Bourses maintain gaining momentum; Metal stocks shine

Key Indian benchmarks maintained their gaining momentum in late morning session, backed by firm Asian cues. Besides, the broader indices were outperforming the larger peers, while widespread buying witnessed in all the sectors except Automobile. Traders’ sentiments were upbeat with the Rajya Sabha giving green signal to the Insolvency and Bankruptcy Code (IBC) (Amendment) Bill 2017. Some support also came with the report that India is likely to impose anti- dumping duty of up to $397 per tonne on a Chinese chemical used in construction and dyes industry, in order to guard domestic players from cheap imports. The traders were also taking some encouragement with the private report stating that India’s growth rate is expected to accelerate over the coming year and are likely to improve further to 7.6% by 2019-20 as key sectors would revive from disruptions related to the implementation of GST and demonetization. Meanwhile, the Telecom regulator, Telecom Regulatory Authority of India (TRAI) has come up with new interconnection regulations and mandated service providers to enter into interconnection agreement on non-discriminatory basis within 30 days of receiving network connectivity request from another operator.

On the global front, Asian markets were trading mostly in green, following the record closing highs overnight on Wall Street on the first trading day of 2018 and on higher commodity prices. Optimism about global economic growth also boosted investors’ sentiments. Back home, in scrip specific development, Loyal Equipments traded jubilantly after the company received purchase order worth Rs 345 lakh from Simon India.

The BSE Sensex is currently trading at 33919.19, up by 106.93 points or 0.32% after trading in a range of 33866.50 and 33998.37. There were 20 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.69%, while Small cap index was up by 1.00%.

The top gaining sectoral indices on the BSE were Metal up by 1.58%, Consumer Durables up by 1.46%, Basic Materials up by 1.42%, Telecom up by 1.01% and Realty up by 0.81%, while Auto down by 0.09% was the lone losing index on BSE.

The top gainers on the Sensex were ICICI Bank up by 1.99%, Adani Ports & SEZ up by 1.41%, Bharti Airtel up by 1.25%, Reliance Industries up by 1.16% and SBI up by 0.86%. On the flip side, Dr. Reddy’s Lab down by 2.38%, Tata Motors down by 0.89%, ONGC down by 0.84%, Infosys down by 0.64% and Maruti Suzuki down by 0.61% were the top losers.

Meanwhile, the Rajya Sabha has given green signal to the Insolvency and Bankruptcy Code (IBC) (Amendment) Bill 2017, which will replace an ordinance promulgated by President Ram Nath Kovind in November to prevent unscrupulous persons from misusing or vitiating the provisions of the IBC. The bill was cleared by the Lok Sabha last week. Union Finance Minister Arun Jaitley has said that the government has entered into an unchartered territory as far as IBC is concerned and would continue to amend the law as it is learning experience. He also noted that Insolvency and bankruptcy is an area in which it is only in the recent years that they have chartered into.

The minister has stated that the government has been encountering situations which were not anticipated earlier and assured the House that it would continue to take corrective action. He noted that the ineligible persons or entities will include undischarged insolvent, wilful defaulter and those whose accounts have been classified as non-performing assets. However, he said that these persons can become eligible to submit a resolution plan if they clear all the overdue amounts with interest and other charges relating to their NPA accounts. Besides, he said that those defaulters who had participated in the insolvency proceedings before November 23 can also bid for stressed assets provided they clear their dues in a month.

Jaitley further said that the whole effort was to make banking sector robust and detach it from politics. He also pointed out that during the insolvency process, banks and unsecured creditors will have to take some haircut and if the same management comes back, nothing would change. He highlighted that the objective of the bill is to allow creditors to move to the National Company Law Tribunal (NCLT) in case of insolvency. He added the resolution process had been started and more than 500 cases disposed of.

The CNX Nifty is currently trading at 10482.75, up by 40.55 points or 0.39% after trading in a range of 10460.55 and 10503.60. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 2.15%, ICICI Bank up by 2.03%, HPCL up by 1.81%, Vedanta up by 1.74% and Tech Mahindra up by 1.65%. On the flip side, Dr. Reddy’s Lab down by 2.58%, Tata Motors down by 0.98%, ONGC down by 0.84%, Maruti Suzuki down by 0.75% and Infosys down by 0.65% were the top losers.

Asian markets were trading mostly in green; KOSPI Index increased 7.11 points or 0.29% to 2,486.76, FTSE Bursa Malaysia KLCI increased 10.36 points or 0.58% to 1,793.06, Hang Seng increased 11.39 points or 0.04% to 30,526.70, Shanghai Composite increased 19.84 points or 0.59% to 3,368.17 and Taiwan Weighted increased 90.84 points or 0.85% to 10,801.57.

On the flip side, Jakarta Composite decreased 86.78 points or 1.37% to 6,252.46.