Local bourses continue to show splendid performance; FMCG stocks shine

On the first trading session of fresh F&O series, barometer gauges were displaying a splendid performance in the early noon session as June-quarter earnings boosted investors’ confidence. Besides, FMCG, Metal and Energy counters were the major pockets of strength, while Information Technology (IT) was the only loser on BSE space. Sentiments remained up-beat with a private report stating that trading across borders, payment of indirect taxes and insolvency resolution are the three sets of reforms where India is upbeat, ahead of the release of the World Bank’s ease of doing business report later this year. Meanwhile, a report stated that the BRICS nations resolved to strengthen multilateral trading system and called upon member countries of the World Trade Organisation to abide by the rules, amid ongoing trade disputes between major economies. The report also stated that the BRICS nations also re-affirmed the centrality of the ‘rules-based, transparent, non-discriminatory, open and inclusive multilateral trading system’. On the sectoral front, stocks related to Oil & Gas sector were in limelight with Minister of State for External Affairs V K Singh stating that there is scope for India and Vietnam to deepen cooperation in the oil and gas sector despite ‘all the troubles’ the Southeast Asian country faces.

On the global front, Asian markets were trading mostly in green with modest gains as easing worries about trade wars and higher oil prices, lifted shares.  Back home, in scrip specific development, shares of ITC surged after the company reported a better-than-expected 10% year-on-year jump in net profit at Rs 2,818.68 crore in June quarter (Q1FY19) and SBI Life Insurance shares rose after it reported a 13% rise in net profit to Rs 350 crore for the June quarter, compared to Rs 310 crore in the year ago period.

The BSE Sensex is currently trading at 37273.36, up by 288.72 points or 0.78% after trading in a range of 37134.88 and 37327.00. There were 23 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.84%, while Small cap index up by 0.75%.

The top gaining sectoral indices on the BSE were FMCG up by 1.98%, Metal up by 1.15%, Energy up by 1.09%, Telecom up by 1.02% and Realty up by 0.90%, while IT down by 0.01% were the losing indices on BSE.

The top gainers on the Sensex were ITC up by 4.84%, Tata Motors - DVR up by 3.96%, Tata Motors up by 2.75%, Bajaj Auto up by 1.84% and Hero MotoCorp up by 1.84%. On the flip side, Adani Ports down by 1.83%, Hindustan Unilever down by 1.18%, Yes Bank down by 1.12%, TCS down by 0.62% and Power Grid down by 0.52% were the top losers.

Meanwhile, in a bid to bring down high power cost of the industry, the proposed new industrial policy is likely to suggest use of Aadhaar for providing free or subsidized power to farmers and poor households and listing of distribution companies to promote transparency in their operations. The commerce and industry ministry is very keen to lower the cost of power in order to boost manufacturing and promote ease of doing business.

The power tariff for the industry in India at about Rs 8 per unit is very high compared to that in developed countries and other emerging economies, and there is a need to bring it down with a view to promote the Make in India initiative. Aadhaar-linked direct benefit transfer mechanism for providing subsidised power to agriculture sector and poor households would check pilferage in power distribution. These initiatives would help in rationalising cost of power for industries.

The new policy will replace the industrial policy of 1991 which was prepared in the backdrop of balance of payment crisis. The proposed policy aims at promoting emerging sectors and modernising existing industries. It will also look to reduce regulatory hurdles and encourage adoption of frontier technologies such as robotics and artificial intelligence.

The CNX Nifty is currently trading at 11240.15, up by 72.85 points or 0.65% after trading in a range of 11210.25 and 11253.90. There were 32 stocks advancing against 17 stocks declining on the index, while 1 stock remained unchanged.

The top gainers on Nifty were ITC up by 4.94%, Hindalco up by 3.39%, Tata Motors up by 2.98%, Eicher Motors up by 1.98% and Hero MotoCorp up by 1.92%. On the flip side, Dr. Reddys Lab down by 1.97%, Grasim Industries down by 1.89%, Adani Ports down by 1.75%, Hindustan Unilever down by 1.32% and Yes Bank down by 1.20% were the top losers.

Asian markets were trading mostly in green; Taiwan Weighted increased 65.17 points or 0.59% to 11,075.78, Jakarta Composite increased 17.84 points or 0.3% to 5,963.98, KOSPI increased 4.28 points or 0.19% to 2,293.34 and Nikkei 225 increased 125.88 points or 0.55% to 22,712.75.

On the flip side, Straits Times decreased 8.79 points or 0.26% to 3,319.81, Hang Seng decreased 42.37 points or 0.15% to 28,738.77 and Shanghai Composite decreased 3.49 points or 0.12% to 2,878.74.