Dalal Street hovers near day’s high

Indian benchmarks continued their up-move and are hovering near their day’s high in the early noon session. Sentiments remained upbeat with a report stating that Banks’ credit increased by 12.64% to Rs 85,51,099 crore in the fortnight ended May 11, 2018 from Rs 75,90,941crore in the fortnight ended May 12, 2017. The report added that Banks’ deposits grew by 7.61 percent to Rs 1,13,92,165 crore in the fortnight ended May 11, 2018, compared with Rs 1,05,86,083 crore in the fortnight ended May 12, 2017. Investors also took some support from Union Oil Minister Dharmendra Pradhan’s statement that the Centre is deliberating on an ‘immediate solution’ to deal with rising fuel prices. Besides, buying in frontline blue chip stocks such as Tata Steel, Infosys and Indusind Bank helped markets to trade near intra-day high points.

On the global front, Asian markets were exhibiting mixed trend as traders were a bit cautious after US President Donald Trump scrapped a key summit with North Korea. However, investors’ fears were calmed after North Korean Vice Foreign Minister Kim Kye Gwan said Pyongyang still hoped for a “Trump formula” to resolve the standoff over its nuclear weapons programme, noting that North Korea was open to resolving issues with the United States.

Back home, stocks related to retail sector was in limelight as a private report stated that the Indian retail sector has attracted Rs 1,000 crore private equity investment in the March 2018 quarter, taking the cumulative investment since 2015 to Rs 5,500 crore. Besides, the broader indices were outperforming their larger peers. In scrip specific development, Tata Consultancy Services (TCS) edged higher by around a percent as its market capitalisation (market-cap) crossed Rs 7 trillion mark.

The BSE Sensex is currently trading at 34847.31, up by 184.20 points or 0.53% after trading in a range of 34700.52 and 34869.60. There were 22 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained by 0.85%, while Small cap was index up by 0.72%.

The top gaining sectoral indices on the BSE were IT up by 1.38%, TECK up by 1.27%, Utilities up by 1.25%, Oil & Gas up by 1.12% and Auto up by 0.99%, while Healthcare down by 0.06% was the only losing index on BSE.

The top gainers on the Sensex were Tata Steel up by 2.43%, Infosys up by 1.91%, Indusind Bank up by 1.69%, ONGC up by 1.43% and Hindustan Unilever up by 1.42%. On the flip side, SBI down by 1.60%, ITC down by 1.06%, Coal India down by 0.91%, HDFC down by 0.22% and Tata Motors - DVR down by 0.21% were the top losers.

Meanwhile, Credit rating agency, ICRA in its latest report has said that the share of diesel passenger vehicles (PVs) in the domestic market, which dropped to 38 percent in 2017-18, is likely to fall below 25 percent post implementation of BSVI emission norms from April 2020. It pointed out that regular increase in the retail price of diesel in small doses every month since January 2013 has significantly narrowed down the retail price gap between petrol and diesel fuels, making cost economics of owning a diesel PV relatively less favourable now than in the past.

According to the report, as there is a high correlation between petrol and diesel price gap, lower fuel price gap has resulted in customer preference shifting away from diesel vehicles. Moreover, it said that given superior fuel economy of hybrid cars, hybridisation has also reduced importance of diesel models. It noted that lastly, the implementation of BSVI norms too will significantly widen the cost differential between petrol and diesel cars, leading to the eventual decline of share of diesel vehicles. It added that once BSVI emission norms come into force from April 2020, prices of diesel cars are expected to go up by about Rs 75,000 as compared to relatively modest Rs 20,000 of petrol cars.

The report further highlighted that currently, a diesel PV is priced about Rs 90,000 - Rs 1 lakh higher as compared to its petrol counterpart but with advent of Euro VI norms, this gap will increase further to Rs 1.5 lakh to Rs 1.75 lakh, thereby further reducing advantage of higher fuel efficiency. It also said that small car buyers will therefore find diesel cars uneconomical due to higher break-even. However, it noted that SUVs will continue to be dominated by diesel, though their share too is expected to reduce to sub-60 percent level over next 4 years from over 80 percent level at present.

The CNX Nifty is currently trading at 10572.65, up by 58.80 points or 0.56% after trading in a range of 10524.00 and 10578.30. There were 35 stocks advancing against 15 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 3.31%, Bajaj Finserv up by 3.03%, GAIL India up by 2.67%, Tata Steel up by 2.48% and Infosys up by 2.05%. On the flip side, Vedanta down by 3.15%, SBI down by 1.58%, Bharti Infratel down by 1.48%, Grasim Industries down by 1.05% and Coal India down by 1.04% were the top losers.

Asian markets were exhibiting mixed trend; Taiwan Weighted increased 5.37 points or 0.05% to 10,942.30, Nikkei 225 advanced 13.78 points or 0.06% to 22,450.79, FTSE Bursa Malaysia KLCI strengthened 19.54 points or 1.1% to 1,795.20 and Jakarta Composite soared 35.02 points or 0.59% to 5,981.55.

On the flip side, Hang Seng decreased 148.26 points or 0.48% to 30,612.15, Shanghai Composite declined 12.67 points or 0.4% to 3,141.98 and KOSPI Index was down 6.91 points or 0.28% to 2,459.10.