Markets trade range-bound with strong gains

The local benchmarks continued to trade range-bound with strong gains in late morning session, aided by firm Asian markets along with higher buying appeared at Realty, Metal and Banking counters. Moody's Investors Service’s up-gradation of India’s sovereign rating, kept the market mood cheerful. The rating agency upgraded India’s sovereign rating to Baa2 from Baa3 and changed the outlook to stable from positive. The markets also took support with Niti Aayog Vice Chairman Rajiv Kumar’s statement that India's credit rating upgrade by Moody's is a reflection of the country's growth story. He also expressed hope that other global agencies such as S&P and Fitch would follow suit. Separately, Finance Minister Arun Jaitley said it is a recognition that India continues to follow the path of fiscal prudence which has brought stability to the economy. In line with larger peers, the broader indices too performed well, with gains of over a percent each.

On the global front, European markets were trading mixed, as US tax cuts move closer to passage. On the economic front, investors await comments from ECB President Mario Draghi later in the day. Asian markets were trading in green. Back home, in scrip specific development, Reliance Capital surged after the company’s subsidiary --Reliance General Insurance Company signed a comprehensive Bancassurance - Corporate Agency agreement with Yes Bank, with the objective to distribute multiple general insurance products to the customers of Yes Bank, further augmenting its distribution network.

The BSE Sensex is currently trading at 33419.59, up by 312.77 points or 0.94% after trading in a range of 33387.37 and 33520.82. There were 24 stocks advancing against 7 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.16%, while Small cap index was up by 1.06%.

The top gaining sectoral indices on the BSE were Realty up by 4.10%, Metal up by 2.05%, Bankex up by 1.60%, Consumer Durables up by 1.57% and Healthcare up by 1.37%, while IT down by 1.20% and TECK down by 0.87% were the only losing indices on BSE.

The top gainers on the Sensex were ICICI Bank up by 2.71%, Cipla up by 2.69%, Tata Steel up by 2.50%, Bharti Airtel up by 2.09% and Sun Pharma up by 2.03%. On the flip side, Infosys down by 1.53%, TCS down by 1.33%, Wipro down by 0.82%, ONGC down by 0.72% and Asian Paints down by 0.63% were the top losers.

Meanwhile, raising concerns over the disappointing second quarter earnings, credit rating agency, Care Ratings in its latest report has said that a series of factors like adjustment to GST regime, lower industrial growth and limited pickup in demand have hit the companies’ Q2 performance and have led to a decline of about 1.5% in net profit of Q2 FY18 over a growth of 13.2% in the corresponding period last year.

As per the report titled ‘Corporate Performance: Q2-FY18’, GST regime and low industrial growth have also slowed down net sales growth of the companies to 7% in Q2 FY18, against a growth of 10% in Q2 FY17. The report further noted that the overall performance was skewed due to the performance of banks, oil companies, IT and finance which are guided by other exogenous factors, while excluding these sectors the performance of industry depicts similar trend in Q2 FY18.

Care Ratings further reported that the industry’s net profit excluding banks, IT, oil & refineries, and finance sectors, declined by 4.4% in Q2, as against a growth rate of 15.4% in the corresponding period last year, while net sales grew at a much slower rate of 4.7% in Q2 FY18, as against  growth rate of 11.8% in Q2 FY17.

The CNX Nifty is currently trading at 10303.35, up by 88.60 points or 0.87% after trading in a range of 10302.75 and 10343.60. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Cipla up by 3.08%, Vedanta up by 2.94%, ICICI Bank up by 2.73%, HDFC up by 2.65% and Tata Steel up by 2.58%. On the flip side, Tech Mahindra down by 3.11%, TCS down by 1.51%, Infosys down by 1.50%, Bosch down by 1.34% and Bharti Infratel down by 1.26% were the top losers.

Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 3.19 points or 0.19% to 1,721.30, Jakarta Composite increased 35.6 points or 0.59% to 6,073.50, Nikkei 225 increased 45.68 points or 0.2% to 22,396.80, Taiwan Weighted increased 76.6 points or 0.72% to 10,701.64 and Hang Seng increased 180.28 points or 0.62% to 29,199.04. On the flip side, Shanghai Composite decreased 16.34 points or 0.48% to 3,382.91 and KOSPI Index decreased 0.8 points or 0.03% to 2,533.99.

European markets were trading mixed; Germany’s DAX increased 4.78 points or 0.04% to 13,052.00. On the flip side, UK’s FTSE 100 decreased 20.95 points or 0.28% to 7,365.99 and France’s CAC decreased 9.61 points or 0.18% to 5,326.78.