Benchmarks extend early gains in afternoon session; trade at intra-day high level

Indian equity benchmarks extended early gains and reached at their intra-day high level in afternoon session on the back of buying witnessed in metal, banking and realty stocks amid positive global cues. All the sectoral indices on BSE were in the green with banks, metals and realty leading the upmove. Metal stocks were trading up by over 2% higher on BSE as China's economy grew 7.8% in July-September, its fastest pace this year. China is the world's largest consumer of copper and aluminium. Investors’ sentiments also got a support after SEBI suggested that lowering of securities transaction tax (STT) will boost domestic capital markets. On the global front, Asian markets were trading mixed with Shanghai Composite up by 0.43%, while Japanese index Nikki down by 0.17% . Meanwhile, global risk appetite has improved amid hopes that the Federal Reserve would extend its stimulus efforts, began to offset worries about the economic impact of a 16-day government shutdown.

NSE Nifty and BSE Sensex were trading above their psychological 6,000 and 20,500 levels respectively. The market breadth on BSE was positive, out of 2,097 stocks traded, 1,226 stocks advanced, while 741 stocks declined on the BSE. Among the individual stocks, Tata Steel up by 4.34%, Jindal Steel up by 1.60% and Hindustan Zinc up by 2%.

Back, home, the BSE Sensex is currently trading at 20,728.66 up by 313.15 points or 1.53% after trading in a range of 20,765.13 and 20,486.78. There were only 28 stocks advancing against 2 declines on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.93%, while Small cap index up by 0.69%.

The gaining sectoral indices on the BSE were Bankex up by 2.64%, Metal up by 2.39%, Realty up by 1.47%, Oil and Gas up by 1.41% and Auto up by 1.21%. While, there were no losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 4.34%, SSLT up by 4.02%, ICICI Bank up by 2.64%, HDFC up by 2.54% and HDFC Bank up by 2.49%. On the flip side, Bajaj Auto down by 0.32% and BHEL down by 0.10 were the only losers on the Sensex.

Meanwhile, moody's Analytics, an arm of the global credit ratings agency Moody's, has said that Indian economy has bottomed out and recovery is on the way on the back of improved investments, as the government has been actively trying to restart stalled investment projects, both in the public and private sectors. However, the recovery will be modest, as weak business sentiment will take time to turn around and fixed investment is expected to grow by 3.5 per cent in 2014 after being flat in 2013.

By adding further, Moody’s said that Indian economy would not achieve 8 percent GDP growth rate again soon and is likely to grow at its potential growth rate of 6.5 per cent by the second half of 2015. Weak investment scenario amid prevailing global economic slowdown and contracted consumer demand on account of high inflation has slowed down Indian economy’s growth to around 5 percent in FY13 from average growth rate of over 8 percent recorded over the past few fiscal years. It added that prudent macroeconomic policies and continued reforms will drive steady acceleration in economic activity, although the upturn will be patchy and difficult for the coming six months.

Recently, the International Monetary Fund (IMF) has cut Indian economic forecast to 3.75 percent in 2013 from 5.7 percent projected earlier, while, the World Bank has revised economic growth forecast downwards to 4.7 percent for the current fiscal from 6.1 percent growth projected earlier. At present, Indian economy is struggling with slowdown and its growth has slowed down to four year low at 4.4 percent in April-June quarter, 2013. Further, all macro-economic indicators have deteriorated with current account deficit (CAD) widening to a record high of 4.9 per cent of GDP in the April-June quarter, 2013. Further, rupee value has also depreciated over 15 percent against dollar in 2013, which has become a cause of concern for the country, as India is structurally an import intensive country.

The CNX Nifty is currently trading at 6,139.55 up by 93.70 points or 1.55% after trading in a range of 6,152.90 and 6,070.90. There were 49 stocks advancing against 1 decline on the index.

The top gainers of the Nifty were Indusind Bank up by 4.47%, Tata Steel up by 4.45%, SSLT up by 4.13%, JP Associate up by 2.91% and ICICI Bank up by 2.76%. On the flip side, BHEL down by 0.34% was the major loser on the index.

The Asian equity indices were trading in Green; Taiwan Weighted up by 0.79%, Seoul Composite up by 0.58%, Straits Times up by 0.34%, Shanghai Composite up by 0.43% and Hang Seng up by 0.99%. While, Jakarta Composite down by 0.13%, KLSE Composite down by 0.01% and Nikki 225 down by 0.17%.