Benchmarks trade higher on positive global set-up

Buoyed by firm global cues, Indian equity indices have made a gap-up opening and are trading jubilantly in morning deals with frontline indices surpassing their crucial 6,050 (Nifty) and 20,300 (Sensex) bastions. The US markets, though modestly but ended higher overnight on the back of some positive earnings report, however on economy front the news was not good, as sales of previously-owned homes fell 1.2 percent in June, while all the Asian equity indices were trading in the green at this point of time with Chinese and Hong Kong benchmarks leading the pack with a gain of over two percent, following Friday’s decision by the People’s Bank of China to remove the floor on the discount Chinese banks can offer for commercial lending rates.

Back home, markets also got some support with Prime Minister’s Economic Advisory Council (PMEAC) Chairman C Rangarajan’s statement that the Indian economy will grow by 6 percent this fiscal on account of a good monsoon. Bucking the trend, jewelers and the gold related stocks like Tribhovandas Bhimji Zaveri, Rajesh Exports and Titan Industries are trading lower in the early deals as the RBI imposed further restrictions on gold imports by banks and other authorised agencies.

On the sectoral front, realty witnessed the maximum gain in trade followed by banking and oil and gas, while consumer durables remained the lone losers on the BSE sectoral space. The broader indices were going neck-to-neck with benchmarks, while the market breadth on the BSE was positive; there were 734 shares on the gaining side against 402 shares on the losing side while 63 shares remain unchanged.

The BSE Sensex opened at 20249.98; about 90 points higher compared to its previous closing of 20159.12, and has touched a high and a low of 20340.96 and 20249.98 respectively.

The index is currently trading at 20316.46, up by 157.34 points or 0.78%. There were 25 stocks advancing against 5 declines and one stock remained unchanged on the index.

The overall market breadth has made a strong start with 61.22% stocks advancing against 33.53% declines. The broader indices were trading in green; the BSE Mid cap up by 0.57% and Small cap indices up by 0.31%. 

The top gaining sectoral indices on the BSE were, Realty up by 1.37%, Bankex up by 1.24%, Oil & Gas up by 1.17%, PSU up by 1.13% and IT up by 1.01%, while Consumer Durables down by 0.06% was the only loser on the sectoral index.

The top gainers on the Sensex were BHEL up by 2.48%, ONGC up by 1.71%, Dr Reddys Lab up by 1.70%, Sterlite Industries up by 1.44% and SBI up by 1.25%.  On the flip side, HDFC was down by 0.47%,  Bharti Airtel was down by 0.45%, Sun Pharma was down by 0.14%, Hindalco Industries was down by 0.10% and Hero MotoCorp was down by 0.03% were the top losers on the Sensex.

Meanwhile, on the grounds of potential threat to country’s security, the Home Ministry has strongly opposed any move to increase the FDI cap in the broadcasting and print media. Apprehending 'undue' influence by big global players, the Home Ministry strongly favours control of media houses by Indians, and is of the view that opening up of current affairs TV channels, newspapers and periodicals dealing with news and current affairs may lead to meddling in India’s domestic affairs and politics.

The Ministry also fears that increase of FDI in broadcasting and print media may also allow foreign players to launch propaganda campaign during any national crisis as well as when interests of any particular country is harmed through any government decision.

Further, it feels that big foreign media players with vested interests may try to fuel fire during internal or external disturbances and also can encourage political instability in the country through their publications or broadcasting outlets.

It was basically after Home Ministry's strong objections that a high-level meeting chaired by Prime Minister Manmohan Singh, on July 16, did not clear the Commerce Ministry's proposal for increasing FDI in broadcasting and print media to 49% through automatic route. Currently, the sectoral cap for FDI in FM radio, uplinking news and current affairs TV channels and in print media is 26 per cent and the Commerce Ministry has proposed to raise it to 49 per cent through the automatic route.

The CNX Nifty opened at 6,064.30; about 32 points higher as compared to its previous closing of 6,031.80, and has touched a high and a low of 6,084.00 and 6,061.30 respectively.

The index is currently trading at 6,079.50, up by 47.70 points or 0.79%. There were 43 stocks advancing against 7 declines on the index.

The top gainers of the Nifty were Kotak Mahindra Bank up by 2.78%, Bank of Baroda up by 2.68%, BHEL up by 2.54%, PNB up by 2.35% and BPCL up by 2.28%. On the flip side, Asian Paints down by 1.43%, HDFC down by 0.63%, Bharti Airtel down by 0.52%, Hindalco Industries down by 0.24% and Hero MotoCorp down by 0.16% were the major losers on the index.

The Asian equity indices were trading in green; Shanghai Composite soared 43.43 points or 2.17% to 2,048.19, Hang Seng surged 438.24 points or 2.05% to 21,854.74, Jakarta Composite jumped 63.21 points or 1.35% to 4,742.19, KLSE Composite rose 5.71 points or 0.32% to 1,803.39, Nikkei 225 increased 119.09 points or 0.81% to 14,777.13, Straits Times added 10.53 points or 0.33% to 3,244.88, Seoul Composite strengthened 21.17 points or 1.13% to 1,901.52 and Taiwan Weighted was up by 100.53 points or 1.24% to 8,205.98.