Markets continue to trade firm in afternoon session

Indian equity benchmarks continued to trade firm in afternoon session amid buying witnessed in banking, capital goods and realty stocks, as the market gave thumbs up to exit polls which suggested that the BJP will emerge as the largest party in the recently held assembly elections. Despite the global weak cues and a stern warning from Moody's Investors Service that the economy could be downgraded if the government adopts policies that harm fiscal and growth scenario, markets continued firm trade and buying witnessed in all indices on BSE except IT and Healthcare. Banking shares were trading higher in the range of 3-6% on the BSE. On stock specific movement, ICICI Bank, HDFC Bank and L&T were trading up by over 4% higher, while, Dr Reddy’s Lan, Sun Pharma and Wipro were trading marginally lower on BSE. Among other stocks, Pfizer and Wyeth tumbled over 15 percent on turning ex-dividend.

On global front, Asian markets were trading in red with Nikkei 225 down by 1.99% and Straits Times down by 0.38% amid uncertainty about the outlook for the US and Federal Reserve’s stimulus program. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,200 and 21,000 levels respectively. The market breadth on BSE was positive, out of 2,130 stocks traded, 1,259 stocks advanced, while 757 stocks declined on the BSE. 

The BSE Sensex is currently trading at 21,064.04 up by 355.33 points or 1.72% after trading in a range of 21,165.60 and 20,992.25. There were 26 stocks advancing against only 4 stocks declining 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 0.66%.

The gaining sectoral indices on the BSE were Bankex up by 4.35%, Capital Goods up by 3.35%, Realty up by 2.58%, PSU up by 1.71% and Oil and Gas up by 1.68%. While, Healthcare down by 0.30% and IT down by 0.04% were losing indices on BSE.

The top gainers on the Sensex were ICICI Bank up by 6.09%, HDFC Bank up by 4.13%, L&T up by 4.04%, BHEL up by 3.50% and Maruti Suzuki up by 2.79%. On the flip side, Dr Reddy’s Lab down by 0.95%, Sun Pharma down by 0.68%, Wipro down by 0.28% and Infosys down by 0.04%.

Meanwhile, the International Energy Agency (IEA), in its annual World Energy Outlook, has said that global energy demand is switching decisively in favour of emerging economies and India will become the largest single source of global oil demand growth after 2020, mainly on back of rising economic growth and increase in population. China will dominate oil demand in Asia till 2020 before Indian will take over the position as the major global oil demand driver, it added.  IEA's World Energy Outlook 2013 forecasts the global oil demand to reach 101 million barrels per day (mbpd) by year 2035 from present demand of around 87 mbpd.

IEA head Maria van der Hoeven said that by 2035, India's energy demand will double and the country will also become the largest importer of coal and fourth largest importer of natural gas after European Union, China and Japan. However, India’s per capita consumption of energy will remain one-fourth of the OECD average. Regarding the rising coal consumption in India, V D Hoeven said that coal imports will rise primarily because India uses the fossil fuel for generation of electricity. Coal is major source of power generation in India accounting for around 68 percent of electricity produced in the country.

Referring to India’s recent efforts for shale gas production, IEA has said that Indian may have shale gas potential, but it has to overcome challenges including public acceptance of shale exploration and will have to put in place proper infrastructure to transport gas, develop gas industry, solve water problem, proper fiscal regime, land laws and a remunerative gas price.

Shale gas has become an increasingly important source of natural gas in the United States over the past decade, and now interest has spread to potential shale gas reserves in Canada, Europe, Asia, and Australia. India too has initiated shale gas exploration programme and it is estimated that recoverable reserves of shale gas in the country is between 6 trillion cubic feet to 63 trillion cubic feet. The move is also a part of oil ministry’s roadmap for cutting India's dependence on imports to meet its domestic energy needs.

The CNX Nifty is currently trading at 6,272.65 up by 111.70 points or 1.81% after trading in a range of 6,300.55 and 6,262.40. There were 43 stocks advancing against 7 declining on the index.

The top gainers of the Nifty were IDFC up by 6.36%, ICICI Bank up by 5.97%, L&T up by 4.30%, HDFC Bank up by 4.24% and Axis Bank up by 4.22%. On the flip side, Dr Reddy’s Lab down by 0.99%, Sun Pharma down by 0.57%, Cairn India down by 0.47%, Lupin down by 0.36% and Wipro down by 0.26% were the major losers on the index.

The Asian equity indices were trading in red; Nikkei 225 down by 1.40%, Straits Times down by 0.92%, Hang Seng down by 0.41%, Seoul Composite down by 0.03%, Jakarta Composite down by 0.98%, Taiwan Weighted down by 0.50%, and Shanghai Composite down by 0.36%. While, KLSE Composite up by 0.19%.