Benchmarks come off day highs; Nifty holds on 5850

Key benchmarks after opening on a positive note with a percent higher have come off slightly, while trading in a small range, taking cues from the Asian peers. All the sectoral indices were in the green as Banks, Power and Realty lead the upmove. The Indian rupee opened stronger on Tuesday while bond yields dropped, following measures by the Reserve Bank of India and the market regulator to curb speculative trading in foreign exchange derivatives. The rupee appreciated by 46 paise at 60.14 against the dollar in early trade at the Interbank Foreign Exchange market on increased selling of the US currency by banks amid hopes that the Reserve Bank will take more steps to stem the fall .The market is likely to remain rangebound in the near term and take cues from rupee movement and quarterly results for direction. Sentiments got support on fresh buying by funds and retail investors, tracking a firming trend on other Asian bourses, following overnight gains in the US markets, supported the trading sentiment here. Besides, recovery in the rupee to 60.13 against the dollar also triggered buying activity. On the global front, buying in other Asian pacific markets too boosted the sentiments. However, gains in the regional counterparts remained capped as investors were nervous over Beijing’s new drive to reform credit to restructure the economy.

Back home, the traders were seen piling up positions in Bankex, Power and Realty. In scrip specific developments, shares of aluminium makers like Hindalco Industries and National Aluminium Company (Nalco) edged higher after Alcoa Inc, the largest US aluminum producer, reported better than expected Q2 results.In scrip specific actions, Punj Lloyd soared after the infrastructure major will construct a residential complex for the Delhi Police at an estimated cost of Rs 1,300 crore at Dheerpur in the National Capital. Alstom T&D India surged after the company said that it has bagged an order worth Rs 200 crore from Bajaj Infrastructure Development Company for supply of equipment to its 1,980 MW power plant in Uttar Pradesh. Hindustan Copper rose after the Life Insurance Corporation (LIC) picked up a 2.74 per cent stake in Hindustan Copper (HCL) during the company's offer-for-sale (OFS) on July 3. ABB India trades higher after the power equipment manufacturing company said it has bagged a contract from a Dutch firm Fastned, which builds electric vehicle charging stations, to supply over 200 electric chargers.

Meanwhile, the NSE Nifty and BSE Sensex were trying to hold the psychological 5,850 and 19,400 levels respectively. The market breadth on BSE was showing positive trend with advances to declines in ratio of 1127: 506. The BSE Sensex is currently trading at 19448.99, up by 124.22 points or 0.64% after trading in a range of 19486.00 and 19399.37. There were 21 stocks advancing against 9 declines on the index. The broader indices were trading in green; the BSE Mid cap index was up by 0.73% and Small cap index was up by 0.85%.

The top gaining sectoral indices on the BSE were, Bankex up by 1.19%, Power up by 1.07%, Realty up by 1.07%, Consumer Durables up by 0.99% and Health Care up by 0.89%, and while there were no losers on the BSE.

The top gainers on the Sensex were Bajaj Auto up by 2.76%, Sun Pharma up by 2.24%, BHEL up by 1.83%, HDFC Bank up by 1.80% and L&T up by 1.44%. On the flip side, Maruti Suzuki was down by 1.27%, Hindustan Unilever was down by 0.82%, Tata Motors was down by 0.62%, Bharti Airtel was down by 0.48% and ONGC was down by 0.34% were the top losers on the Sensex.

Meanwhile, as per the Paris-based think tank Organisation for Economic Cooperation and Development (OECD), though India’s growth remains relatively weak but the country’s economy is seeing signs of recovery, helped by gradual reduction of inflationary pressure. The economic outlook based on Composite Leading Indicators (CLI) is designed to anticipate turning points in economic activities.

OECD in its report stated that India’s CLI marginally rose to 97.6 in May from 97.3 in April, March and February, which points to a tentative upward change in momentum. The indicator however stood better at 97.7 in January. The report highlighted that the growth momentum in the two largest economies -India and China- is weaker than other ASEAN economies. Earlier, in May, OECD had revised lower Indian economic growth to 5.3 percent for 2013 from 5.9 percent projected earlier and had cautioned that structural bottlenecks could further constrain investment and growth potential. 

The OECD further said that its index of leading indicators pointed to moderate improvements in growth in most major OECD economies but in large emerging economies the composite leading indicators point towards stabilizing or slowing momentum. According to it, in most of the developed countries, growth prospects are expected to witness moderate improvements. CLIs for the United States and Japan continue to point to firm economic growth, while the CLIs for the United Kingdom, Canada and China point to growth close to trend rates. In the euro region, CLI continues to indicate a gain in growth momentum, while, indicators for Russia and Brazil, however, point to slowing momentum. 

The CNX Nifty is currently trading at 5,855.90 up by 44.35 points or 0.76% after trading in a range of 5,864.95 and 5,834.60. There were 41 stocks advancing against 9 declines on the index.

The top gainers of the Nifty were IndusInd Bank up by 2.66%, Bajaj Auto by 2.55%, Sun Pharmaceuticals up by 2.24%, Bank Baroda up by 2.23% and HDFC Bank up by 1.82%. On the flip side, Maruti Suzuki down by 1.33%, HUL down by 0.84%, ACC down by 0.76%, Bharti Airtel down by 0.60% and Tata Motors down by 0.54% were the major losers on the index.

Most of the Asian equity indices were trading in green; Shanghai Composite rose 5.00 points or 0.26% to 1,963.27, Hang Seng increased 104.28 points or 0.51% to 20,686.47, KLSE Composite jumped 4.65 points or 0.26% to 1,767.52, Nikkei 225 surged 324.69 points or 2.30% to 14,434.03, Straits Times gained 22.78 points or 0.72% to 3,178.20, KOSPI Composite added 13.08 points or 0.73% to 1,830.06 and Taiwan Weighted was up by 76.47 points or 0.97% to 7,962.81.

On the flip side, Jakarta Composite was down by 22.57 points or 0.51% to 4,411.05.