Markets continue to trade in green ahead of F&O expiry

Indian equity benchmarks continued to trade in high spirit in early noon session ahead of March F&O expiry, on the back of sustained buying in the blue-chip counters such as Realty, IT, TECK and Consumer Durables. Further, hopes of rate cut by the RBI by 25 basis points in the April policy due to weak economic activity too accelerated buying activity. Sentiment got a boost as the Reserve Bank of India (RBI) in its latest report has showed that bank credit growth increased by 14.46 percent to Rs 95.53 trillion, while deposits grew in double-digits at 10.03 percent to Rs 122.26 trillion for the fortnight ending March 15. In the year-ago fortnight, advances stood at Rs 83.46 trillion and deposits at Rs 111.11 trillion. Traders took a note with a report of finance ministry that currency in circulation as percentage of GDP declined by over 1 percentage points to 10.48 per cent in the two years after demonetization. Meanwhile, the Central Board of Direct Taxes (CBDT) has rung alarm bells and has asked the Income Tax Department to go for a major assault as the direct tax collection target remains short of about 15 per cent, with the financial year closing less than a week away.

On the global front, Asian markets were trading mostly in red, as recession concerns sent bond yields spiralling lower across the globe, overshadowing central bank attempts to calm frayed nerves. Back home, India's apparel exports are expected to remain flat during this financial year and the first half of next year due to decline in overseas demand, especially in the UAE. In scrip specific development, Hotel stocks have declined despite ICRA, a rating agency is expecting that operating margin of industry will improve by approximately 150 basis point to 21- 21.5% during FY2019.

The BSE Sensex is currently trading at 38299.51, up by 166.63 points or 0.44% after trading in a range of 38148.44 and 38379.80. There were 19 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.56%, while Small cap index was up by 0.68%.

The top gaining sectoral indices on the BSE were Realty up by 1.66%, IT up by 1.37%, TECK up by 1.22%, Consumer Durables up by 1.00% and Industrials was up by 0.67%, while Power down by 0.22%, Telecom down by 0.14%, Energy down by 0.03%, Metal down by 0.00% were the few losing indices on BSE.

The top gainers on the Sensex were HCL Technologies up by 2.91%, Sun Pharma up by 2.22%, Yes Bank up by 2.05%, Infosys up by 1.60% and HDFC was up by 1.27%. On the flip side, ONGC down by 2.09%, Power Grid Corporation down by 1.60%, Bajaj Auto down by 1.52%, Indusind Bank down by 1.09% and Tata Steel was down by 0.59% were the top losers.

Meanwhile, Commerce Secretary Anup Wadhawan has said that subsidies provided by India to its farmers are only about $250 per annum per farmer as compared to billions of dollars which western countries give. He also said that India’s subsidies run into trouble as they are not structured properly, so there is a need to learn from other countries.

Wadhawan has stated that developed nations, including the European Union (EU) and the US, have alleged in the World Trade Organization (WTO) that India offers huge subsidies to its farmers. He also said India always maintains that its farm subsidies are well below the WTO's cap of 10 percent. Adding further, he said the US has also dragged India to the WTO's dispute settlement mechanism over export subsidies, saying these incentives were harming American companies, prompting the government to state that it would engage with the Trump administration and explain its position. In the agriculture sector, he said the EU and the US provide huge subsidies but cleverly put those in boxes which are WTO compatible.

Talking about special economic zones (SEZs), Commerce Secretary said there is a need to make these zones as zones of excellence, which should be investor friendly, having state-of-the-art infrastructure. He also stated that there is a need to look at Chinese model of these zones which are spread in a much wider space and added that India's SEZ policy does not get implemented entirely as envisaged. Rather than SEZs, he said India needs coastal economic zones, and noted that incentives should be linked to employment creation. He said that these zones would have significant positive impact on India's economic growth. 

The CNX Nifty is currently trading at 11495.40, up by 50.35 points or 0.44% after trading in a range of 11452.45 and 11521.25. There were 34 stocks advancing against 15 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were Indiabulls Housing up by 3.27%, HCL Technologies up by 2.96%, Adani Ports &Special up by 2.92%, Sun Pharma up by 2.05% and Zee Entertainment was up by 2.00%. On the flip side, ONGC down by 2.34%, Dr. Reddys Lab down by 1.65%, Power Grid Corporation down by 1.65%, Hindalco down by 1.59% and Bajaj Auto was down by 1.05% were the top losers.

Asian markets were trading mostly in red; KOSPI fell 15.78 points or 0.74% to 2,129.84, Shanghai Composite declined 12.41 points or 0.41% to 3,010.31, Hang Seng decreased 38.71 points or 0.13% to 28,689.54, Nikkei 225 slipped 348.04 points or 1.63% to 21,030.69 and Taiwan Weighted was down by 6.44 points or 0.06% to 10,536.26.

On the other hand Straits Times advanced 12.23 points or 0.38% to 3,210.62 and Jakarta Composite was up by 3.92 points or 0.06% to 6,448.66.