Benchmarks extend gains; trade near intra-day high levels

Indian equity benchmarks extended gains and continued firm trade in early afternoon session, hovering near intra-day high levels, due to heavy buying in healthcare, FMCG, Energy and Oil & Gas stocks. Sentiments remained up-beat with report that the growth of eight core infrastructure industries surged to five-month high by 4.9% in August 2017, as compared to 2.4% in July 2017, on the back of a double-digit jump in coal production and subsequent rise in electricity generation. Some optimism also came with the report that India is expected to retain its position as the top remittances receiving country, with its diaspora set to pump in a whopping $65 billion in the year 2017. Besides, the rupee's strength against dollar also provided some support to the equity markets. However, some caution lingered in the market ahead of the outcome of the central bank’s policy meeting. In scrip specific development, Intense Technologies surged by over six and half percent after partnering with a leading Caribbean and Central American telecom service provider to spearhead its digital transformation initiative.

On the global front, Asian markets were trading in green, after Wall Street closed at fresh record highs overnight, while oil prices dipped for a second straight session. Back home, the BSE Sensex is currently trading at 31682.47, up by 185.09 points or 0.59% after trading in a range of 31457.78 and 31685.91. There were 22 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.54%, while Small cap index was up by 0.87%.

The top gaining sectoral indices on the BSE were Healthcare up by 1.93%, FMCG up by 1.55%, Energy up by 1.14%, Oil & Gas up by 0.99% and Industrials up by 0.84%, while Telecom down by 0.59% and TECK down by 0.12% were the only losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 3.66%, ITC up by 2.35%, Dr. Reddy’s Lab up by 1.86%, Tata Motors - DVR up by 1.76% and Power Grid up by 1.65%. On the flip side, Bharti Airtel down by 2.04%, ICICI Bank down by 0.70%, Coal India down by 0.50%, Axis Bank down by 0.49% and NTPC down by 0.39% were the top losers.

Meanwhile, the global ratings agency, Moody’s Investors Service in its latest report has said that India will overtake China as the fastest-growing Asian market for petroleum products by the year 2018, on the back of a 6 percent demand growth in the sector. As economic activity in China slows down, the report expected that China’s refined product demand growth will moderate to 2.5-3 percent in FY18, which is nearly half of compounded annual growth rate of 5 percent in 2012-16. It pointed out that in absolute terms, China will still account for 48 percent of Asia's R&M sector's demand growth in 2018. 

Despite the weakening growth numbers in China and India, the ratings agency believed that both the countries will continue to be the key growth engines for the sector in Asia, representing over 80 percent of the expected growth in 2018. Citing the American energy information administration projections, it said that the demand for petroleum products in the Asia Pacific will rise a modest 2 percent or 0.7 million barrels per day in to 34.6 million bpd in 2018.

Given the oil sector's reliance on China and increasingly India, the report further mentioned that demand would face considerable risks if economic growth weakens materially below their expectations. Driven by China’s and India’s appetite for petroleum products and continued capacity rationalisation, the report said that refining margins will remain firm, thereby supporting the earnings growth. It also expected the average Asian refining margins to be largely in line with the average of $6.2 per barrel for the last three years, but better than $5.1 per barrel in 2016.

The CNX Nifty is currently trading at 9918.85, up by 59.35 points or 0.60% after trading in a range of 9850.65 and 9918.95. There were 37 stocks advancing against 13 stocks declining on the index, while 1 stock remained unchanged.

The top gainers on Nifty were Sun Pharma up by 3.62%, ITC up by 2.37%, Dr. Reddy’s Lab up by 2.12%, Aurobindo Pharma up by 1.99% and HPCL up by 1.93%. On the flip side, Bharti Airtel down by 1.83%, Axis Bank down by 0.71%, ICICI Bank down by 0.70%, Coal India down by 0.70% and Eicher Motors down by 0.57% were the top losers.

The Asian markets were trading in green; FTSE Bursa Malaysia KLCI increased 0.44 points or 0.03% to 1,760.11, Nikkei 225 rose 12.59 points or 0.06% to 20,626.66, Jakarta Composite added 20.76 points or 0.35% to 5,960.22 and Hang Seng was up by 168.32 points or 0.6% to 28,341.53.