Firm trade prevails at highest point of the day

Indian equity markets added gains to continue firm trade hovering near the highest point of the day in the late afternoon session on account of buying in front line counters and taking cues from European counterparts. The sentiments were on positive mood on expectation that government will announce major package, comprising of a combination of import compression, long-term external commercial borrowing and foreign capital flow management. Traders were seen piling position in Realty, Metal and Power stocks while selling was witnessed in Oil & Gas sector stocks. In scrip specific development, Ranbaxy Laboratories was trading firm after reporting better-than-expected April-June sales at its US unit. Bharti Airtel was trading in green after the top telecom operator stated that it will raise call rates on select Delhi post-paid plans on September 8. Sun Pharmaceuticals was trading in red after its subsidiary Taro Pharmaceutical saw its net income slip to $58.8 million in the first quarter.

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 5,550 and 18,800 levels respectively. The market breadth on BSE was positive in the ratio of 1241:833, while 124 scrips remain unchanged. 

The BSE Sensex is currently trading at 18800.24, up by 135.36 points or 0.73% after trading in a range of 18804.88 and 18621.67. There were 19 stocks advancing against 11 declines on the index.

The broader indices were trading in green; the BSE Mid cap and Small cap indices were trading higher by 1.13% and 1.21% respectively.

The top gaining sectoral indices on the BSE were, Realty up by 2.59%, Metal up by 2.38%, Power up by 1.25%, Auto up by 0.97% and TECK up by 0.92%. While, Oil and Gas down by 0.25% was the sole loser indices on the BSE.

The top gainers on the Sensex were Hindalco Industries up by 5.08%, Cipla up by 3.74%, Maruti Suzuki up by 3.46%, Bharti Airtel up by 3.09% and Tata Steel up by 2.96%. On the flip side, Wipro down by 2.36%, Sun Pharma down by 1.97%, SBI down by 1.90%, Dr. Reddy’s Lab down by 1.64% and Tata Motors down by 1.02% and were the top losers on the Sensex.

Meanwhile, the government has revised upward the textiles export target to $43 billion for the current fiscal, from $36 billion set earlier. Minister of State for Textiles Panabaaka Lakshmi said that following discussions with textiles export promotion councils against the backdrop of rupee depreciation and after considering strong industry performance, the government has decided to raise the textile exports target to $43 billion for FY14. In the previous fiscal, domestic textile exports stood at $34 billion.

Meanwhile, Indian textile exports' growth remained flat to $7.79 billion in the first quarter  of this fiscal from $7.76 billion in the same period of the 2012-13 mainly due to the weak demand in global markets like the US  and Europe. However, it seems difficult for the government to achieve set exports target on account of prevailing slowdown in major markets include the US and Europe, which represents around 65 percent share in the country's total textiles exports. Exporters are now exploring new markets like Latin America, Africa, Australia, Japan, Israel, South East Asia and Middle East countries to reduce dependence on western markets.

The government has taken various steps to boost textiles exports including providing three percent interest subvention, incremental export incentive scheme and inclusion of new markets like New Zealand, Latvia for textile exports under the focus market scheme. The government had earlier said that textiles sector is the only sector where we can increase the exports substantially, adding that industry issues will be addressed soon. The government had also expressed need to encourage skill development as adequate skill development will boost the production and turn down the cost of production, leading the textile sector to grow which in turn will help it to compete in the global market.

The CNX Nifty is currently trading at 5,561.20, up by 42.10 points or 0.76% after trading in a range of 5,567.45 and 5,510.05. There were 35 stocks advancing against 14 declines while 1 stock remained unchanged on the index.

The top gainers of the Nifty were Ranbaxy Laboratories up by 13.37%, Hindalco Industries up by 5.55%, DLF up by 5.30%, Cipla up by 4.01% and Maruti Suzuki up by 3.77%. On the flip side, Lupin down by 2.49%, SBI down by 2.15%, Sun Pharma down by 1.72%, Dr. Reddy’s Lab down by 1.71% and Reliance Industries down by 1.05% were the major losers on the index.

The Asian equity indices were mostly trading in red; Shanghai Composite lost 0.09%, Nikkei 225 dropped 1.59% and Taiwan Weighted edged lower 0.17% while Hang Seng increased 0.31% and Seoul Composite strengthened 0.30%. Markets in Indonesia, Malaysia and Singapore remained shut for the trade today.

The European markets were trading in green; France’s CAC 40 was up 0.16%, Germany’s DAX added 0.09% and the United Kingdom’s FTSE 100 edged higher 0.15%.