Indian equities continue to trade firm

Indian equities continued to trade in fine fettle on back of strong buying in frontline counters in the late morning session. While, on the global front, the Asian markets were majorly trading in red with most of the indices trading lower by about quarter to half a percent after Moody’s Investors Service cut the outlooks for Germany, the Netherlands and Luxembourg to negative, further aggravating European concern. Japanese market was losing the most as yen strengthened. The US markets closed in red on some disappointing corporate news and after new sovereign concerns emerged from Spain, along with additional Greek drama, sparking sell-off in the markets. Back home, traders were seen piling up position in FMCG, Metal and Bankex sector while selling was witnessed in CG, Realty & Gas and TECk sector. Meanwhile, there is likely to be some jitter in the derivative market as market regulator Sebi has hiked the benchmark liquidity level for any scrip to be eligible for trading in the derivatives segments. There were some good result from the FMCG sector stocks and they may remain buzzing, HUL, Dabur and Colgate have reported 20% jump in their first quarter sales. OMCs will be in lime light after they raised petrol prices by at least 70 paise per litre effective midnight. The NSE Nifty and BSE Sensex were trading above their psychological 5100 and 16900 levels respectively. The market breadth on BSE was positive in the ratio of 1081:878 while 112 scrips remained unchanged.

The BSE Sensex is currently trading at 16903.35 up by 26.00 points or 0.15% after trading as high as 16953.94 and as low as 16884.32. There were 16 stocks advancing against 14 declines on the index.

The broader indices were trading on a positive note; the BSE Mid cap index up 0.19% while Small cap index was up 0.27%.

On the BSE sectoral space, FMCG up by 1.32%, Metal up by 0.41%, Bankex up by 0.34%, CD up by 0.30% and Oil & Gas up by 0.20% there were gainers on the index while CG down by 0.63%, Realty down by 0.55%, TECk down by 0.29%, IT down by 0.29%, and HC down by 0.17% were the losers on the index.

Hindustan Unilever up by 4.55%, Sterlite Industries up by 2.56%, Maruti Suzuki up by 1.58% Hindalco Industries up by 1.03% and Jindal Steel up by 0.89% were the gainers on the Sensex, while Wipro down by 3.04%, BHEL down by 1.50%, Sun Pharma down by 1.48%, Dr Reddys Lab down by 1.16% and Hero Moto Corp down by 0.85% were the major losers in the index.

Meanwhile, market regulator, Securities and Exchange Board of India (SEBI) has revised the eligibility criteria for stocks in derivatives segment, according to which the benchmark liquidity level for any scrip to be eligible for trading in the derivatives segments has been hiked. The minimum Median Quarter Sigma Order Size (MQSOS) requirement for a stock to be eligible for introduction in derivatives segment has been revised to Rs 10 lakh from the present Rs 5 lakh.

Apart from this, minimum market wide position limit to retain its spot once the stock is listed in futures and options (F&O) segment, too has been raised from Rs 60 crore to Rs 200 crore. Also the minimum MWPL requirement for a stock to be eligible for introduction in derivatives segment has been revised to Rs 300 crore from the present minimum MWPL requirement of Rs 100 crore.

An additional criterion of 'stock derivatives to have average monthly turnover in derivatives segment for last three months of Rs 100 crore' has also been decided to be implemented for a stock to be retained in derivatives segment.

The F&O segment could lose at least 20% of its stocks once the new norms announced by the SEBI’s for including and retaining stocks in the segment take effect. SEBI has directed that no fresh month contract shall be issued on stocks that may exit the F&O segment, however, the existing unexpired contracts may be permitted to trade till expiry and new strikes may also be introduced in the existing contract months.

There are 226 stocks in the National Stock Exchange’s F&O list and around 50 of them are likely to lose their eligibility to trade in futures and options after the implementation of the new norms.

The S&P CNX Nifty is currently trading at 5,125.90, up by 7.95 points or 0.16% after trading as high as 5,139.40 and as low as 5,116.75. There were 27 stocks advancing against 23 declines on the index.

The top gainers on the Nifty were Hindustan Unilever up by 4.63%, Sterlite Industries up by 2.36%, Maruti up by 1.67%, ACC by 1.59% and Axis Bank up by 1.56%. While, Wipro down by 3.09%, Sun Pharma  down by 1.60%, BHEL down by 1.46%, DR Reddy down by 1.07% and IDFC down by1.02% were the major losers on the index.

Most of the Asian equity indices were trading in red; KLSE Composite down 0.29%, Hang Seng index down by 0.05%, Jakarta Composite was down by 0.28%, Nikkei 225 down 0.02%, Taiwan Weighted down 0.25% and Shanghai Composite down 0.02%,while Kospi Composite Index up 0.19% and Straits Times up 0.57% were only the gainers on indices