Sensex, Nifty continue to trade in green

Indian benchmarks have continued to trade in the green holding on to their gains through the late morning session on the back of positive global cues and broadly positive regional sentiment on hopes for more monetary easing, but traders are cautious ahead of April derivatives expiry and speculations about the strength of the recent rally. Sentiments have remained firm on expectations that easing inflation and weak commodity prices might prompt the Reserve Bank of India to cut interest rate in its monetary policy meeting on May 3. On the global front, Most of the Asian equity indices were trading in the positive terrain with Japanese benchmark surging over half a percent on expectations that yen weakness will spur strong earnings growth for Japanese firms. Meanwhile, South Korean shares edged higher by about half a percent after country’s economy grew the most in two years in the first quarter as the government front-loaded spending and exporters weathered the slide in the yen that aids rivals in Japan.

Back home, the traders were seen piling up positions in Oil & Gas, Auto and PSU, while selling was seen in IT, Teck and Consumer Durables sector. In scrip specific actions, Mahindra and Mahindra Financial Services  rose after reporting a healthy 43% year-on-year (yoy) growth in its consolidated net profit at Rs 346 crore for the four quarter ended March 2013 (Q4) on the back of growth in loan disbursements in the semi-urban and rural areas. Jet Airways gained on news of Etihad picking up a 24 percent stake in the company at a substantial premium to the market price. Axis Bank soared as it reported a forecast beating 22 percent year-on-year rise in its fourth quarter (Jan-March) net profit at Rs 1,555 crore. Net interest income (NII) or the difference between interest earned and paid out, rose 24 percent YoY to Rs 2,665 crore.

Meanwhile, the NSE Nifty and BSE Sensex were trading just above their psychological 5,850 and 19,300 levels respectively. The market breadth on BSE was showing positive trend with advances to declines in ratio of 997: 631.

The BSE Sensex is currently trading at 19310.18, up by 130.82 points or 0.68% after trading in a range of 19338.78 and 19192.11. There were 24 stocks advancing against 6 declines on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.77% and Small cap index was up by 0.43%.

The top gaining sectoral indices on the BSE were, Oil & Gas up by 1.67%, Auto up by 1.56%, PSU up by 1.26%, Power up by 1.24% and Bankex up by 1.05% while, IT down by 1.37%, Teck down by 0.68% and Consumer Durables down by 0.40% were the losers on the BSE.

The top gainers on the Sensex were NTPC up by 3.15%, ONGC up by 2.74%, Tata Motors up by 2.70%, Dr Reddys Lab up by 2.29% and Gail India up by 2.06%

On the flip side, TCS was down by 1.94%, Wipro was down by 1.75%, Infosys was down by 1.37%, Hindustan Unilever was down by 0.78% and HDFC Bank was down by 0.20% were the top losers on the Sensex

Meanwhile, In order to prevent the misuses of foreign investors’ funds, the Reserve Bank of India has proposed that inflow of foreign funds to the Indian entity should be allowed only through escrow mechanism. According to the RBI's proposal, Indian investee companies would be required to open an escrow account with bank rather than directly remitting to the account of investee company and funds shall be released by bank from this account in accordance with the terms of escrow arrangement.

The issue was recently discussed at a high-level meeting headed by the Department of Economic Affairs (DEA) secretary Arvind Mayaram, which was also attended by DIPP Secretary Saurabh Chandra, Chief Economic Advisor Raghuram Rajan and RBI officials. The central bank argued that that the misuse can be checked if usage of money is allowed only after issuance of shares. In the meeting the proposal was accepted and was said that the RBI may flesh out the proposal and forward it with a draft notification for consideration and approval.

The foreign direct investment (FDI) in India declined by 19 percent in February, 2013 to $ 1.79 billion from the $ 2.15 billion recorded in the same month of previous year, owing to the prevailing global economic slowdown. Foreign investment is considered crucial for economic development of a country and the decline in foreign investments could put pressure on the country’s balance of payments and may also impact the value of the rupee.

The CNX Nifty is currently trading at 5,885.95 up by 49.05 points or 0.84% after trading in a range of 5,889.60 and 5,853.30. There were 41 stocks advancing against 8 declines while 1 stock remained unchanged on the index.

The top gainers of the Nifty were NTPC up by 2.99%, Cairn up by 2.77%, IndusInd Bank up by 2.74%, Axis Bank up by 2.70% and Tata Motors up by 2.56%.

On the flip side, TCS down by 1.72%, HCL Tech down by 1.60%, Infosys down by 1.41%, HUL down by 0.73% and Ranbaxy down by 0.57%, were the major losers on the index.

Most of the Asian equity indices were trading in Green; Shanghai Composite rose 3.79 points or 0.17% to 2,222.11, Hang Seng surged 237.60 points or 1.07% to 22,420.65, Nikkei 225 jumped 78.02 points or 0.56% to 13,921.48, Straits Times strengthened 8.58 points or 0.25% to 3,331.37, KOSPI Composite was up by 6.66points or 0.34% to 1,941.97 and KLSE Composite increased 0.63 points or 0.04% to 1,707.98.

On the flip side, Jakarta Composite declined 23.84 points or 0.48% to 4,987.77, and Taiwan Weighted was down by 23.54 points or 0.29% to 8,000.26.