Benchmarks trade in green; Auto, Metal lead

Indian equities added gains to trade in green in the late afternoon session on account of buying in front line counters and taking cues from European counterparts. The sentiments were on lackadaisical mood and trade continued to remain largely range-bound in absence of any catalyst, which could drive the markets, ahead of the crucial Infosys’ Q2 earnings and IIP data scheduled to be released tomorrow. The sentiments were lethargic despite Economic Affairs Secretary Arvind Mayaram stating that the country still has the potential for achieving a growth rate of more than five percent this fiscal year, a day after the IMF drastically scaled down India’s growth rate to a mere 3.8 percent. Traders were seen piling positions in Auto, Metal and Consumer Durables stocks, while selling was witnessed in Bankex and Oil & Gas sector stocks. In scrip specific development, hectic activity was witnessed in Bajaj Auto after foreign brokerage firm Deutsche Bank downgraded the stock to hold from buy and cut the target price citing that current valuations have already priced in a robust margin trend. PTC India Financial Services was trading in green on reporting profit after tax which rose 4.34% to Rs 30 crore in the quarter ended September 30.

On the global front, the Asian markets were trading on a mixed note while the European markets were trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,000 and 20,200 levels respectively. The market breadth on BSE was positive in the ratio of 1299:927 while 144 scrips remained unchanged.  

The BSE Sensex is currently trading at 20267.99, up by 18.73 points or 0.09% after trading in a range of 20,323.77 and 20,135.91. There were only 16 stocks advancing against 14 declines on the index.

The broader indices continued to outperform their larger peers; the BSE Mid cap and Small cap indices were trading up by 0.74% and 0.71% respectively.

The gaining sectoral indices on the BSE were Auto up by 1.42%, Metal up by 0.93%, Consumer Durables up 0.67%, PSU up by 0.50% and Capital Goods up by 0.47%. While, Bankex down by 0.16% and Oil & Gas down by 0.05% remained the only losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 3.11%, Jindal Steel up by 2.11%, Tata Steel up by 1.78%, SSLT up by 1.74% and NTPC up by 1.59%. On the flip side, Tata Power down by 1.92%, Gail India down by 1.37%, Hindalco Industries down by 1.21%, HDFC Bank down by 1.16%, and Sun Pharma down by 0.71% were the top losers on the Sensex.

Meanwhile, with an aim to attract road developers and to revive country’s highway sector, the government is reconsidering its exit policy for road developers in order to resolve taxation issues in policy. Earlier, in June, the government had approved a policy that allows infrastructure developers to exit highway projects by divesting their entire stake. The government was of the view that new policy will help to expedite implementation of road infrastructure in the country and insulate the highways authority from heavy financial claims and unnecessary disputes. Meanwhile, the government's exit policy has not attracted road developers because of its complicated structure. After the policy was formalized, highway developers had also raised concerns over the taxation structure in special purpose vehicles (SPV) executing the projects.

The ministry of road transport and highways is taking measures to revive the growth in highway road projects in the country and has recently asked the government to provide flexibility in the model concession agreement (MCA) to allow the National Highways Authority of India (NHAI) board to make changes in proposed road projects, if required.

Further the ministry would like provisions in the public-private partnerships (PPPs) contracts that allow re-negotiations as PPPs are long-term partnerships spread over 20-25 years. The government has entered into the 'Public Private Partnership (PPP)' programme in order to bring adequate resources for setting up of a sound and efficient infrastructural base. The CNX Nifty is currently trading at 6,020.25, up by 12.80 points or 0.21% after trading in a range of 6,033.95 and 5,979.80. There were 31 stocks advancing against 19 declines on the index.

The top gainers of the Nifty were Ranbaxy up by 3.71%, Tata Motors up by 3.11%, Lupin up 2.67%, Asian Paints were up by 2.51% and NMDC up by 2.48%. On the flip side, Tata Power down by 2.04%, Kotak Mahindra Bank down by 1.36%, HDFC Bank down by 1.26%, Hindalco down by 1.21% and Gail India down by 1.15% were the major losers on the index.

The Asian equity indices were trading mixed; Jakarta Composite up by 0.72%, Straits Times up by 0.60%, Nikkei 225 up by 1.12% and KLSE Composite up by 0.38%. While, Hang Seng down by 0.36%, Seoul Composite down by 0.07% and Shanghai Composite down by 0.94%. Taiwan Weighted remained closed on account of National Day.

The European markets were trading in green; France’s CAC 40 was up 1.31%, Germany’s DAX added 0.94% and UK’s FTSE 100 gained 0.78%.