Benchmarks trade at intra-day highs

Indian equity markets extended their gains in the late morning session on Monday and reached at intra-day high levels as investors’ sentiments got a boost after knowing that finance ministry is set to unveil a slew of measures to boost capital flows, which will help stabilise the rupee. The new measures being considered by the finance ministry are in addition to steps taken recently by the Reserve Bank of India (RBI) to tighten liquidity and curb volatility in the rupee, which had depreciated to a record low of 61.80 to the dollar on August 6. The RBI on Friday announced that it will sell government bonds worth Rs 22,000 crore every Monday to check rupee depreciation. Further, the government move to give incentives to the auto component industry to boost industry exports and its approval for setting up of 12 mega food parks during the 12th Five Year Plan period (2012-17) also boosted the investors’ sentiments. On stock specific, Tata steel, Sun pharma and Jindal Steel were trading over 5 percent higher. On the global front, most of Asian shares were trading in green as investors sentiments got a boost from last week's encouraging data from the world's second-biggest economy China, helping offset a slightly disappointing second quarter Japanese GDP report. Back home, the market breadth was favoring the positive trend; there were 1237 shares on the gaining side against 719 shares on the losing side, while 100 shares remained unchanged.          

The BSE Sensex is currently trading at 18,938.49 up by 149.15 points or 0.79% after trading in a range of 18,951.99 and 18,796.01. There were 22 stocks advancing against 8 declines on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.03%, while Small cap index up by 1.28%.

The top gaining sectoral indices on the BSE were, Metal up by 4.17%, Healthcare up by 2.01%, FMCG up by 1.44% and Auto up by 1.21%. While, Bankex down by 0.88% was the only loser indice on the BSE.

The top gainers on the Sensex were Tata Steel up by 6.66%, Sun Pharma up by 6.57%, Jindal Steel up by 5.28%, Sterlite Inds up by 4.85% and Hero Moto Corp up by 2.67%. On the flip side, SBI down by 2.53%, Tata Power down by 1.87%, Dr. Reddys Lab down by 1.54%, HDFC Bank down by 1.43% and TCS down by 1.29% were the top losers on the Sensex.

Meanwhile, in order to boost the auto components exports, the government is considering giving incentives to the auto component industry as the sector, especially exports, has been facing a tough time. The Ministry of Commerce and the Department of Heavy Industry (DHI) are doing an assessment of the sector and once the assessment is completed, both the ministries will see if incentives could be given to the sector.

Presently, the sector has been hurt by the slump in automobile demand, in both the domestic and export markets. The overall domestic sales during April-June 2013 quarter declined by 2.10 percent over the same period last year. On the other hand, overall automobile exports declined by 5.65 percent during April-June 2013.

Concerned over the declining demand in the sector, the Automotive Component Manufacturers’ Association of India (ACMA) has approached the Department of Heavy Industry to take steps to support the auto component industry and to address issues such as the high borrowing cost and exports incentives in the wake of rupee depreciation. Meanwhile, the country’s auto component export is expected to remain sluggish in the near term on account of weak global demand.

The CNX Nifty is currently trading at 5,598.50 up by 32.85 points or 0.59% after trading in a range of 5,610.65 and 5,557.10. There were 31 stocks advancing against 19 declines on the index.

The top gainers of the Nifty were Sun Pharma up by 7.05%, Tata Steel up by 6.56%, NMDC up by 5.15%, Jindal Steel up by 5.11% and Sesa Goa up by 4.03%. On the flip side, SBI down by 2.65%, Indusin Bank down by 2.31%, Grasim down by 2.04%, PNB Bank down by 1.95% and Axis bank down by 1.94% were the major losers on the index.

The most of Asian equity indices were trading in green; Hang Seng up by 2.07%, Seoul Composite up by 4.12 points or 0.22% and reached 1884.83, Straits Times up by 0.23%, Shanghai Composite up by 1.78%, Taiwan Weighted up by 0.60% and KLSE Composite up by 0.33%.

While, Jakarta Composite down by 0.66% and Nikkei 225 was down by 0.70%.