Bourses trade near neutral line in late morning session

Key Indian benchmarks were trading near neutral line with positive bias in late morning session. Traders were getting some support with ICRA’s latest report stating that economic expansion in terms of gross value added (GVA) is expected to improve to 6.3% in the three months to September from 5.6% in the previous quarter, on the back of a rise in industrial growth. It further noted that headline GVA growth, however, is likely to trail the 6.8% recorded in the second quarter of FY17. Investors also took some comfort with the report that the government has set up a 14-member panel to identify and suggest ways to address issues faced in implementation of the law. On the sectoral front, shares of auto companies were trading higher, aided by Fitch Ratings’ report that sales of passenger vehicles and two-wheelers in India are expected to continue to grow in high single digits in the near term, riding on low ownership cost supported by good monsoons and higher public-sector wages.

On the global front, Asian markets were trading in green, following the fresh record closing highs overnight on Wall Street with investors’ sentiments boosted by upbeat corporate earnings results and higher commodity prices. Back home, in scrip specific development, Glenmark Pharma traded higher on receiving final approval for generic Loestrin Fe 1/20 Tablets.

The BSE Sensex is currently trading at 33523.08, up by 44.73 points or 0.13% after trading in a range of 33465.23 and 33624.49. There were 15 stocks advancing against 16 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.31%, while Small cap index up by 0.19%.

The top gaining sectoral indices on the BSE were Realty up by 0.90%, Auto up by 0.48%, Consumer Disc up by 0.48%, Industrials up by 0.31% and Consumer Durables up by 0.05%, while Telecom down by 0.89%, Metal down by 0.63%, Healthcare down by 0.41%, Bankex down by 0.34% and Energy down by 0.29% were the top losing indices on BSE.

The top gainers on the Sensex were Adani Ports & SEZ up by 2.29%, Tata Motors up by 1.64%, Bajaj Auto up by 1.45%, HDFC up by 1.33% and Mahindra & Mahindra up by 1.06%. On the flip side, Dr. Reddy’s Lab down by 1.13%, Sun Pharma down by 0.88%, Axis Bank down by 0.87%, Bharti Airtel down by 0.78% and Hindustan Unilever down by 0.63% were the top losers.

Meanwhile, in a move that will enhance mergers and acquisitions, the Telecom Regulatory Authority of India (TRAI) has suggested to remove the current intra-band cap on spectrum held by mobile operators within a particular band and instead, there should be a 50 percent limit on combined radiowave holding in efficient bands like 700 MHz, 800 MHz, and 900 MHz. It has also suggested to raise the limit for overall holding across all bands to 35 percent from 25 percent.

Both the suggestions, once accepted by the department of telecommunications (DoT), would provide a major relief for the soon-to -be-merged Idea Cellular and Vodafone, as they would have breached the spectrum cap in certain locations under the existing rules. It would also enable aggressive newcomer Reliance Jio to acquire more spectrum, if needed, in bands like 800 MHz. DoT had sought TRAI’s views on whether the current norms -- 50 percent cap in a particular band and 25 percent limit for total spectrum held across all bands in a given circle -- should continue or need to be reviewed. In turn, the telecom regulator sought the views of the operators before coming out with its recommendations.

Explaining the rationale behind its recommendations, TRAI has said that the overall 25 percent ceiling on spectrum was imposed at a time when there were 6-10 telecom operators in a given telecom circle and noted that the number of telecom operators in a service area now had come down, following consolidation in the sector. Besides, it stated that the service providers are also free now to use any technology of their choice in any band or using multiple bands. It pointed out that as LTE (Long term Evolution) device ecosystem is evolving in each of the spectrum band, there is no real need to put spectrum cap in each spectrum band. However, it argued that imposing a cap in the sub-1GHz band was important as these are most optimal bands.  

The CNX Nifty is currently trading at 10329.80, up by 2.90 points or 0.03% after trading in a range of 10309.55 and 10368.70. There were 19 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were Zee Entertainment up by 3.47%, Adani Ports & SEZ up by 2.41%, Tata Motors up by 1.72%, HDFC up by 1.40% and Bajaj Auto up by 1.36%. On the flip side, Bharti Infratel down by 2.16%, Tech Mahindra down by 2.13%, Bajaj Finance down by 1.92%, Dr. Reddy’s Lab down by 1.36% and Aurobindo Pharma down by 1.35% were the top losers.

All the Asian markets were trading in green; FTSE Bursa Malaysia KLCI increased 4.85 points or 0.28% to 1,725.53, KOSPI Index increased 8.56 points or 0.34% to 2,539.26, Jakarta Composite increased 23.69 points or 0.39% to 6,055.55, Shanghai Composite increased 26.86 points or 0.79% to 3,437.36, Taiwan Weighted increased 47.63 points or 0.44% to 10,826.87, Nikkei 225 increased 133.51 points or 0.6% to 22,549.99 and Hang Seng increased 298.05 points or 1% to 30,116.12.