Benchmarks maintains upmove as rupee recovers

Benchmarks continued to trade range-bound with positive bias after a gap-up start as the rupee strengthened against the US dollar after the Reserve Bank of India opened forex swap window to meet daily dollar needs of oil marketing companies IOC, HPCL and BPCL. Under the swap facility, RBI will undertake sell/buy USD-INR forex swaps for fixed tenor with the oil marketing companies through a designated bank. The above move is applicable with immediate effect and will remain in place until further notice. The rupee appreciated sharply on the back of RBI move and rallied 3 per cent to touch Rs 66.90 per dollar in early trade. The partially convertible rupee was at 67.51, up 129 paise against its previous close. However, the international crude oil prices were near two-year high on concerns over a military strike led the US on Syria for alleged use of chemical weapons against Syrians. The Brent North Sea crude for October delivery was at $115.85 per barrel, down 76 cents, after touching six month high in previous trade. The market may turn volatile later in the session as traders will square off open positions on the settlement day of August series.

On the global front, Asian equity indices too were trading mostly higher at this point of time as market-men opted to buy battered down fundamentally strong stocks. Back home, traders were buying, Consumer Durables, Capital Goods and Metal while selling were seen in Realty, FMCG and Auto on the BSE. Meanwhile, the benchmarks NSE Nifty and BSE Sensex were trading near the psychological 5,300 and 18,100 levels respectively. The market breadth on BSE was showing positive trend with advances to declines in the ratio of 803: 623.The BSE Sensex currently trading at 18134.97, up by 138.82 points or 0.77% after trading in a range of 18205.49 and 18071.22. There were 20 stocks advancing against 9 declines on the index. The broader indices were trading in green; the BSE Mid cap index was up by 0.50% and Small cap index up by 0.63%.

The  top gaining sectoral indices on the BSE were, Consumer Durables up by 2.07%, Capital Goods up by 1.78%, Metal up by 0.85%, Oil & Gas up by 0.66% and Teck up by 0.59% and while Realty down by 0.59%, FMCG down by 0.10%, Auto down by 0.08% and PSU down by 0.04% were the top losers on the sectoral index.

The top gainers on the Sensex were HDFC up by 4.55%, Sesa Goa up by 4.22%, L&T up by 2.95%, HDFC Bank up by 2.37% and Hindalco Inds up by 2.20%. On the flip side, Coal India was down by 1.38%,  Bajaj Auto was down by 0.85%, Hero MotoCorp was down by 0.74% , SBI was down by 0.68%, and Sun Pharma was down by 0.58% were the top losers on the Sensex.

Meanwhile, In a move to contain the widening current account deficit (CAD) of the country, the oil ministry has worked out a plan to renew imports from sanctions-hit Iran, where India pays in rupees and will save $22 billion in the oil import bill. As per the current scenario, 10 million tonnes oil imports from Iran can save $10 billion in foreign exchange outgo. In the last fiscal, India had imported only 13.1 million tonnes of oil from Iran, which was 18.11 million tonnes of 2011-12.

In India, around 80 percent of the total crude oil demand is met through the imports, which has become one of the components responsible for high CAD. India's CAD rose to record high of $88.2 billion or 4.8 percent of the GDP in the previous fiscal.

Meanwhile, India did not import oil from Iran in first four months of the current fiscal as the US and western sanctions blocked all payment routes as India pays Iran in rupees. Presently, India is discussing with Iraq the possibility of trade in local currencies in the view of the current volatility of the rupee against the dollar. Further, the move would also help insulate India's oil imports from Iraq.

The CNX Nifty is currently trading at 5,316.80 up by 31.80 points or 0.60% after trading in a range of 5,348.85 and 5,303.00. There were 26 stocks advancing against 24 declines on the index.

The top gainers of the Nifty were HDFC up by 4.84%, Sesa Goa up by 4.46%, L&T up by 3.00%, Asian Paint up by 2.98% and Power Grid up by 2.40%, On the flip side, UltraTech Cement down by 2.58%,  Ambuja Cements down by 2.50%, PNB down by 2.42% ,JP Associate down by 2.22% and  Axis Bank down by 2.04% were the major losers on the index.

Most of the Asian equity indices were trading in green; Hang Seng rose 111.12 points or 0.52% to 21,635.77, Jakarta Composite increased 17.92 points or 0.44% to 4,044.39, KLSE Composite surged 17.47 points or 1.04% to 1,703.64, Nikkei 225 gained 97.73 points or 0.73% to 13,436.19, Straits Times strengthened 16.27 points or 0.54% to 3,020.45, Seoul Composite jumped 27.77 points or 1.47% to 1,912.29 and Taiwan Weighted was up by 95.18 points or 1.22% to 7,919.72.

On the flip side, Shanghai Composite was down by 3.63 points or 0.17% to 2,097.67.