Markets continue firm trade in afternoon session

Indian equity benchmarks continued their firm trade in afternoon session led by gains in rate-sensitive stocks such as realty and banking stocks on the back of positive cues from global peers ahead of the US Federal Reserve meeting. Investors hoped that US Fed is likely to continue with its bond purchase program to support the global economy. Buying was also witnessed in healthcare, teck and power stocks. On stock specific movement, Bharti Airtel, Dr Reddy’s Lab and BHEL were trading up by over 2%, while, Wipro, M&M and SSLT were trading lower by over 1% on BSE. Bharti Airtel is the top Sensex gainer, up nearly 4% after the company reported its consolidated operating or EBITDA margin improvement for the second quarter ended September 2013. Among other shares, Financial Technologies (India) stock has soared around 11% on back of heavy volumes on the bourses and Tata Communications was trading up by around 10% on BSE, after reporting a consolidated net profit of Rs 80 crore for the Q2FY14.

On the global front, Asian markets were trading in green with Japanese index Nikkei up by 1.09% as global risk appetite has improved amid hopes that the Federal Reserve will maintain its stimulus. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,200 and 20,500 levels respectively. The market breadth on BSE was positive, out of 2,065 stocks traded, 1,090 stocks advanced, while 848 stocks declined on the BSE.      

The BSE Sensex is currently trading at 20,976.37 up by 47.36 points or 0.23% after trading in a range of 21,037.59 and 20,937.12. There were only 19 stocks advancing against 11 declines on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.50%, while Small cap index up by 0.82%.

The gaining sectoral indices on the BSE were Realty up by 1.68%, Healthcare up by 0.91%, Bankex up by 0.54%, Teck up by 0.47% and Power up by 0.36%. While, Auto down by 0.27%, FMCG down by 0.25%, Metal down by 0.18% and Oil and Gas down by 0.13% were losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 4.43%, Dr Reddy’s Lab up by 2.37%, BHEL up by 2.35%, ICICI Bank up by 1.96% and Bajaj Auto up by 1.26%. On the flip side, Wipro down by 1.83%, M&M down by 1.70%, SSLT down by 1.10%, Tata Power down by 0.86% and ONGC down by 0.83% were the only losers on the Sensex.

Meanwhile, the coal block auction to private firms is likely to get delayed to March next year from December, 2013 as the government has enhanced the action target to 10 blocks from 6 coal blocks planned earlier. Coal Ministry has asked CMPDIL, the mine planning and consultancy company of Coal India, to assess the reserves of four more coal mines and submit its report by the next year. The government wants to allot coal blocks to private players in order to kickstart coal mining in a public-private partnership (PPP) mode in the country. Further, the move will help to enhance country’s coal production for meeting India’s growing coal demand and will also end the monopoly of public sector unit Coal India. In July, the government had earlier allocated 14 coal mines to central and state public sector units, including four to NTPC.

In the previous month, the government has approved the new methodology for auctioning coal blocks in order to provide upfront and production-linked payments and benchmarking of coal sale prices. The move will ensure greater transparency in auctioning the fully explored coal blocks and will also enable the government to allot coal mining licences through competitive bidding for the first time. The government will put coal blocks for auction after the environment ministry reviews and bidders approval to a minimum work programme. According to the new methodology, bidders have to provide production-linked payment on rupee per tonne basis, plus a basic upfront payment of 10 percent of the intrinsic value of the coal block. Meanwhile, intrinsic value will be calculated based on net present value (NPV) of the block arrived through the discounted cash flow (DCF) method.

The CNX Nifty is currently trading at 6,236.45 up by 15.55 points or 0.25% after trading in a range of 6,253.65 and 6,222.60. There were 32 stocks advancing against 18 decline on the index.

The top gainers of the Nifty were Bharti Airtel up by 4.59%, Dr Reddy’s Lab up by 2.38%, BHEL up by 2.38%, ICICI Bank up by 2.08% and Indusind Bank up by 2.08%. On the flip side, M&M down by 2.05%, Wipro down by 1.84%, SSLT down by 1.17%, Tata Power down by 1.11% and Ultra Tech Cement down by 1.10% was the major loser on the index.

The Asian equity indices were trading in green; Taiwan Weighted up by 0.52%, Seoul Composite up by 0.38%, Straits Times up by 0.35%, Nikkei 225 up by 1.09%, Shanghai Composite up by 0.87% and Hang Seng up by 0.87%. While, Jakarta Composite down by 0.09% and KLSE Composite down by 0.11%.