Local equities hold positive momentum

Local equity benchmarks continued to hold a positive momentum in the morning session, following gains in FMCG, Realty and Oil & Gas stocks. Among heavy-weights Asian Paints, ITC and Hindustan Unilever exhibited a smart performance. Traders took some encouragement with Reserve Bank’s report that foreign investment of Indian companies grew 18 per cent to $2.69 billion in March as compared to the year-ago period. The domestic firms made investment of $2.28 billion in their subsidiaries and wholly-owned units abroad during March 2018. Traders took note of a private report that Indian companies are lining up to seek dollar-denominated debt as global interest rates soften, but only a few are likely to find it as foreign investors remain wary about the credit quality of many.

On the global front, Asian markets were trading mixed, as volatile week drew to a close with investors preparing for the start of the corporate earnings season. Back home, sugar stock were in focus, as a report stated that the country's sugar exports surged to 17.44 lakh tonnes so far in the current marketing year ending September, as against about 5 lakh tonnes shipped in the entire 2017-18. Besides, RBI’s report stated that Banks closed fiscal 2019 with robust disbursals that rose in double-digits for the second year in row, after the sub-5 percent in FY17, which was the lowest in five decades.

The BSE Sensex is currently trading at 38676.17, up by 69.16 points or 0.18% after trading in a range of 38635.76 and 38721.01. There were 19 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.18%, while Small cap index was up by 0.18%.

The top gaining sectoral indices on the BSE were FMCG up by 0.70%, Realty up by 0.66%, Utilities up by 0.60%, Oil & Gas up by 0.53% and Healthcare was up by 0.41%, while Capital Goods down by 0.41%, Telecom down by 0.36% and Industrials was down by 0.09% were the few losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 1.22%, ITC up by 0.81%, Hindustan Unilever up by 0.76%, Vedanta up by 0.58% and Sun Pharma was up by 0.49%. On the flip side, Tata Motors - DVR down by 1.25%, Bharti Airtel down by 0.86%, Larsen & Toubro down by 0.64%, Tata Motors down by 0.50% and SBI was down by 0.41% were the top losers.

Meanwhile, rating agency ICRA is expecting that the domestic tyre demand will grow in the range of 7-9 per cent over the five year period from 2018-19 to 2022-23. The agency added that the market would also continue to witness investments over the period of next three years.

ICRA’s Vice President and Co-Head, Corporate Ratings K Srikumar said that with a stable demand outlook and strong credit profile, the domestic tyre makers will continue to invest in capacities.  He mentioned ‘based on announcements, the industry is likely to witness a capacity addition of over Rs 20,000 crore in the next three years’.

The revenue growth for tyre industry is pegged at 14-15 per cent for FY19, with operating margin and net margin of 14 per cent and 7 per cent, respectively, almost in line withFY18. For 2019-20 to 2021-22, revenue growth is projected at 9-10 per cent with operating and net margins at 14-15 per cent and 6-7 per cent, respectively.

The CNX Nifty is currently trading at 11609.00, up by 12.30 points or 0.11% after trading in a range of 11600.40 and 11627.20. There were 27 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were GAIL India up by 2.19%, Adani Ports up by 1.16%, Cipla up by 1.15%, Asian Paints up by 1.11% and Ultratech Cement was up by 0.99%. On the flip side, Indiabulls Housing Finance down by 1.05%, UPL down by 0.97%, Hindalco down by 0.92%, Indian Oil Corporation down by 0.92% and Larsen & Toubro was down by 0.70% were the top losers.

Asian markets were trading mixed; Hang Seng decreased 111.46 points or 0.37% to 29,727.99, Taiwan Weighted dropped 17.37 points or 0.16% to 10,791.40, Shanghai Composite declined 14.12 points or 0.44% to 3,175.84 and Straits Times was down by 5.46 points or 0.16% to 3,325.36.

On the other side; KOSPI rose 4.69 points or 0.21% to 2,229.13, Jakarta Composite soared 4.91 points or 0.08% to 6,415.08 and Nikkei 225 was up by 159.14 points or 0.73% to 21,870.52.