Markets trade with traction; Energy stocks lead

Going from strength to strength, local equity markets gathered further ground in the afternoon deals, tracking sharp recovery in Asian, global markets. Sentiment on the street improved with the International Monetary Fund (IMF) suggesting steps to sustain the high growth rate which India has achieved. It said that the country should carry out banking sector reforms; continue with fiscal consolidation, simplify and streamline GST; and renew impetus on reforms. The domestic sentiment was also buoyed with a private report stating that the second quarter of calendar year 2018 saw the biggest ever private equity (PE) investments in India. The PE firms have invested a record $8.2 billion during the quarter ended June 2018, an increase of 60% compared with $5.1 billion in the same period last year. Besides, the rupee recovering from its record low and easing crude oil prices too aided to optimistic milieu. In the sectoral universe, all the indices were trading in the positive territory. Broader indices too equally participated in the gains, with both mid cap and small cap indices were trading up by over 1.25% each. On the sectoral front, textile sector remained in limelight after Textile Commissioner Kavita Gupta said that the technical textiles industry is projected to grow at 20 percent year-on-year and the segment's potential is largely untapped in the country.

On the global front, Asian markets are trading in green, following the positive cues overnight from Wall Street and on news that China has eased restrictions on foreign investment amid rising trade tensions with the U.S. Back home, the BSE Sensex is currently trading at 35306.79, up by 269.15 points or 0.77% after trading in a range of 35099.65 and 35327.82. There were 22 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.26%, while Small cap index was up by 1.40%.

The top gaining sectoral indices on the BSE were Energy up by 2.31%, Consumer Durables up by 2.19%, Oil & Gas up by 2.14%, Metal up by 2.04% and Capital Goods up by 2.04%, while there were no losers on BSE sectoral front.

The top gainers on the Sensex were Tata Steel up by 2.89%, Reliance Industries up by 2.79%, Bajaj Auto up by 2.24%, ONGC up by 2.21% and Vedanta up by 2.11%. On the flip side, Indusind Bank down by 1.57%, Mahindra & Mahindra down by 0.92%, HDFC Bank down by 0.69%, Asian Paints down by 0.61% and Sun Pharma down by 0.22% were the top losers.

Meanwhile, India may withdraw the notification to levy additional import duty on as many as 29 US products, to be effective from August 4, if both the sides are able to sort out the differences over tariffs before that date. A delegation will visit anytime after the mid of next month to finalise the final list of identified products on which a certain kind of announcement would be made by political leaders of both the sides. In a retaliatory move against the tariff hike by Washington, India has hiked customs duty on several goods, including Bengal gram, lentils and artemia, imported from the US.

India is pressing for exemption from high duty imposed by the US on certain steel and aluminium products, resumption of export benefits to certain domestic products under their Generalised System of Preferences (GSP), greater market access for its products from sectors, including agriculture, automobile, auto components and engineering. Nearly 3,500 Indian products from sectors such as chemicals and engineering get duty free access to the US market under the GSP, introduced in 1976. On the other hand, the US is demanding greater market access for its agri and manufacturing products.

The Indian side informed them about huge potential to increase trade in areas like oil and gas and civil aircrafts. India and the US are having two track discussions to increase trade in short and medium term, and identify long term trade potentials. India’s exports to the US in 2017-18 stood at $47.9 billion, while imports were $26.7 billion. The trade balance is in favour of India.

The CNX Nifty is currently trading at 10673.20, up by 84.10 points or 0.79% after trading in a range of 10612.35 and 10681.70. There were 40 stocks advancing against 10 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 3.57%, GAIL India up by 3.55%, Titan Co up by 3.42%, Tata Steel up by 2.80% and Reliance Industries up by 2.70%. On the flip side, Dr. Reddys Lab down by 2.06%, Tech Mahindra down by 1.72%, Indusind Bank down by 1.68%, Mahindra & Mahindra down by 1.04% and Sun Pharma down by 0.72% were the top losers.

Asian markets are trading in green; Nikkei 225 increased 34.12 points or 0.15% to 22,304.51, Straits Times gained 20.79 points or 0.63% to 3,278.36, Hang Seng surged 414.48 points or 1.43% to 28,911.80, Taiwan Weighted jumped 182.63 points or 1.69% to 10,836.91, KOSPI advanced 11.89 points or 0.51% to 2,326.13, Jakarta Composite added 53.56 points or 0.94% to 5,720.88 and Shanghai Composite was up by 60.55 points or 2.13% to 2,847.45.