Firm trade prevails; Nifty above 5,650 mark

Indian equity markets added gains to continue their firm trade in the late afternoon session on account of buying in frontline blue chip counters and taking cues from European counterparts. Traders were seen piling positions in Oil & Gas, Realty and Capital Goods stocks while selling was witnessed in Consumer Durables, Health Care and Power sector stocks. In scrip specific development, Ranbaxy Laboratories was trading firm after Supreme Court dismissed a PIL against the company for manufacturing and distributing of adulterated drugs. Nevyeli Lignite Corporation (NLC) was trading under pressure as employees of state-run firm will go on an indefinite strike from July against the government’s decision to divest around 5% stake in the company. Kingfisher Airlines (KFA) was trading in red on reports that the banks have started the process to recover outstanding debt of the company. The process of identifying Vijay Mallya’s properties has begun days ahead of the expiry of the Sarfesi notice.

On the global front, most of the Asian markets were trading in red while the European markets were trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 5,650 and 18,700 levels respectively. The market breadth on BSE was negative in the ratio of 914:1179, while 130 scrips remain unchanged. 

The BSE Sensex is currently trading at 18775.88, up by 234.99 points or 1.27% after trading in a range of 18800.94 and 18487.30. There were 22 stocks advancing against 7 declines while 1 stock remained unchanged on the index. The broader indices were trading in red; the BSE Mid cap and Small cap indexes were trading lower by 0.19% and 0.28% respectively.

The top gaining sectoral indices on the BSE were, Oil & Gas up 2.82%, Realty up 1.91%, Capital Goods up by 1.23%, Bankex up 1.13% and PSU up 0.99%, while Consumer Durables down by 0.73% was the only losers on the BSE.

The top gainers on the Sensex were ONGC up by 4.57%, Bharti Airtel up by 4.22%, Hindalco Industries up by 3.61%, Reliance Industries up by 3.03% and HDFC Bank up by 2.88%. On the flip side, Wipro down by 1.00%, ICICI bank down by 0.77%, Maruti Suzuki down by 0.59%, Tata Motors down by 0.55% and SBI down by 0.38% were the top losers on the Sensex.

Meanwhile, the government is expected to clarify the policy on foreign direct investments (FDI) in the pharmaceuticals sector soon. The issue, which has been haunting the pharma sector for a long time is expected to be resolved soon as the department of industrial policy and promotion (DIPP), along with the health ministry and department of pharmaceuticals likely to meet on July 10 to clarify the matter. Further, the Foreign Investment Promotion Board (FIPB) is also scheduled to take up 10 investment proposals for the sector during its forthcoming meeting on July 5.   

Last year the government had made a distinction between greenfield and brownfield projects ones following fears that Indians will be denied cheap medicines if multinational continued to buy big companies. However, in May, DIPP, the nodal ministry for the foreign direct investment (FDI) policy, asked FIPB not to clear any of the pharma sector proposals on concerns over ownership and production of essential medicines. Now, the government has decided to introduce safeguards to ensure that MNCs acquiring domestic firms will not stop producing essential drugs.

Presently, India permits 100 per cent FDI in pharmaceutical sector through automatic approval route in the new projects but the foreign investment in the existing pharmaceutical companies are allowed only through FIPB's approval. There are too many pharma proposals pending with the FIPB as several global pharma companies are looking to buy stake in Indian firms.

The CNX Nifty is currently trading at 5,658.20, up by 67.95 points or 1.22% after trading in a range of 5,665.40 and 5,570.25. There were 37 stocks advancing against 13 declines on the index.

The top gainers of the Nifty were IndusInd Bank up by 5.22%, ONGC up by 4.75%, Bharti Airtel up by 4.16%, Reliance Infrastructure up by 4.12% and Hindalco Industries up by 3.99%. On the flip side, NMDC down by 2.67%, Cairn India down by 2.38%, Lupin down by 2.16%, ICICI Bank down by 0.68% and Tata Motors down by 0.63% were the major losers on the index.

Most of the Asian equity indices are trading in red; Shanghai Composite lost 0.19%, Nikkei 225 declined 0.72%, KOSPI Composite Index plunged 1.02%, KLSE Composite dropped 0.36%, and Taiwan Weighted plummeted 1.22%. 

On the flip side, Hang Seng up by 0.21%, Jakarta Composite added 0.53% and Straits Times ascended 0.50% were the gainers amongst Asian pack.

The European markets were trading in green; France’s CAC 40 was up 1.40%, Germany’s DAX added 1.45% and the United Kingdom’s FTSE 100 edged higher by 0.84%.