Benchmarks hold early gains; FMCG, Auto lead

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 majority of Asian markets were trading in red, despite positive news from US housing permits reached a four-year high, the most since August 2008. Back home, traders were seen piling up position in, FMCG, Auto and IT sector, while selling was witnessed in CG, and Realty sector.ITC, Hindustan Unilever and Nestle India from FMCG pack were seen trading firm in green driving the markets higher. Tata Motors, Mahindra & Mahindra, Hero Moto Corp and Maruti Suzuki from Auto space were trading in green edging the markets higher. On the other hand, L&T, BHEL, SAIL and Siemens from CG pack were trading in red drifting markets lower. In the scrip specific development, Fortis Healthcare gained on reporting rise of 0.52% in its net profit at Rs 13.33 crore for the quarter, as compared to Rs 13.26 crore for the same quarter in the previous year. Tata Global Beverages rose on acquiring balance 49% stake of ‘Grand’ business. The NSE Nifty and BSE Sensex were managing to hold their psychological 5350 and 17700 levels respectively.

The market breadth on BSE was positive in the ratio of 1451:652 while 100 scrips remained unchanged.

The BSE Sensex is currently trading at 17786.53 up 129.32 points or 0.73% after touching a high of 17795.81 and low of 17696.98. There were 23 stocks advancing against 7 declines on the index.

The broader indices were trading on a positive note; the BSE Mid cap index was up by 0.79%, while Small cap index was up by 1.00%.

On the BSE sectoral space, FMCG up by 1.35%, Auto up by 1.06%, IT up by 1.00%, TECk up by 0.82% and Oil & Gas up by 0.72% were the gainers while CG down by 0.12% and Realty down by 0.06% were the only losers on the index.

Tata Motors up by 2.48%, Hindustan Unilever up by 1.78%, ITC up by 1.26%, Infosys up by 1.20%, HDFC up by 1.14% were the major gainers on the Sensex, while Sterlite Industries down by 0.64%, L&T down by 0.58%, Hindalco Industries down by 0.43%, HDFC Bank down by 0.18% and BHEL down by 0.13% were the major losers on the index. 

 Meanwhile, market regulator, Securities and Exchange Board of India (SEBI) has made several changes to the rules governing MFs, IPOs and fund distributors. Retail investors have been taken care of in its latest decision, SEBI plans to usher in electronic IPOs by tapping broker terminal networks, though mutual fund investments have became more expensive. The latest measures also included relief for companies struggling to meet the minimum public holding norms of 25% when it allowed them to issue bonus and rights shares to meet the requirements. The government had mandated that by June 2013 promoters of listed companies should not hold more than 75% stake.

Taking note of the ailing mutual fund industry and its woes like, lack of penetration of mutual fund products, inadequate distribution network, need for greater alignment of the interest of various stakeholders, regulation of distributors and issues concerning investor protection, the market regulator has approved some immediate steps, to accord flexibility and bring cost effectiveness, fungibility of Total Expense Ratio (TER) is allowed. To improve the geographical reach of mutual funds and bring in long-term money from smaller towns, asset management companies (AMCs) are now allowed to charge additional TER (up to 30 bps), depending on the extent of new inflows from locations other than the top 15 cities. SEBI has also recommended to the government to offer equity mutual fund investors the same benefit of taxation proposed under the Rajiv Gandhi Equity Savings Scheme. It is believed that some of these measures could lift the morale of the mutual fund industry.

Further, with a view to increase the reach of IPOs to investors across the country and affording minimum allotment to a larger number of applicants, there were lots of measures announced, including widening of the distribution network of IPOs, in addition to the existing channels, the nationwide broker network of stock exchanges at more than 1000 locations will be made available for distributing IPOs in electronic form, the reach of ASBA would be enhanced by mandating all ASBA banks to provide the facility in all their branches in a phased manner. The share allotment system will be modified to ensure that every retail applicant, irrespective of his application size, gets allotted a minimum bid lot, subject to availability of shares in aggregate.

The S&P CNX Nifty is currently trading at 5,391.60, up by 28.65 points or 0.53% after trading in a range of 5,398.70 and 5,367.55. There were 30 stocks advancing against 19 declines while 1 remains unchanged on the index.

The top gainers on the Nifty were Tata Motors up by 2.23%, Hindustan Unilever up by 1.90%, ITC up by 1.20%, Infosys by 1.15% and ICICI Bank up by 1.08%. While, Ambuja Cement down by 1.25%, Hindalco by 0.90%, Sterlite Industries down by 0.77%, DLF down by 0.74% and LT down by 0.73% were the top losers on the index.

Most of the Asian indices were trading in red ; Nikkei 225 up 0.87%, Hang Seng index up by 0.53%, Straits Times up by 0.11% while Shanghai Composite down by 0.08%, Kospi Composite Index down 0.15%, KLSE Composite down by 0.26%, Taiwan Weighted down by 0.17%, were the only losers. 

Jakarta Composite was not trading as Indonesian banks, the stock exchange and other financial institutions will be closed for five days, from Friday until Wednesday, due to public and Idul Fitri holidays.