Firm trade persist; Nifty above 6,200 mark

Indian equity markets added minor gains while continuing firm trade in the late afternoon session on account of buying in front line blue chip counters and taking cues from positive opening of European counterparts. The sentiments on the street were on optimistic note as foreign investors’ continued buying in the local market. Overseas investors have poured in nearly Rs 12,000 crore (about $2.2 billion) into the Indian equity market so far this month. The sentiment also got support after economic affairs secretary Arvind Mayaram stated that there is no case for downgrading India’s sovereign credit rating, after Standard & Poor's reiterated its negative outlook on the country’s credit rating. Traders were seen piling position in Auto, Metal and Realty stocks while selling was witnessed in Consumer Durables, Health Care and Bankex sector stocks. The Auto stock Mahindra & Mahindra, Tata Motors, Maruti Suzuki India, Ashok Leyland, Bajaj Auto, Eicher Motors, TVS Motor Company and Hero MotoCorp were trading firm on hopes of rate cut. In the scrip specific development, Jubilant Foodworks was trading in green after foreign brokerage house CITI rated the stock a buy with an upward target. Lupin was trading in red after its rival Mylan launched the generic version of the cholesterol-lowering Tricor tablets (Finofibrate) which will lead to likely decline in market share of the company.

On the global front, the Asian markets were trading in green barring KOSPI Composite while the European markets were too trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,200 and 20,300 levels respectively. The market breadth on BSE was positive in the ratio of 1182:1074, while 126 scrips remain unchanged.

The BSE Sensex is currently trading at 20,368.39, up by 82.27 points or 0.41% after trading in a range of 20,443.62 and 20,277.76. There were 23 stocks advancing against 7 declines on the index.

The broader indices too pared some gains; the BSE Mid cap and Small cap index was trading up by 0.28% and 0.18% respectively.

The top gaining sectoral indices on the BSE were, Auto up by 1.82%, Metal up by 0.94%, Realty up by 0.71%, IT up by 0.54% and TECK up by 0.38%, while Consumer Durables down 0.93% and Health Care down by 0.77% were the losers on the BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 2.47%, Maruti Suzuki up by 2.40%, Tata Steel up by 2.23%, Bajaj Auto up 2.05% and Tata Motors up by 1.94%. On the flip side, Wipro was down by 2.56%, ONGC was down by 1.31%, Bharti Airtel down by 1.30%, Cipla was down by 1.08% and Dr. Reddy’s Lab down by 0.76% were the top losers on the Sensex.

Meanwhile, following the Cobrapost expose that alleged money laundering by banks, the Reserve Bank of India (RBI) has proposed a review of all banking licences from the ‘fit and proper’ angle, which involves assessment of the promoters, management, CEOs, even for the existing banks. 

The issues raised by the Cobrapost sting operation include inter-connectedness among entities forming part of a banking conglomerate, with insurance, mutual funds and brokerage arms in its ambit. The central bank noted that the review is necessary to ensure that an arm’s length is maintained from these various operations, to avoid a systemic risk. However, by adding further it said, this is a judgmental call and the decision needs to be taken after due deliberations.

Moreover, the RBI also suggested for taking up the issue at the Financial Stability and Development Council (FSDC) or its sub-committee, so that it can be approached in a holistic manner, after getting feedback from other regulatory agencies.  Meanwhile, the RBI has completed the investigation into the working of banks and has revealed various discrepancies in banking operations, including non-compliance of KYC norms and fictitious PAN cards.

The CNX Nifty is currently trading at 6,204.65, up by 17.35 points or 0.28% after trading in a range of 6,229.45 and 6,194.00. There were 31 stocks advancing against 19 declines on the index.

The top gainers of the Nifty were Tata Steel up by 2.42%, Maruti Suzuki up by 2.38%, Bajaj Auto up by 2.25%, M&M up by 2.25% and Reliance Infrastructure up by 1.90%. On the flip side, Ranbaxy Laboratories down by 5.15%, Lupin down by 4.65%, BPCL down by 1.98%, ONGC down by 1.56% and Cipla down by 1.42% were the major losers on the index.

Most of the Asian equity indices were trading in green; Shanghai Composite rose 0.75%, Hang Seng surged 1.78%, Jakarta Composite jumped 1.65%, KLSE Composite increased 0.51%, Nikkei 225 was up by 1.47%, Straits Times up by 0.60% and Taiwan Weighted was up by 0.11%.

On the flip side, KOSPI Composite down by 0.22% was the sole loser amongst the Asian pack.

The European markets were trading in green; France’s CAC 40 was up 0.20%, Germany’s DAX added 0.50% and United Kingdom’s FTSE 100 inched higher 0.71%.