Indian equities pare gains; trade continues in green

Indian equity markets pared gains but continued its firm trade in green at the lowest point of the day in the late afternoon session on account of profit booking in frontline counters. The positive sentiment at D-street is mainly on account of global risk-on sentiment and also on Finance Minister P Chidambaram’s decision to ease restrictions for foreign institutional investors in government and corporate bonds next month. Traders were seen piling some position in Realty, Oil & Gas and PSU sector stocks while selling was witnessed in IT, FMCG and TECK sector stock. In scrip specific development, Hindustan Petroleum Corporation (HPCL), Bharat Petroleum Corporation (BPCL) and Indian Oil Corporation (IOC) were trading in green after the OMCs hiked diesel price by 45 paise/litre This is the third hike in a row after the government permitted them to do so two months ago. Geodesic was locked in upper circuit limit after the company stated that its restructuring process is in final legs. Godrej Properties was trading in green after the board of directors of the company approved sub division of equity shares. Hero MotoCorp, Bajaj Auto and TVS Motor were trading under pressure after foreign brokerage house Deutsche Bank  cut its target price on two-wheeler companies stating that they were likely to remain subdued as sales remained slow and competition was rising.

On the global front, Asian markets were trading in green barring Shanghai Composite while the European markets were too trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 5,650 and 18,800 levels respectively. The market breadth on BSE was negative in the ratio of 1319:1421 while 116 scrips remain unchanged.

The BSE Sensex is currently trading at 18,815.85, up by 80.25 points or 0.43% after trading in a range of 18,950.22 and 18,815.81. There were 15 stocks advancing against 14 declines while 1 stock remains unchanged on the index.

The broader indices were trading in green; the BSE Mid cap and Small cap index were trading up by 0.76% and 0.39% respectively.

The top gaining sectoral indices on the BSE were Realty up by 3.13%, Oil & Gas up by 1.68%, PSU up by 1.65%, Power up by 1.60% and Bankex up by 0.70%, while IT down by 0.30%, FMCG down by 0.10%, TECK down 0.09% and Auto down by 0.02% were the losers on the BSE.

The top gainers on the Sensex were ONGC up by 4.66%, NTPC up by 2.83%, Sterlite Industries up by 1.51%, HDFC up by 1.26% and Tata Motors up 1.05%.

On the flip side, Hero MotoCorp down by 1.88%, Wipro down by 0.96%, Bharti Airtel down by 0.95%, ITC down by 0.77% and Tata Steel was down by 0.71% were the top losers on the Sensex.

Meanwhile, worried by declining exports and the rising trade account deficit, Commerce and Industry Minister Anand Sharma said, in the upcoming foreign trade policy (FTP), the interest subsidy scheme could be extended to more export sectors as the country faces a trade deficit crisis because of the contraction in exports. Trade deficit for the first 11-month of the fiscal stood at $182 billion and is expected to reach at $196 billion in the current fiscal.     

In the Board of Trade meeting, that had representatives from finance, external affairs, MSMEs, textiles and DIPP, Sharma expressed the need to enhance the export as declining export is hurting the country’s trade deficit. 'The trade deficit would become unmanageable because it directly impacts the current account deficit, and both of them together put pressure on the valuation of our currency,' he added.

In the first 11-month of this fiscal, India’s exports declined by 4% to $265.95 billion, while, the country’s current account deficit touched an all time high of 4.6% of the GDP in the first half of this fiscal and is estimated to touch 5% this fiscal.

Further, the government is also looking at ways to increase exports through the FTP to bridge the growing deficits in the trade and the current account and bring the balance of payment under control. The commerce ministry is also examining a number of proposals from the industry that include extending direct cash incentives to exporters of a larger number of products to targeted markets. T

The annual FTP is expected to come in the first week of April. The government is also considering an export development fund with a likely corpus of about Rs 5,000 crore to Rs 10,000 to help the exporters in their marketing initiatives.

The CNX Nifty is currently trading at 5,676.10, up by 24.75 points or 0.44% after trading in a range of 5,718.40 and 5,675.95. There were 32 stocks advancing against 18 declines on the index.

The top gainers of the Nifty were DLF up by 5.93%, ONGC up by 4.41%, BPCL up by 3.31%, NTPC up by 3.02% and Reliance Infrastructure up by 2.41%.

On the flip side, Hero MotoCorp down by 1.86%, Asian Paint down by 1.31%, Tata Steel down by 0.95%, Wipro down by 0.93% and ITC down by 0.90% were the major losers on the index.

Majority of Asian equity indices were trading in the green barring Shanghai Composite which was down by 0.07%; while Hang Seng advanced 0.61%, Jakarta Composite surged 1.13%, KLSE Composite jumped 0.88%, Nikkei 225 soared 1.69%, Straits Times increased 0.37%, KOSPI Composite added 1.49% and Taiwan Weighted added 0.77%.

The European markets were trading in green; France’s CAC 40 added 1.28%, Germany’s DAX ascended 0.99% and United Kingdom’s FTSE 100 jumped 0.60%.