Firm trade prevails; Nifty above 6,050 mark

Indian equity markets continue its firm trade in the late afternoon session on account of buying in frontline counters and taking cues from the European counterparts. The sentiments on the street turned cautious after IMF in its report stated that despite remarkable progress towards developing a stable financial system, India’s financial sector still confronts longstanding impediments to its ability to support growth as well as new challenges to stability. Traders were seen piling some position in Oil & Gas, PSU and Realty sectors while selling was witnessed in IT, TECk and Auto sector. In the scrip specific movement, Mahanagar Telephone Nigam (MTNL) was trading in green on reports that the company will monetize its property in Mumbai and Delhi for which it has mandated property consultant DTZ and Feedback Infrastructure Services. GVK Power & Infrastructure was trading in red as National Stock Exchange has decided to exclude the stock from its F&O segment.

On the global front, all the Asian markets were trading in green barring KLSE Composite while the European markets were too trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,050 and 20,000 levels respectively. The market breadth on BSE was negative in the ratio of 1286:1486 while 136 scrips remain unchanged.

The BSE Sensex is currently trading at 20,066.53, up by 102.50 points or 0.51% after trading in a range of 20,126.55 and 20,023.40. There were 16 stocks advancing against 14 declines on the index.

The broader indices were trading mixed; the BSE Mid cap was up by 0.16% and Small cap index was trading down by 0.09%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 3.23%, PSU up by 2.90%, Realty up by 1.38%, Power up by 1.03% and Capital Goods up by 0.72%. While, IT down by 0.87%, TECk down by 0.78%, Auto down by 0.65%, Health Care down by 0.35% and Consumer Durables down by 0.26% were the top losers on the index.

The top gainers on the Sensex were ONGC up by 7.52%, NTPC up by 3.79%, Maruti Suzuki up by 3.76%, Gail India up by 2.15% and HDFC up by 1.86%.

On the flip side, Wipro down by 6.05%, Hero Moto Corp was down by 2.78%, Hindustan Unilever was down by 1.91%, M&M down by 1.89% and Jindal Steel down by 1.63%,were the top losers on the Sensex.

Meanwhile, the government has decided to put a cap on budgetary allocations for annuity payments for the public private partnership (PPP) projects to do away the burden on future budgets. On the recommendations made by the Inter-Ministerial Task Force, the cabinet committee on economic affairs (CCEA) has approved the budgetary ceilings for annuity commitments under Public Private Partnership (PPP) projects across sectors.

Recommendations of the committee would ensure that the future budgetary options do not get restricted due to annuity payments for PPP projects. Moreover, the government has observed that annuity payments under PPP projects create a burden on future budgets for a long period of time, making the future budgets inflexible and committed.

Further, annuity payments are essential in the nature of deferred budgetary payments and are borne by the government out of the annual budgetary allocations spread over time. Unlike the projects sustained by user charges, annuity-based projects do not have a revenue stream of their own and essentially, rely on payments out of budgetary allocations over the years. Annuity charge is the periodic payment that the government makes to the concessionaire for financing, operation, construction and maintenance of the PPP project. 

Further, the guidelines would be communicated to ministries for adoption within two weeks. These guidelines will streamline the process of structuring and sanction of projects under annuity mode of PPP.

The S&P CNX Nifty is currently trading at 6,069.60, up by 30.40 points or 0.50% after trading in a range of 6,083.40 and 6,057.75. There were 29 stocks advancing against 21 declines on the index.

The top gainers of the Nifty were BPCL up by 9.24%, ONGC up by 7.47%, Maruti Suzuki up by 3.98%, NTPC up by 3.63%, and Bank of Baroda up by 2.42%. On the flip side, Wipro down by 6.08%, Hero Moto Corp down by 2.83%, M&M down by 1.95%, Hindustan Unilever down by 1.92% and Jindal Steel down by 1.67%.

Most of the Asian equity indices were trading in green; Shanghai Composite up by 1.41%, Hang Seng up by 1.12%, Nikkei 225 up by 2.86%, Straits Times up by 0.51%, Jakarta Composite was up by 1.08%, KOSPI Composite up by 0.69% and Taiwan Weighted was up by 1.53%. On the flip side, KLSE Composite was down by 0.25%.

The European markets were trading in green with; France’s CAC 40 added 0.36%, Germany’s DAX edged higher by 0.05% while the United Kingdom’s FTSE 100 gained 0.11%.