Bourses add some gains; Realty stocks shine

Key Indian benchmarks added some gains in late morning session, aided by optimism in all the sectoral indices. Traders continued to take support with Prime Minister Narendra Modi’s statement that India has emerged as one of the fastest-growing economies and a happening place with immense opportunities in a number of areas. Firmness in broader indices too added support to the markets. Some support also came with the ministry of finance’s statement that India’s news Insolvency and Bankruptcy Code (IBC) ordinance, promulgated by the President, will pave the way for clean business by putting a premium on integrity. Investors shrugged off a private report which highlighted that both goods and services tax (GST) collections as well as its compliance in the first four months since the rollout of the new tax regime remain well below the target, and the situation is unlikely to improve in the near- term.

On the global front, Asian markets were trading mixed, with most of them recovering from lows shrugging off the news of North Korean missile test. Back home, in scrip specific development, Shriram City Union Finance rose on planning to raise Rs 500 crore by issuing debt securities on private placement basis.

The BSE Sensex is currently trading at 33675.00, up by 56.41 points or 0.17% after trading in a range of 33612.34 and 33690.92. There were 23 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.19%, while Small cap index was up by 0.59%.

The top gaining sectoral indices on the BSE were Realty up by 1.53%, Capital Goods up by 0.74%, Healthcare up by 0.71%, Industrials up by 0.59% and Consumer Durables up by 0.53%, while there were no losing sectoral indices on the BSE.

The top gainers on the Sensex were Coal India up by 1.93%, Bajaj Auto up by 0.93%, Sun Pharma up by 0.83%, Dr. Reddy’s Lab up by 0.83% and Larsen & Toubro up by 0.78%. On the flip side, Axis Bank down by 1.26%, HDFC down by 0.84%, Mahindra & Mahindra down by 0.20%, Maruti Suzuki down by 0.15% and Asian Paints down by 0.08% were the top losers.

Meanwhile, global rating agency, Moody's Investors Service in its first report on the domestic insurance sector has stated that Indian non-life insurance sector is expected to maintain its double digit growth over the next three to four years, on the back of higher economic expansion and increased household spending. Besides, it projected that gross domestic product (GDP) of the country will grow by 6.7 percent in the fiscal year ending March 2018, making it one of the fastest growing economies in the world. However, it noted that annual insurance penetration remains comparatively low in India at just 3.5 percent of GDP, but is likely to increase in line with household spending.

The rating agency further indicated that in 2016-17 fiscal, the top 10 non-life insurers, recorded 30 percent growth in gross direct premium to Rs 1 lakh crore, while their top five life counterparts reported a 14 percent rise in gross premium to Rs 3 lakh crore. It also pointed out that the large private insurers have benefited the most, growing premia by 42 percent year-on-year in the year to March 2017. It added that these insurers are well placed for continued expansion, given their strong brands and market positions.

The report also welcomed the liberalization in the reinsurance space, which is evident from eight private reinsurers, Munich Re, Swiss Re, Scor and RGA, entering the market this year. It expects that the arrival of major global reinsurers will improve Indian insurers' access to reinsurance, supporting their management of underwriting risk. It also said that this should also help gradually reverse a recent deterioration in the non-life sector's underwriting performance due to rising claims expenses. Moreover, Moody's in its report has stated that regulatory risk-based capital rules, effective in fiscal year 2021, will encourage insurers to adopt eligibility criteria for their investment assets that will improve quality of portfolios. However, it noted that separate rules would be needed for insurers to adopt external actuarial reserving assessments, expected from March 2018.

The CNX Nifty is currently trading at 10384.60, up by 14.35 points or 0.14% after trading in a range of 10364.10 and 10391.90. There were 32 stocks advancing against 18 stocks declining on the index.

The top gainers on Nifty were Bosch up by 3.62%, Coal India up by 1.88%, Aurobindo Pharma up by 1.24%, GAIL India up by 1.18% and Ambuja Cement up by 1.03%. On the flip side, Axis Bank down by 1.40%, UPL down by 1.07%, HDFC down by 0.78%, Tech Mahindra down by 0.71% and HPCL down by 0.67% were the top losers.

Asian markets were trading mixed; Hang Seng decreased 73.64 points or 0.25% to 29,607.21, Shanghai Composite decreased 19.9 points or 0.6% to 3,313.75, Jakarta Composite decreased 18.14 points or 0.3% to 6,052.57 and KOSPI Index decreased 1.75 points or 0.07% to 2,512.44.

On the flip side, FTSE Bursa Malaysia KLCI increased 2.94 points or 0.17% to 1,717.36, Taiwan Weighted increased 6.48 points or 0.06% to 10,713.55 and Nikkei 225 increased 94.1 points or 0.42% to 22,580.34.