Banking and Realty shares lift markets higher

After making a gap-up start, Key benchmarks are extending their gains in late morning session tailing sharp rally in the Asian markets. All the sectoral indices were in the green with banks, realty and metals leading the upmove. Sentiments got some support from a firm trend in other Asian bourses after weak US data raised the likelihood that the Federal Reserve would keep its stimulus programme in place for some time. The market is likely to continue its upward momentum following pick-up in banks in the near term. However, the Reserve Bank of India's first-quarter review of the monetary policy on July 30 will be key trigger for the market in either direction. On the global front, 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, the traders were seen piling up positions in Banking, Realty and Consumer Durables. In sector specific developments, jewelers and the gold related stocks like Tribhovandas Bhimji Zaveri, Rajesh Exports and Titan Industries are trading lower as the RBI imposed further restrictions on gold imports by banks and other authorised agencies.

Meanwhile, the NSE Nifty and BSE Sensex were trading near the psychological 6,050 and 20,000 levels respectively. The market breadth on BSE was showing positive trend with advances to declines in the ratio of 904:583. The BSE Sensex is currently trading at 20342.29, up by 183.17 points or 0.91% after trading in a range of 20344.47 and 20249.98. There were 27 stocks advancing against 3 declines on the index. The broader indices were trading in green; the BSE Mid cap index was up by 0.58% and Small cap index gained 0.35%.

The top gaining sectoral indices on the BSE were, Bankex up by 1.67%, Realty up by 1.51%, Consumer Durables up by 1.51%, Metal up by 1.34% and Oil & Gas up by 1.34%, while there was no loser on the BSE.

The top gainers on the Sensex were BHEL up by 2.20%, Sterlite Industries up by 1.99%, Dr Reddys Lab up by 1.84%, Tata Steel up by 1.73% and SBI up by 1.69%.  On the flip side, Sun Pharma was down by 0.58%, Bharti Airtel was down by 0.40%, Tata Motors was down by 0.39%  and HDFC was down by 0.14% were the top losers on the Sensex.

Meanwhile, in a move that could shore up foreign exchange inflows in the country at a time when it is needed the most, the Reserve Bank, in consultation with the Government of India, has reduced the period of realisation and repatriation for exporters of goods and software to 9 months from earlier 12 months.

However, contrary to its latest decision RBI in last November had increased the time limit to bring in export earnings to 12 months from 6 months, in view of global slowdown. But due to country’s worsening Current Account Deficit (CAD) and the weakening rupee, the central bank has now shortened the timeframe to bring in the money. Though, provisions in regard to period of realization and repatriation to India of the full export value of goods or software exported by a unit situated in a Special Economic Zone (SEZ) as well as exports made to warehouses established outside India remains unchanged.

Declining exports and depreciating rupee against the dollar has put pressure on CAD. While, India's exports contracted by 4.6%, for the second consecutive month, to $ 23.79 billion in June 2013 compared to that in the year-ago period, Indian rupee too has depreciated by over 12 percent against the dollar since the beginning of the fiscal, hitting a lifetime low of Rs 61.21 a dollar, forcing the central bank and capital markets regulator SEBI to take unconventional measures to arrest the slid.

The CNX Nifty is currently trading at 6,087.40 up by 55.60 points or 0.92% after trading in a range of 6,087.80 and 6,061.30. There were 42 stocks advancing against 7 declines, while 1 stock remained unchanged on the index.

The top gainers of the Nifty were Bank of Baroda up by 3.28%, Kotak Mahindra Bank up by 3.11%, PNB up by 2.77% , BPCL up by 2.73% and Indusind Bank  up by 2.52%, and On the flip side, Asian Paints down by 1.23%, Sun Pharma down by 0.63%, Bharti Airtel down by 0.62%, Tata Motors down by 0.42% and Ambuja Cement  down by 0.28% 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 470.49  points or 2.20% to 21,886.99, 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 77.86 points or 0.96% to 8,183.31.