Indices extend gaining momentum; Sensex climbs over 200 points

Indian equity markets extended their gaining momentum in the early noon session with Sensex posting gain of more than 200 points and Nifty trading above 11,400 mark supported by buying in frontline blue chip stocks such as ICICI Bank, SBI and Coal India among others. There was strength visible in banks, metal and energy sectors. Sentiments on the street were optimistic with a report showing that foreign investors have poured in over Rs 2,300 crore in the Indian capital markets in July, after pulling out funds for three months in a row. Meanwhile, Central government suggested that there is a need to pause on rate cuts for the time being due to the shortfall of over Rs 40,000 crore in goods and services tax collection. Besides, strengthening of Indian rupee against the dollar also boosted the domestic sentiments.

On the global front, most of the Asian markets were trading in green led by gains in Hong Kong. Back home, the market breadth on the BSE was positive; out of 2508 stocks traded, 1499 stocks advanced, while 860 stocks declined and 149 stocks remained unchanged. The broader indices were also trading in green. Amongst the Mid cap stocks, Rajesh Exports and Shriram Transport Finance stocks were gaining the most and amongst the Small cap stocks IDFC and Info Edge were gaining. In scrip specific development, Maruti Suzuki rose on maintaining double-digit sales growth forecast for FY19.

The BSE Sensex is currently trading at 37765.89, up by 209.73 points or 0.56% after trading in a range of 37643.29 and 37805.25. 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 0.38%, while Small cap index up by 0.59%.

The top gaining sectoral indices on the BSE were Bankex up by 1.18%, Metal up by 1.06%, Energy up by 0.85%, Consumer Durables up by 0.73%, PSU up by 0.70%, while there were no losers on the BSE sectoral index.

The top gainers on the Sensex were Axis Bank up by 3.37%, ICICI Bank up by 3.02%, SBI up by 2.31%, Coal India up by 2.10% and Hero MotoCorp up by 1.48%. On the flip side, Hindustan Unilever down by 1.43%, Kotak Mahindra Bank down by 1.28%, Sun Pharma down by 0.83%, Wipro down by 0.45% and Indusind Bank down by 0.44% were the top losers.

Meanwhile, with the United States (US) imposing an additional 25 percent tariff on about $34 billion worth of Chinese goods, the Confederation of Indian Industry (CII) has said that some Indian products may become more competitive. It also said that India must focus on the US market for items including machinery, electrical equipment, vehicles and transport parts, chemicals, plastics and rubber products. It added that India can focus on numerous goods for expanding its exports to the US and China markets following the hike in duties by both countries on imports from each other.

The industry chamber has stated that top exports from India to the US which are covered in the list of items for which tariffs have been hiked include pumps, parts of military aircraft, parts for electrodiagnostic apparatus, passenger vehicles of 1500-3000 cc, valve bodies and parts of taps. It indicated that exports of these items stood at over $50 million in 2017 and can be increased with concerted efforts. It noted that countries such as Vietnam, Indonesia, Thailand and Malaysia have increased their exports of these products to the US in recent years.

According to the CII, the trade dialogue with the US should be strategized taking into account India's competitive advantage in these products. Besides, it said that foreign direct investments from the US should be encouraged by boosting confidence of US firms in India's business climate. It pointed out that that this might necessitate addressing their concerns regarding non-tariff barriers in India for better long term outcomes. In the domestic industry, it stated that it is important for India to enhance productivity while adding technology to its domestic production in the identified products.

The CNX Nifty is currently trading at 11411.90, up by 51.10 points or 0.45% after trading in a range of 11377.95 and 11427.65. There were 31 stocks advancing against 18 stocks declining on the index, while 1 stock remained unchanged.

The top gainers on Nifty were Axis Bank up by 3.31%, ICICI Bank up by 2.93%, UPL up by 2.34%, SBI up by 2.29% and Coal India up by 1.88%. On the flip side, Hindustan Unilever down by 1.61%, Kotak Mahindra Bank down by 1.26%, Dr. Reddys Lab down by 1.16%, Sun Pharma down by 0.96% and Lupin down by 0.90% were the top losers.

Most of the Asian counters were trading in green; Jakarta Composite increased 76.81 points or 1.26% to 6,084.35, Straits Times soured 31.34 points or 0.95% to 3,297.07, Hang Seng surged 138.93 points or 0.5% to 27,815.25 and Taiwan Weighted increased 11.67 points or 0.11% to 11,024.10.

On the contrary, Shanghai Composite decreased 22.06 points or 0.81% to 2,718.38. KOSPI slipped 2.51 points or 0.11% to 2,285.17 and Nikkei 225 decreased 17.86 points or 0.08% to 22,507.32.