billion. He also said that they have urged the government to increase focus on trebling India’s share in agri exports to double farmer income by 2022.

A not-for-profit organisation Centre for Environment and Agriculture (Centegro) in its report also emphasized the need to raise India's share in global agri exports to increase farmers' income automatically. It noted that India ranks second globally in agricultural production, whereas in services and manufacturing sectors its position stood at 11th and 12th respectively. It further stated that agriculture’s contribution to India’s economy extends beyond the rural economy and encompasses many activities in manufacturing and services sector.

The report pointed out that export surplus from the country’s agricultural trade is higher than the corresponding figure achieved by the manufacturing sector. In line with 'Make in India' campaign, the report urged the government to launch ‘Grow In India’ campaign aiming for substantial gains in agri-exports with a single authority to monitor India's international agricultural trade-both exports and imports.

The CNX Nifty traded in a range of 9,881.50 and 9,848.85. There were 27 stocks in green as against 23 stocks in red, while one stocks remained unchanged on the index.

The top gainers on Nifty were Aurobindo Pharma up by 4.80%, Lupin up by 3.99%, Cipla up by 2.93%, Sun Pharma up by 2.71% and Dr. Reddy’s Lab up by 2.42%. On the flip side, HCL Tech down by 1.57%, ACC down by 1.38%, Adani Ports & SEZ down by 1.35%, Bajaj Auto down by 1.04% and Indiabulls Housing Finance down by 1.04% were the top losers.

European markets were trading in green; France’s CAC increased 16.24 points or 0.32% to 5,131.63, UK’s FTSE 100 rose 29.47 points or 0.4% to 7,412.12 and Germany’s DAX was up by 48.61 points or 0.4% to 12,222.91.

Asian equity markets ended mixed on Thursday after overnight slide in US and European peers. While strong regional earnings as well as higher oil and metal prices helped spur stock-specific buying, renewed geopolitical tensions and uncertainty over US political risks served to keep underlying sentiments somewhat cautious. Fitch Ratings said the US's sovereign rating would be in jeopardy if Congress can't get a deal done to raise the federal debt ceiling in a timely manner. Investors also kept a close eye on a central banking conference in Jackson Hole, Wyoming, beginning later in the day, where Fed Chair Janet Yellen and ECB President Mario Draghi are due to speak. Chinese shares fell the most in two weeks as investors booked profits after recent gains on optimism over state-owned enterprise restructuring. Meanwhile, Japanese shares hit a 3-1/2-month low as steelmakers succumbed to heavy selling after reports of price cuts and US President Donald Trump's comments on NAFTA and the debt ceiling prompted haven demand for the yen.