Local equities continue firm trade

Local equity markets added gains to continue their firm trade in the morning session on account of buying in front line counters. Buoyant Mid-caps and Small-caps were also approaching half a percent gains. Healthcare, Realty and Power counters were on the priority list of the buyers. Likewise, Power Grid, Tata Steel and Kotak Mahindra Bank were also trading higher on the BSE. The domestic sentiments remained upbeat with Commerce and Industry Minister Suresh Prabhu’s statement that the proposed new industrial policy, to be released soon, would help link domestic industry with the global supply chain, He said that the auto component industry has successfully used this linkage to promote the sector’s growth. Traders remained optimistic with Finance Minister Arun Jaitley’s statement that rupee is better off compared to other currencies and also stated that the rupee is falling due to global factors, and virtually has no domestic reasons for the rupee’s current decline. Market-men took note of a private report that India and the US are lined up series of meetings in the next few weeks as the two countries try to iron out their trade differences, even as the ‘two plus two’ dialogue will focus on diplomatic and security issues.

On the global front, Asian markets were trading mixed, with investor confidence shaken by turmoil in emerging markets and jitters over a potentially severe escalation in the US-China trade war. Traders were focused on the Sino-US trade war with a public consultation period on the Trump administration's intent to impose tariffs on an additional $200 billion of Chinese goods. Back home, in scrip specific development, Jindal Stainless gained on eyeing to tap business opportunities in automotive industry. Besides, Aurobindo Pharma surged with arm inking agreement to acquire commercial operations in US.

The BSE Sensex is currently trading at 38145.05, up by 126.74 points or 0.33% after trading in a range of 37983.15 and 38182.77. 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 0.47%, while Small cap index was up by 0.38%.

The top gaining sectoral indices on the BSE were Healthcare up by 1.44%, Utilities up by 0.93%, Realty up by 0.85%, Power up by 0.84% and Energy was up by 0.71%, while Telecom down by 0.63%, TECK down by 0.33% and IT was down by 0.01% were the few losing indices on BSE.

The top gainers on the Sensex were Power Grid up by 3.13%, Tata Steel up by 1.58%, Kotak Mahindra Bank up by 1.54%, Hindustan Unilever up by 1.38% and Coal India was up by 1.32%. On the flip side, Axis Bank down by 1.01%, ONGC down by 0.95%, Vedanta down by 0.59%, Bharti Airtel down by 0.56% and TCS was down by 0.55% were the top losers.

Meanwhile, ICRA in its latest report has said that sharp depreciation in the Indian rupee may help the domestic steel industry lower imports and boost exports in the coming months. Accordingly, this is likely to improve the country's overall steel trade balance. The report highlighted that in the first quarter of current financial year (Q1FY19) steel exports declined by over 33%, whereas imports rose by over 11%, and as a result the country turned a net steel importer, after having been a net exporter for the last two years.

Besides, it stated that while the consumption levels are likely to ease in a seasonally weak second quarter, government's continued thrust on infrastructure spends and expected improvement in rural demand on the back of higher minimum support prices (MSPs) is expected to drive the steel consumption growth momentum in the coming months.

The report also underlined that domestic steel consumption grew at a healthy pace of 9.2% year-on-year in June quarter, compared with 7.9% in FY18, driven by strong automobile sales growth and further uptick in demand for longs by the construction sector before the onset of the monsoon. Moreover, the country's finished steel production growth improved to 5.3 percent Y-o-Y in June quarter, from 3.1% in FY18.

Additionally, ICRA is expecting a sequential easing in operating profitability of the industry in September quarter on account of moderation in demand and increased raw material costs. It added that higher absorption of steel in the domestic market kept steel exports low, despite remunerative international prices.

The CNX Nifty is currently trading at 11509.05, up by 32.10 points or 0.28% after trading in a range of 11459.50 and 11519.95. There were 32 stocks advancing against 18 stocks declining on the index.

The top gainers on Nifty were Power Grid up by 2.96%, Ultratech Cement up by 1.84%, Dr Reddy’s Lab up by 1.76%, GAIL India up by 1.71% and Kotak Mahindra Bank was up by 1.66%. On the flip side, Zee Entertainment down by 5.96%, Hindalco down by 1.48%, Axis Bank down by 1.22%, ONGC down by 0.98% and Tech Mahindra was down by 0.92% were the top losers.

Asian markets were trading mixed, Nikkei 225 declined 89.01 points or 0.4% to 22,491.82, Hang Seng fell 247.06 points or 0.92% to 26,996.79, KOSPI dropped 2.97 points or 0.13% to 2,288.80 and Taiwan Weighted was down by 72.21 points or 0.66% to 10,922.92.

On the other side, Straits Times rose 1.24 points or 0.04% to 3,157.52, Shanghai Composite gained 4.51 points or 0.17% to 2,708.85 and Jakarta Composite was up by 7.64 points or 0.13% to 5,691.14.