Indian benchmarks trade higher on firm global cues; banking stocks spur

Extending their previous sessions’ rally, Indian equity indices are trading in the positive terrain supported by firm global cues. the US markets, overnight, continued its up-move, though there was some volatility on mixed batch of US economic data after Federal Reserve reported a bigger than expected drop in industrial production in April. Asian equity indices too were trading mostly higher at this point of time after data showed Japan’s economy accelerated in the first three months of the year, in contrast to an enduring recession in the euro zone which was keeping the euro in the doldrums. Japanese economy grew 0.9% in the first quarter, speeding up from a 0.3% pace in the previous quarter and beating expectations for a growth rate of 0.7%.

Back home, some support came in from rally in banking stocks, which extended their gains on hopes of rate cut by the central bank. Sentiments also remained up-beat after Moody’s statement that Indian economy is expected to pick up and grow in the range of 5.5-6.5 percent in 2013. There is some good news for the foreign investors too, as the newly appointed Law Minister Kapil Sibal cleared a SEBI regulation which permits put and call options in mergers and acquisitions. However, the gains remain capped as Moody’s noted that the Current Account Deficit (CAD) remains a persistent concern for India.

On the sectoral front, healthcare witnessed the maximum gain in trade followed by banking and capital goods while, software, technology and fast moving consumer goods remained the top losers on the BSE sectoral space. The broader indices were outperforming benchmarks while, the market breadth on the BSE was positive; there were 1,000 shares on the gaining side against 464 shares on the losing side while 52 shares remain unchanged.

The BSE Sensex opened at 20,167.93; about 45 points lower compared to its previous closing of 20,212.96, and has touched a high and a low of 20,326.48 and 20,162.12 respectively.

The index is currently trading at 20,282.53, up by 69.57 points or 0.34%. There were 20 stocks advancing against 10 declines on the index.

The overall market breadth has made a strong start with 64.65% stocks advancing against 31.93% declines. The broader indices were trading in green; the BSE Mid cap and Small cap indices up by 0.90% and 0.68% respectively. 

The top gaining sectoral indices on the BSE were, Health Care up by 1.57%, Bankex up by 1.23%, Capital Goods up by 1.01%, Power up by 0.78% and Oil & Gas up by 0.76% while, IT down by 0.57%, Teck down by 0.40%, FMCG down by 0.36% and Auto down by 0.31% were the only losers on the sectoral index.

The top gainers on the Sensex were Dr Reddys Lab up by 3.02%, ICICI Bank up by 1.93%, SBI up by 1.48%, Cipla up by 1.12% and RIL up by 1.12%.

On the flip side, Tata Motors was down by 1.22%, TCS was down by 0.97%, Maruti Suzuki was down by 0.81%,  Infosys was down by 0.70% and  Wipro was down by 0.61% were the top losers on the Sensex.

Meanwhile, accelerating industrial production, improvement in global conditions and likelihood of good monsoon, could turnaround the sagging economy this fiscal.  The government hopes of registering GDP growth rate ranging between 6.1-6.7 percent in 2013-14. According to Planning Commission Deputy Chairman Montek Singh Ahluwalia, ‘India has had not a good year, which was better year for many other countries, however hoping to have much better year (2013-14).’

The Central Statistical Organization has pegged Indian economic growth at 5 percent in 2012-13 in its advance states. Meanwhile, the inflation measured in terms of Wholesale Price Index (WPI) fell to 3.5-year low of 4.89 percent in April compared to 5.96 percent in March this year and 7.50 percent in April, 2012. The retail inflation, as measured by consumer price index, also came down to single digit at 9.39 percent in April after many months, indicating that inflationary expectation is on declining trend.

The CNX Nifty opened at 6,128.25; about 18 points lower as compared to its previous closing of 6,146.75, and has touched a high and a low of 6,187.30 and 6,128.25 respectively.

The index is currently trading at 6,175.35, up by 28.60 points or 0.47%. There were 38 stocks advancing against 12 declines on the index.

The top gainers of the Nifty were Dr. Reddy's Laboratories up by 3.03%, JP Associates up by 2.70%, Reliance Infrastructure up by 2.26%, ICICI Bank up by 2.10% and IDFC up by 1.93%.

On the flip side, TCS down by 1.26%, Tata Motors down by 1.07%, NMDC down by 0.86%, Maruti Suzuki down by 0.83% and Infosys down by 0.76%, were the major losers on the index.

Most of the Asian equity indices were trading in green; Shanghai Composite rose 21.77 points or 0.98% to 2,246.57, Hang Seng increased 82.80 points or 0.36% to 23,127.04, Jakarta Composite jumped 15.36 points or 0.30% to 5,105.24, KOSPI Composite added 18.09 points or 0.92% to 1,989.35 and Taiwan Weighted was up by 83.35 points or 1.00% to 8,401.94.

On the flip side, KLSE Composite declined 11.69 points or 0.66% to 1,771.34, Nikkei 225 tumbled 194.25 points or 1.29% to 14,901.78 and Straits Times was down by 1.64 points or 0.05% to 3,439.89.