Benchmarks continue to trade in green in morning session

Indian equity benchmarks continued their trade in green in morning session on account of buying in frontline blue chip counters. The Indian rupee opened lower against dollar on Tuesday. The dollar held steady recovering a tad from overnight lows ahead of the Federal Reserve meeting. The sentiments were upbeat after RBI data showed that the country’s manufacturing sector witnessed an improvement in sales growth in the third quarter this fiscal on annual basis, though net profit has remained subdued due to lack of support from other income. The sales of manufacturing companies increased by 14% in the October-December quarter of 2017-18 compared to similar period of the previous fiscal while net profit declined by 2.4% in the third quarter. Separately, as per ICRA report the credit to micro, small and medium enterprises (MSMEs) is expected to grow at 12-14 per cent over the next five years, helped by higher lending by non banking finance companies (NBFC) to the segment. The report added that NBFC and housing finance companies are expected to expand at about 20-21 per cent compounded annual growth rate (CAGR) in this space during the period, while bank credit to this segment, which accounted for about 84 per cent of total MSME credit, is estimated to grow at a lower CAGR of 9-11 per cent.

Meanwhile, select telecom stocks were buzzing as the telecom department (DoT) amended telco licence norms to extend the payment tenure for auctioned airwaves from 10 to 16 years and also eased the spectrum holdings caps in step with recent Cabinet decisions. The moves are part of the government’s efforts to boost the health of the beleaguered telecom industry that is saddled with nearly Rs 8 lakh-crore of debt and has seen a plunge in revenues and profits amid continuing price wars. Separately, aviation stocks were trading in green after data showed that domestic air passenger traffic rose by 24.14 per cent in February as compared to the corresponding month last year, helped by an increased tourist-season demand. The data released by DGCA showed that in February, domestic airlines flew 1.07 crore passengers compared to 86.55 lakh passengers flown during the corresponding period last year.

Traders were seen buying in IT, TECK and Consumer Durables stocks, while selling was witnessed in Metal, Bankex and Utilities sector stocks. In scrip specific development, Cipla was trading in red after the US health regulator issued observations to company’s Goa unit. The unit was inspected by the US Food and Drug Administration during January 22-25, 2018. Scooters India was locked at upper circuit limit as the government kicked off the process of selling its entire stake in the company, marking the beginning of strategic sale of loss-making and non-core public sector entities that also has Air India on the list.

On the global front, Asian markets were trading mostly in red. Confidence among Japanese manufacturers edged up in March from three months ago and the service sector’s mood hit a three-year high, signaling solid readings in the central bank's closely-watched quarterly tankan survey. Back home, the BSE Sensex and NSE Nifty were trading above the psychological 33,000 and 10,100 levels respectively. The market breadth on BSE was positive in the ratio of 1155:1054, while 119 scrips remained unchanged.

The BSE Sensex is currently trading at 33023.56, up by 100.44 points or 0.31% after trading in a range of 32810.86 and 33043.78. There were 21 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.30%, while Small cap index was up by 0.13%.

The top gaining sectoral indices on the BSE were IT up by 0.85%, TECK up by 0.77%, Consumer Durables up by 0.60%, Energy up by 0.55% and Telecom up by 0.53%, while Metal down by 0.73%, Bankex down by 0.24%, Utilities down by 0.22% and Basic Materials down by 0.04% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 2.55%, Adani Ports & Special Economic Zone up by 1.26%, Sun Pharma up by 1.08%, Wipro up by 1.01% and Infosys up by 1.00%.

On the flip side, NTPC down by 1.20%, Mahindra & Mahindra down by 0.98%, Kotak Mahindra Bank down by 0.93%, Axis Bank down by 0.55% and Yes Bank down by 0.51% were the top losers.

Meanwhile, in a bid to provide relief to the telecom sector which is reeling under deep financial stress, the Department of Telecom (DoT) has revised licence norms of service providers to raise number of instalments for spectrum payments and radiowaves frequency holding limit. Under the amended norms, the licensee may opt one time for higher number of instalments including in the current financial year 2017-18 (maximum 16 instalments) for deferred payment liabilities as per Notice Inviting Application (NIA) for auctions conducted for award of spectrum in the years 2012, 2013, 2014, 2015 and 2016.

There will be no change in value and interest rate that telecom companies have to pay for the spectrum. But, the total amount that telecom operators will pay for the spectrum will be higher by Rs 74,446.01 crore till 2034-35 if they go for more number of instalments. It will be optional for telecom operators to choose between current number of instalments and increased number of instalments. Earlier to that amendment, a part of spectrum auction amount used to be taken as upfront payment by DoT and the balance, after a two-year moratorium, was paid out every year -- 10 instalments in all.

The DoT has also revised spectrum holding limit of telecom operators, which will provide exit route for loss making mobile service providers. A telecom operator was earlier allowed to hold maximum of 25 per cent of all spectrum allocated in a service area for mobile telephony. Now the current limit has been revised to 35 per cent.

The CNX Nifty is currently trading at 10123.80, up by 29.55 points or 0.29% after trading in a range of 10049.10 and 10131.50. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Bharti Infratel up by 4.66%, Tata Steel up by 2.54%, Eicher Motors up by 1.90%, Tech Mahindra up by 1.90% and HPCL up by 1.43%.

On the flip side, Vedanta down by 5.70%, Cipla down by 2.34%, Indian Oil Corporation down by 1.29%, NTPC down by 1.23% and Mahindra & Mahindra down by 0.94% were the top losers.

The Asian markets were trading mostly in red; Hang Seng decreased 159.16 points or 0.51% to 31,354.60, Nikkei 225 decreased 135.01 points or 0.63% to 21,345.89, Jakarta Composite decreased 69.87 points or 1.11% to 6,219.71, Taiwan Weighted decreased 43.17 points or 0.39% to 11,003.73, Shanghai Composite decreased 9.24 points or 0.28% to 3,270.01 and FTSE Bursa Malaysia KLCI decreased 1.82 points or 0.1% to 1,846.12.

On the other hand, KOSPI Index increased 1.38 points or 0.06% to 2,476.41.