Benchmarks continue to trade in green; Bankex, Industrials lead

Indian equity benchmarks continued their trade in green in morning session on account of buying in front line blue chip counters. Investors await corporate earnings and Union Budget. A clutch of companies are set to come out with their Q3 earnings report card today. Some of the major ones are Wipro, Reliance Industries, ITC, HDFC Bank, Kotak Mahindra Bank, ICICI Prudential, Jaiprakash Associates and Jubilant FoodWorks. The rupee firmed up against the dollar in opening session rising for a third straight day on increased selling of the US currency by exporters and banks.

Sentiments remained up-beat after the India Ratings and Research (Ind-Ra), a subsidiary of Fitch Ratings, projected that the country’s economic growth will improve to 7.1 percent in the next fiscal year 2018-19 from 6.5 percent in the current year 2017-18. The agency termed the Goods and Services Tax (GST) and insolvency law major drivers for the growth of Indian economy. It expects greater allocation of funds to farm and rural sectors in 2018- 19 Budget, which is unlikely to be a populist one despite the impending 2019 general election. Separately, the GST Council has decided to slash rates on 29 items, mainly handicrafts, to 0% while the rates of 49 other items have also been rationalized. The decision was taken during the GST Council’s 25th meeting held yesterday.

Traders were seen piling up position in Bankex, Industrials and PSU stocks, while selling was witnessed in TECK, Telecom and IT sector stocks. In scrip specific development, Wonderla Holidays, Jain Irrigation, Gitanjali Gems and TBZ gained post GST meet. Bharti Airtel, the leading telecom operator was trading in red as third-quarter net profit fell 39%, missing estimates and dropping for the seventh straight quarter, as a cut in interconnection usage charges (IUC) compounded the pressure on its voice and data businesses amid the continuing market disruption by Reliance Jio Infocomm. Profit dropped to Rs 306 crore in October-December, from Rs 504 crore a year earlier.

On the global front, the Asian markets were trading mostly in green, although losses on Wall Street slowed the advance. China’s economy grew faster than expected in the fourth quarter of 2017, as an export recovery helped the country post its first annual acceleration in growth in seven years, defying concerns that intensifying curbs on industry and credit would hurt expansion. Back home, the BSE Sensex and NSE Nifty were trading above the psychological 35,300 and 10,800 levels respectively. The market breadth on BSE was positive in the ratio of 1381:1076, while 91 scrips remained unchanged.

The BSE Sensex is currently trading at 35396.95, up by 136.66 points or 0.39% after trading in a range of 35221.16 and 35434.08. There were 18 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.29%, while Small cap index was up by 0.58%.

The top gaining sectoral indices on the BSE were Bankex up by 0.92%, Industrials up by 0.79%, PSU up by 0.77%, Capital Goods up by 0.76% and Realty up by 0.76%, while TECK down by 0.67%, Telecom down by 0.66%, IT down by 0.57%, Utilities down by 0.18% and Auto down by 0.05% were the top losing indices on BSE.

The top gainers on the Sensex were Adani Ports & Special Economic Zone up by 2.94%, SBI up by 1.83%, Yes Bank up by 1.40%, Larsen & Toubro up by 1.09% and Reliance Industries up by 1.04%.

On the flip side, Infosys down by 1.36%, Wipro down by 1.18%, Bharti Airtel down by 0.67%, Mahindra & Mahindra down by 0.62% and Sun Pharma down by 0.56% were the top losers.

Meanwhile, ahead of the Union Budget for 2018-19, finance minister Arun Jaitley held consultations with finance ministers of various states who offered their inputs on various budgetary measures and called for higher budgetary allocations. The meeting was attended by the chief ministers of Himachal Pradesh and Puducherry, the deputy chief ministers of Bihar, Delhi, Gujarat, Manipur and Tamil Nadu, 14 finance ministers/ministers representing their States, among others.

Though, the suggestions by various states were not disclosed, but is said that Andhra Pradesh has sought Rs1500 crore to develop industrial estates and a waiver of revenue deficit norms.Tamil Nadu suggested including the surcharge on the super-rich and other surcharges in the divisible pool of resources to the States and requested to raise the standard deduction permitted for the personal income tax from Rs1.50 lakh to Rs 2.50 lakh and accord similar revision for elderly people.

Deputy Chief Minister and Finance Minister of Bihar Sushil Kumar Modi said that economically backward States like Bihar needed additional central assistance so as to develop at a faster pace, while some States also sought higher devolution of resources on the ground that fund allocations had been reduced from the Centre due to reduction of horizontal devolutionary share, with the setting up of the 15th Finance Commission.

The Union Finance ministry in its statement after the meeting said that the suggestions made by the States and Union Territories in the meeting and the memorandum submitted by them would be duly examined and suitably considered while formulating the Budget proposals of 2018-19, keeping in consideration with the spirit of cooperative federalism.

The CNX Nifty is currently trading at 10847.65, up by 30.65 points or 0.28% after trading in a range of 10793.90 and 10857.70. There were 28 stocks advancing against 22 stocks declining on the index.

The top gainers on Nifty were Adani Ports & Special Economic Zone up by 2.64%, Indiabulls Housing up by 1.64%, SBI up by 1.53%, HPCL up by 1.21% and Tata Steel up by 1.14%.

On the flip side, GAIL India down by 1.60%, Ultratech Cement down by 1.49%, Infosys down by 1.21%, Aurobindo Pharma down by 1.15% and Lupin down by 1.05% were the top losers.

The Asian markets were trading mostly in green; KOSPI Index increased 2.31 points or 0.09% to 2,518.12, FTSE Bursa Malaysia KLCI increased 3.58 points or 0.2% to 1,825.18, Shanghai Composite increased 13.37 points or 0.38% to 3,488.13, Nikkei 225 increased 24.24 points or 0.1% to 23,787.61, Hang Seng increased 41.41 points or 0.13% to 32,163.35 and Taiwan Weighted increased 49.91 points or 0.45% to 11,121.48.

On the other hand, Jakarta Composite decreased 22.83 points or 0.35% to 6,449.84.