Sensex, Nifty continue to trade in green

Benchmarks recovering from the early weakness have gathered momentum to trade higher in the late-morning session. The initial slide was triggered by weak industrial production data for June 2013 that was released by the government after trading hours on Monday, 12 August 2013. Gains in Asian stocks aided recovery, as all the Asian equity indices, barring Shanghai Composite were trading in the green terrain at this point of time, led by gains in Japanese markets which rose over one and a half percent after the yen weakened on report that Prime Minister Shinzo Abe is considering a corporate tax cut as a way to offset the impact of a planned two-stage increase in the sales tax. Back home, traders were buying Power, IT and Teck stocks, while selling was seen in Consumer Durables and Metal on the BSE. Pharma related stocks like, Biocon, Aurobindo Pharma, Cipla and Sun Pharma edged higher as the Finance Minister said that the government will soon finalise the foreign investment policy on brown field pharmaceutical projects. IT stocks rose as the rupee weakened against the dollar on Tuesday. Shares of Infosys, Wipro and tech Mahindra hit 52-week high.

 Meanwhile, the NSE Nifty and BSE Sensex were trading near the psychological 5,650 and 19,000 levels respectively. The market breadth on BSE was showing positive trend with advances to declines in the ratio of 998:556.The BSE Sensex is currently trading at 19090.51, up by 143.53 points or 0.76 % after trading in a range of 19100.48 and 18864.81. 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 0.66% and Small cap index gained 0.71%.

The top gaining sectoral indices on the BSE were, Power up by 1.74%, IT up by 1.74%, Teck up by 1.54%, Auto up by 1.39% and Health Care up by 1.30% while Consumer Durables down by 0.97% and Metal down by 0.36% were the top losers on the sectoral index.

The top gainers on the Sensex were Mahindra & Mahindra up by 3.32%, NTPC up by 2.93%, Wipro up by 2.65%, BHEL up by 2.21% and Cipla up by 2.10%.  On the flip side, Hindalco Industries down by 2.67%, Coal India down by 1.80%, ONGC down by 0.97%, Jindal Steel down by 0.82% and ICICI Bank down by 0.67% were the top losers on the Sensex.

Meanwhile, expressing his concern over the widening current account deficit (CAD), Finance Minister P. Chidambaram has said that the government would bring down CAD to 3.7 percent of the gross domestic product (GDP) in the current financial year by cutting imports, especially of gold, silver, oil and non-essential items. India’s CAD widened to a record high to $88.2 billion or 4.8 of GDP in the previous fiscal on account of high gold imports and crude oil prices.

Chidambaram said that finance ministry in consultation with the Reserve Bank of India (RBI) and other ministries including oil and commerce among others had outlined a plan to contain CAD at $70 billion in the FY14, which will amount to 3.7 percent of GDP. By adding further, Finance Minister said that the government is confident of fully financing the current account gap and has added $3.8 billion to the reserves. He added that the recent volatility in the currency markets was largely due to the growing concerns over the CAD, reflecting pressure on the domestic currency. Rupee value depreciated to a record low of 61.80 to the dollar on August 6.  

The government will also take measures to enhance capital inflows into the country that will help reduce the current account gap and help to stabilise the rupee. The possible steps to boost capital inflows into the country include bond issues by state-run companies and easier norms for overseas borrowings among others.

The CNX Nifty is currently trading at 5,653.80 up by 41.40 points or 0.74% after trading in a range of 5,653.95 and 5,578.90. There were 38 stocks advancing against 12 declines on the index.

The top gainers of the Nifty were DLF up by 4.94%, M&M up by 3.21%, Indusind BK up by 3.16%, Lupin up by 3.01% and NTPC up by 3.00%. On the flip side, Hindalco Industries down by 2.71%, Ambuja Cements down by 2.55%, Coal India down by 1.80%, ONGC down by 0.93% and ACC down by 0.89% were the major losers on the index.

Most of the Asian equity indices were trading in green; Hang Seng rose 209.34 points or 0.94% to 22,480.62, Jakarta Composite increased 19.15 points or 0.42% to 4,616.93, KLSE Composite strengthened 8.97 points or 0.50% to 1,793.54, Nikkei 225 surged 257.38 points or 1.90% to 13,776.81, Straits Times added 12.82 points or 0.42% to 3,245.78, Seoul Composite soared 19.62 points or 1.04% to 1,904.45 and Taiwan Weighted was up by 64.02 points or 0.81% to 7,967.40.

Shanghai Composite was down by 0.50 points or 0.02% to 2,100.78.