Bourses continue to hold modest gains in afternoon deals

Indian equity benchmarks continued to hold their modest gains in early afternoon session on account of buying in front line blue chip counters despite weak trend in Asian markets. Sentiments remained positive with a joint report by Ficci and Deloitte which stated that Indian retail industry, growing at 10 percent, may almost double to Rs 85 trillion by 2021 steered by consumer data and technology disruptions. Moreover, healthy buying witnessed in Capital Goods, Industrials, Metal and Telecom stocks also helped the key indices to trade with gains. However, gains were muted with Sebi imposing an Rs 2,423 crore penalty on PACL and its four directors for illegal fund mobilisation through various schemes that were used by the group to garner over Rs 49,000 crore from the public. Meanwhile, the rupee went up 17 paise to 63.87 against the dollar in early trade on fresh selling of the American unit by exporters and banks. In scrip specific development, Biocon surged by around three percent with its arm receiving EU GMP Compliance Certificate for insulin facility in Malaysia.

On the global front, Asian markets were trading mostly in red, following the lackluster cues overnight from Wall Street after European Central Bank chief Mario Draghi hinted that decisions about the future of the ECB's massive stimulus may be decided in October. Investors were cautious as they await the release of China's trade data for August later in the day.

The BSE Sensex is currently trading at 31707.04, up by 44.30 points or 0.14% after trading in a range of 31642.79 and 31763.70. There were 13 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.07%, while Small cap index was up by 0.45%.

The top gaining sectoral indices on the BSE were Capital Goods up by 2.37%, Industrials up by 1.18%, Metal up by 0.87%, Telecom up by 0.79% and Basic Materials up by 0.51%, while Healthcare down by 0.56%, Realty down by 0.51%, Power down by 0.42%, PSU down by 0.35% and Energy down by 0.18% were the top losing indices on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 4.31%, Bharti Airtel up by 1.52%, Kotak Mahindra Bank up by 1.40%, Tata Steel up by 0.99% and Maruti Suzuki up by 0.72%. On the flip side, Dr. Reddy’s Lab down by 3.22%, Mahindra & Mahindra down by 1.74%, Sun Pharma down by 1.50%, Lupin down by 1.01% and Bajaj Auto down by 0.94% were the top losers.

Meanwhile, in order to augment domestic supplies ahead of the festive season, the government has allowed import of 3 lakh tonnes of raw sugar at concessional duty of 25 percent. In the month of July this year, the government had increased import duty on sugar from 40 percent to 50 percent to restrict cheap inward shipments and maintain domestic prices.

Sugar production in India is estimated to decline to around 21 million tonnes (MT) in 2016-17 season ending September from 25 MT in the previous year, while the annual demand is 24-25 MT. In April this year, the Central government allowed duty free import of raw sugar up-to 5 lakh tonnes to boost domestic supplies and check price rise amid production fall.  Earlier, the government had imposed stock limit on sugar mills for the next two months in a bid to keep sugar prices under control during the festive season.

As per the government’s notification, by the end of September, a mill cannot keep more than 21 percent of its total sugar availability for the entire 2016- 17 marketing year and a factory cannot hold more than 8 percent at the end of October. At present, sugar is being sold at an average price of Rs 42 per kg in most retail markets in the country, while branded sweetener is available at Rs 50 per kg. In the international market, white sugar prices have fallen by 8 percent since July and trend seems downward. Also, the domestic wholesale price of sugar are flat.

The CNX Nifty is currently trading at 9945.85, up by 15.95 points or 0.16% after trading in a range of 9929.35 and 9963.60. There were 23 stocks advancing against 28 stocks declining on the index.

The top gainers on Nifty were Larsen & Toubro up by 4.07%, Kotak Mahindra Bank up by 1.59%, Bharti Airtel up by 1.55%, Vedanta up by 1.48% and Tata Steel up by 1.29%. On the flip side, Dr. Reddy’s Lab down by 3.27%, Mahindra & Mahindra down by 1.88%, Sun Pharma down by 1.63%, BPCL down by 1.13% and Lupin down by 1.13% were the top losers.

The Asian markets were trading mostly in red; Nikkei 225 decreased 121.7 points or 0.63% to 19,274.82, FTSE Bursa Malaysia KLCI was down by 7.4 points or 0.42% to 1,775.58, Shanghai Composite shed 4.97 points or 0.15% to 3,360.52 and KOSPI Index dipped 2.47 points or 0.11% to 2,343.72.

On the flip side, Jakarta Composite increased 1.07 points or 0.02% to 5,833.39, Taiwan Weighted rose 71.44 points or 0.68% to 10,609.95 and Hang Seng added 114.12 points or 0.41% to 27,637.04.