Bourses hover near Day’s highs

The local equity benchmarks were hovering near the intraday high points in late afternoon session, despite weak opening in European markets. Gains were led by shares of telecom and IT and industry majors like TCS, Tata Motors and Asian Paints, amid firm Asian cues. Investors continued to take encouragement with a private report stating that consumer confidence in India is likely to remain high over the next six months with a very optimistic outlook. Some relief was also came with Securities and Exchange Board of India’s (SEBI's) decision to relax entry norms for Foreign Portfolio Investors (FPIs) willing to invest in the Indian markets. Traders paid no heed towards the reports stating that India reported a fiscal deficit of Rs 6.12 trillion ($95.77 billion) for April-November, or 112% of the budgeted target for the current fiscal year that ends in March. On the sectoral front, most of the Fast Moving Consumer Goods (FMCG) sector stocks were trading higher, amid report that the FMCG sector, which has been down in the dumps in the past two years with a tepid 4% revenue growth, is poised for a 'mean revision' with government shifting its focus towards boosting growth ahead of the next hustings.

On the global front, European markets were trading mostly in red, as investors wave goodbye to 2017 and look ahead to what the New Year will bring for markets. However, Asian markets were trading mostly in green. Back home, in scrip specific development, Techno Electric & Engineering Company gained on receiving a new order amounting to around Rs 206 crore from The Afghanistan Breshna Sherkat (DABS), Kabul, Afghanistan for design, supply and construction of 500 KV Substation.

The BSE Sensex is currently trading at 34042.46, up by 194.43 points or 0.57% after trading in a range of 33889.39 and 34045.62. 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 0.49%, while Small cap index was up by 0.62%.

The top gaining sectoral indices on the BSE were Telecom up by 1.55%, IT up by 1.31%, TECK up by 1.31%, Power up by 1.05% and FMCG up by 0.94%, while Metal down by 0.78%, Oil & Gas down by 0.32% and Energy down by 0.19% were the only losing indices on BSE.

The top gainers on the Sensex were TCS up by 2.51%, Asian Paints up by 2.06%, Tata Motors - DVR up by 1.87%, Axis Bank up by 1.64% and Wipro up by 1.61%. On the flip side, Mahindra & Mahindra down by 0.36%, Tata Steel down by 0.27%, Coal India down by 0.25%, Dr. Reddy’s Lab down by 0.24% and Reliance Industries down by 0.10% were the top losers.

Meanwhile, offsetting headwinds in exports and intensifying competition, Indian pharmaceutical industry is expected to witness better revenue growth in the near term with healthy cash flows, on the back of robust domestic demand and rising need for complex products in the West. Credit rating agency, Crisil in its latest report has said that the sector would log in a 9% revenue growth over the next three years ending 2020.

The rating agency however, said that the current fiscal year would be critical for the pharma sector overall export, as it will able to grow at rate of 1% only. It also pointed that over half of the exports are to the regulated markets in the West but those are set to de-grow by 5 per cent this fiscal, after growing 3 per cent last fiscal, due to greater price erosion in existing products amid rising competition and delayed launches of new products or import ban on existing products following scrutiny from the USFDA.

However, over the medium term, the ratings agency sees trend reversal with 7% annual growth in revenues of regulated markets and 6% annual growth in overall exports, on the back of faster product approvals from the FDA. As per report, research and development (R&D) spending of the companies are expected to increase 700 basis points over fiscal 2017 to reach 30% of annual revenue from the regulated markets over the medium term and better access to healthcare, higher penetration of health insurance and increasing lifestyle diseases will sustain domestic demand.

The CNX Nifty is currently trading at 10524.50, up by 46.60 points or 0.44% after trading in a range of 10488.65 and 10527.10. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were TCS up by 2.61%, Bharti Infratel up by 2.31%, HCL Tech. up by 2.27%, Asian Paints up by 2.01% and Axis Bank up by 1.88%. On the flip side, GAIL India down by 1.90%, BPCL down by 1.41%, Vedanta down by 1.38%, Hindalco down by 1.24% and HPCL down by 1.02% were the top losers.

Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 0.84 points or 0.05% to 1,779.94, Shanghai Composite increased 10.79 points or 0.33% to 3,307.17, Jakarta Composite increased 23.6 points or 0.37% to 6,337.65, Hang Seng increased 55.44 points or 0.19% to 29,919.15 and Taiwan Weighted increased 75.22 points or 0.71% to 10,642.86. On the flip side, Nikkei 225 decreased 19.04 points or 0.08% to 22,764.94.

European markets were mostly in red; Germany’s DAX decreased 13.19 points or 0.1% to 12,966.75 and France’s CAC decreased 2.95 points or 0.06% to 5,336.47. On the flip side, UK’s FTSE 100 increased 7.22 points or 0.09% to 7,630.10.