Indian markets continue to trade in fine fettle

Indian equity markets continued to trade in fine fettle in the early noon session on account of value-buying in select blue-chip stocks such as Axis Bank and ICICI Bank stocks. Besides, energy index gained the most followed by oil & gas, metal, PSU and utilities. Strengthening of rupee against the dollar also supported the recovery.  Investors took some encouragement with State Bank of India’s report that Indian rupee may be set to recover as oil peaks out and investors realize the currency has been sold off too heavily amid the emerging-market rout. Some support also came with Employees Provident Fund Organisation’s (EPFO) new payroll data showing that nearly 10 lakh jobs were created in the formal sector in July. This is the highest accretion in any month since September last year, for which the first monthly payroll data is available. However, indices pared some of their gains with Sensex breaching its 37,400 level. 

On the global front, all the Asian markets were trading in green. Japanese stocks edged higher led by an upbeat Wall Street performance, with commodity stocks rising as investors appeared to gravitate to the view that the US-China trade row would be less damaging to growth than first feared. Back home, in scrip specific developments, Power Grid surged on getting investment approvals and Dion gained on launching WIN platform at Annual Wealth Management Conference 2018.

The BSE Sensex is currently trading at 37395.92, up by 274.70 points or 0.74% after trading in a range of 37202.94 and 37489.24. There were 25 stocks advancing against 6 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index rose 0.26%, while Small cap index was down by 0.02%.

The top gaining sectoral indices on the BSE were Energy up by 1.93%, Oil & Gas up by 1.87%, Metal up by 1.84%, PSU up by 1.59% and Utilities up by 0.95%, while IT down by 0.97%, TECK down by 0.73% and FMCG down by 0.09% were the few losing indices on BSE.

The top gainers on the Sensex were Axis Bank up by 3.48%, ICICI Bank up by 3.16%, Tata Steel up by 2.97%, Mahindra & Mahindra up by 2.58% and SBI up by 2.43%. On the flip side, Yes Bank down by 19.86%, Infosys down by 1.79%, Hindustan Unilever down by 1.70%, Sun Pharma down by 0.59% and TCS down by 0.29% were the top losers.

Meanwhile, the India Ratings and Research (Ind-Ra) in its latest report has retained its outlook on India’s overall transport infrastructure sector including toll roads, annuity roads, hybrid annuity model (HAM) projects and airports at ‘stable’ for rest of fiscal year 2019 (FY 2019), except for coal-based thermal power, which continues with its negative outlook. The rating agency said that the outlook on airports reflects limited upward rating movements but it expects continued growth in passenger volumes despite capacity constraints. Besides, it expects revenue for toll roads to grow at around 9% y-o-y in FY19, supported by toll rate growth of about 4.2%. 

For HAM projects, it said that although these projects have enabled resumption of private participation, there is some pressure on the financial closure front, as banks, especially public sector lenders, are going slow on financing there projects due to lack of appetite and lending freeze on many of these lenders. Regarding annuity roads, it said that National Highways Authority of India (NHAI) has demonstrated its stable payment track record across the Ind-Ra rated projects over the years.

Ind-Ra stated that the non-pit head plants, for coal-based thermal power, are facing irregular coal supply, leading to a high risk of declaring availability lower-than-required/normative level. It further also added that competition in short-term market is expected to deepen if there are postponement in dealing with these problems and absence of long-term power purchase pacts.

The CNX Nifty is currently trading at 11317.10, up by 82.75 points or 0.74% after trading in a range of 11263.60 and 11346.80. There were 40 stocks advancing against 10 stocks declining on the index.

The top gainers on Nifty were Bharti Infratel up by 4.06%, Indian Oil Corporation up by 3.58%, Axis Bank up by 3.53%, ICICI Bank up by 3.22% and HPCL up by 3.08%. On the flip side, Yes Bank down by 19.99%, Tech Mahindra down by 1.99%, Hindustan Unilever down by 1.64%, Infosys down by 1.60% and Indiabulls Housing down by 1.32% were the top losers.

All the Asian markets were trading in green; Hang Seng increased 311.87 points or 1.12% to 27,789.54, Shanghai Composite increased 42.82 points or 1.54% to 2,772.06, Nikkei 225 increased 195.00 points or 0.82% to 23,869.93, Taiwan Weighted increased 141.00 points or 1.29% to 10,972.41, Straits Times increased 40.42 points or 1.25% to 3,220.85, Jakarta Composite increased 4.05 points or 0.07% to 5,935.32 and KOSPI increased 8.81 points or 0.38% to 2,332.26.