Markets continue firm trade in afternoon session

Indian equity benchmarks extended gains and reached at their intra-day high level in afternoon session on the back of buying witnessed in banking, auto and capital goods stocks following positive trend in other Asian markets. The gain in rupee value against the dollar also added to the optimistic sentiments. The domestic currency rose to a two-week high as receding geopolitical risks from Syria and strong exports in August helped lift the currency. Buying was also witnessed in FMCG, infra and realty stocks. On stock specific movement, Tata Motors, HDFC and L&T were trading over 6 percent higher on BSE. Further, telecom stocks also witnessed buying as Telecom Regulatory Authority of India (TRAI) recommended up to 60% cut in minimum auction prices for mobile phone spectrum on account of lukewarm interest from telecom companies in two previous sales. The market breadth remained positive. Out of 1,923 stocks traded, 1287 stocks advanced while 534 stocks declined on the BSE. On global front, Asian stocks were trading at three-month higher as global investors remained optimistic that upcoming Chinese data will add to the global economic growth recovery, while receding fears of a U.S. military strike against Syria eased oil prices.

The BSE Sensex is currently trading at 19,807.30 up by 537.24 points or 2.79% after trading in a range of 19,826.36 and 19,444.66. There were only 29 stocks advancing against only 1 decline on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.30%, while Small cap index also up by 1.21%.

The top gaining sectoral indices on the BSE were, Auto up by 4.60%, Capital Goods up by 4.52%, FMCG up by 2.95% and Realty up by 2.60%.

The top gainers on the Sensex were, Tata Motors up by 8.34%, HDFC up by 6.58%, L&T up by 6.16%, Bharti Airtel up by 4.42% and Maruti Suzuki up by 4.13%. On the flip side, Dr. Reddy’s Lab down by 0.52% were the only losers on the Sensex.

Meanwhile, as per the Paris-based think-tank Organisation for Economic Cooperation and Development (OECD), India's economic growth prospects in the near term still remain weak and is also facing financial turmoil triggered by possible tapering of quantitative easing policy in the US. OECD Composite Leading Indicators designed to anticipate turning points in economic activities, showed growth below trend rates at 97.1 in July compared to 97.3 in the previous month.

OECD said that emerging Asian economies, which are running high current account deficits (CAD) such as India and Indonesia and more susceptible to macroeconomic risks of capital outflows. Global oil prices will remain volatile and could cloud the inflationary outlook in the near-term. Referring to the economic outlook for Asian economies, OECD said that near term growth prospects are mixed for emerging Asian economies with some sign of growth stabilisation for China and a more positive outlook for the Philippines and Singapore. However, the key imminent downside risk facing Southeast Asia, China and India is the downturn in the financial markets, triggered by the prospects of tapering of the United States quantitative easing (QE) policy, which will be resulted into high volatility in currencies of emerging nations, especially India.

At present, Indian economy is struggling with slowdown with country’s current account deficit (CAD) widened to a record high of 4.8 percent of GDP in the FY14. While, Indian economic growth slowed down to four year low at 4.4 percent in Q1 FY14.

The CNX Nifty is currently trading at 5,849.00 up by 168.60 points or 2.97% after trading in a range of 5,850.55 and 5,738.20. There were 46 stocks advancing against 4 declines on the index.

The top gainers of the Nifty were Tata Motors up by 8.32%, HDFC up by 7.14%, L&T up by 6.58%, Axis Bank up by 6.01% and Ultra Tech up by 5.47%. On the flip side, Cairn down by 1.02%, Dr. Reddy’s Lab down by 0.63%, BPCL down by 0.57% and Lupin down by 0.41 were the major losers on the index.

The Asian equity indices were trading in green; Seoul Composite up by 0.65%, Straits Times up by 0.47%, Hang Seng up by 0.49%, KLSE Composite up by 0.88%, Shanghai Composite up by 0.69% , Nikkei 225 was up by 1.60%, Jakarta Composite up by 1.81% and Taiwan Weighted up by 0.20%.