Benchmarks trade higher in early deals on firm global cues

Buoyed by firm global cues, Indian equity indices have made a positive start snapping four days losing streak. The US markets ended higher overnight ahead of the January-March corporate earnings season. Asian markets too traded firmly in the early deals supported by the report of easing inflation in China from a 10-month high. The country’s inflation came in at 2.1 per cent in March, down from the 10-month-high 3.2 per cent seen the month before and below estimation of 2.4 per cent. Japanese markets too traded in green in early trade as the yen sank to multi-year lows.

Back home, market-men also got some support with the Asian Development Bank’s (ADB) outlook as ADB, in an improvement over disappointing numbers last year, said that domestic consumption could boost India’s slowing economy to 6 percent growth this year, but the country may still fail to reach that level if it does not follow through on reforms to encourage investment. It has also forecasted inflation to ease to 7.2 percent this year from 7.5 percent last year. Additionally, Finance Minister P Chidambaram said that over 340 projects, including 125 new projects are held up for some reasons and has expressed his commitment to remove bottlenecks hampering their implementation, also supported the sentiment.

On the sectoral front, realty witnessed the maximum gain in trade followed by metal and auto while, software and technology remained the only losers on the BSE sectoral space. The broader indices too were trading with traction while, the market breadth on the BSE was positive; there were 998 shares on the gaining side against 524 shares on the losing side while 71 shares remain unchanged.

The BSE Sensex opened at 18,481.47; about 43 points higher compared to its previous closing of 18,437.78, and has touched a high and a low of 18,521.73 and 18458.27 respectively.

The index is currently trading at 18,470.27, up by 32.49 points or 0.18%. There were 21 stocks advancing against 9 declines on the index.

The overall market breadth has made a strong start with 67.71% stocks advancing against 29.24% declines. The broader indices were trading in-line with benchmarks; the BSE Mid cap and Small cap indices were up by 0.49% and 0.57% respectively. 

The top gaining sectoral indices on the BSE were, Realty up by 1.19%, Metal up by 1.13%, Auto up by 0.84%, Power up by 0.81% and Capital Goods up by 0.77% while, IT down by 1.12% and Teck down by 1.01% were the only losers on the sectoral index.

The top gainers on the Sensex were Tata Motors up by 1.87%, Jindal Steel up by 1.59%, ICICI Bank up by 1.38%, Coal India up by 1.31% and Tata Steel up by 1.11%.

On the flip side, Wipro was down by 9.38%, Bharti Airtel was down by 1.51%, Infosys was down by 1.12%, Dr Reddys Lab was down by 1.06% and Bajaj Auto was down by 0.82% were the top losers on the Sensex.

Meanwhile, Chief Economic Advisor Raghuram G Rajan, expressed optimism that Indian economy will grow by over 6% during the current fiscal, however highlighted the deteriorated external environment and its impact on the economy. As per Rajan, Indian economy would clock-in a growth rate of 6.1-6.7% this year.

Summarizing the key global issues, Rajan said the sluggish US macro-economic growth, the tensions in Korean peninsula, Cyprus issues in Europe and concerns about the banking systems in some of the peripheral countries have now become the major concerns for the global economy and these issues will remain in the near-term.

However, Rajan was optimistic towards the domestic economy and said that India is watching the external developments of recent weeks and economy’s growth will pick up by the end of the year.  Regarding inflation, Rajan said, inflation has been contained at very subdue levels month on month, while the big issue is to bring food prices under control. However, indications are good for the Indian harvest which would help control food prices, he added.

On foreign direct investment (FDI), he said that the FDI takes time to come - so changing the caps will be the indications of the broader directions of the reforms that will be going in and we will look at the FDI very carefully.

The CNX Nifty opened at 5,568.75; about 25 points higher as compared to its previous closing of 5,542.95, and has touched a high and a low of 5,580.60 and 5,563.40 respectively.

The index is currently trading at 5,565.85, up by 22.90 points or 0.41%. There were 40 stocks advancing against 10 declines on the index.

The top gainers of the Nifty were Cairn up by 2.96%, Tata Motors up by 2.06%, Ambuja Cements up by 2.05%, ACC up by 1.72% and Jindal Steel up by 1.71%.

On the flip side, Bharti Airtel down by 1.41%, Infosys down by 1.13%, Dr Reddys Lab down by 0.97%, Bajaj-Auto down by 0.91% and Asian Paint down by 0.49%, were the major losers on the index.

Most of the Asian equity indices were trading in green; Shanghai Composite rose 9.83 points or 0.44% to 2,221.42, Hang Seng surged 200.04 points or 0.92% to 21,918.09, Jakarta Composite increased 10.93 points or 0.22% to 4,908.45, KLSE Composite added 2.00 points or 0.12% to 1,689.99, Nikkei 225 jumped 36.43 points or 0.28% to 13,229.02 and Straits Times was up by 21.42 points or 0.65% to 3,306.03.

On the flip side, KOSPI Composite declined 14.90 points or 0.78% to 1,903.79 and Taiwan Weighted was down by 26.39 points or 0.34% to 7,726.40.