Benchmarks trade higher in early deals on Thursday

Indian equity benchmarks, coming out of the consolidation mood, have made a gap-up opening and are trading with traction in early deals on Thursday. Sentiments remained higher on report that foreign institutional investors (FIIs) bought shares worth a net Rs 10.16 crore on January 1, 2014, as per provisional data from the stock exchanges. Some support also came in from rally in shares of public sector oil marketing companies (PSU OMCs) as their under-recovery on diesel declined for the first fortnight of January 2014 and after they reported hike in the price of non-subsidised cooking gas (LPG) by a steep Rs 220 per cylinder on Wednesday on firming international rates. Meanwhile, the PSU OMCs also increased the price of aviation turbine fuel (ATF) by 2.7%.

On the global front, Asian markets were trading in the red at this point of time on account of weaker-than-expected manufacturing data out of China, while US markets remained closed on account of New Year’s Day. Back home, Indian rupee was marginally higher in range-bound trade, at 61.82/83 versus previous close of 61.90/91 per dollar. However, traders remained a little cautious ahead of the HSBC Manufacturing PMI data to be released later in the day. India’s manufacturing sector had witnessed an expansion in November for the first time since July, driven by rising new domestic orders..

All the sectoral indices on the BSE were trading in the green with banking and consumer durables segments gaining the most. Realty, capital goods, oil and gas, power and software too were trading with significant gains. The broader indices too were trading in line with benchmarks, while the market breadth on the BSE was positive; there were 1013 shares on the gaining side against 253 shares on the losing side while 46 shares remain unchanged.

The BSE Sensex opened at 21179.91; about 39 points lower compared to its previous closing of 21140.48, and touched a high and a low of 21331.32 and 21140.58 respectively.

The index is currently trading at 21296.50, up by 156.02 points or 0.74%. There were 27 stocks advancing against 3 declines on the index.

The overall market breadth has made a strong start with 80.00% stocks advancing against 16.29% declines. The broader indices too were trading in green; the BSE Mid cap index up was by 0.86% and Small cap gained 0.83%. 

The top gaining sectoral indices on the BSE were, Bankex up by 1.43%, Consumer Durables up by 0.91%, Realty up by 0.82%, PSU up by 0.77% and Capital Goods up by 0.68%, while there were no losers on the sectoral index.

The top gainers on the Sensex were Axis Bank up by 2.12%, HDFC up by 1.53%, ICICI Bank up by 1.52%, Gail India up by 1.27% and HDFC Bank up by 1.01%. On the flip side, Bharti Airtel was down by 0.56%, Coal India was down by 0.36% and NTPC was down by 0.04% were the top losers on the Sensex.

Meanwhile, Disappointed over the slowdown in the highway projects, the National Highways Authority of India (NHAI) has blamed abnormal delays in getting environment and forest clearances. The NHAI has noted that ministry of environment and forests (MoEF), through its recently changed policy, has created hurdles for environment and forest clearances, which have affected highway projects worth about Rs 20,000 crore and forced the NHAI to approach Supreme Court.

The NHAI highlighted that over the past two years, the highway sector is struggling with slowdown as around 40 highway projects have failed to commence or be completed. In the current fiscal, NHAI has managed to give just 479 km of road projects against its target of 3,000 km by September. In the previous financial year, only 1,116 km of projects were awarded against a target of 9,500 km. Furthermore, NHAI has stressed that it could have terminated the contracts and blacklisted developers for not fulfilling their contractual obligation however that would have meant annoying a large number of private operators.

Meanwhile, Road and Highway ministry has been taking measures to speed up the implementation of road projects. Recently, in order to attract road developers and to revive country’s highway sector, the ministry had approved a policy that allows infrastructure developers to exit highway projects by divesting their entire stake. 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. Further, the ministry would like to make provisions in the public-private partnerships (PPPs) contracts that allow re-negotiations as PPPs are long-term partnerships spread over 20-25 years.

The CNX Nifty opened at 6,301.25; about 0.40 point lower as compared to its previous closing of 6,301.65, and has touched a high and a low of 6,358.30 and 6,300.65 respectively. The index is currently trading at 6,347.40, up by 45.75 points or 0.73%. There were 45 stocks advancing against 4 declines and one stock remains unchanged on the index.

The top gainers of the Nifty were Axis Bank up by 2.72%, Bank of Baroda up by 1.92%, Power Grid up by 1.86%, HDFC up by 1.69% and DLF up by 1.65%. On the flip side, Bharti Airtel down by 0.61%, NTPC down by 0.29%, Coal India down by 0.27% and Jindal Steel down by 0.21% were the top losers on the index.

Most of the Asian equity indices were trading in red; Shanghai Composite declined 9.28 points or 0.44% to 2,106.70, Hang Seng dipped 57.23 points or 0.25% to 23,249.16, KLSE Composite contracted 11.32 points or 0.61% to 1,855.64, Seoul Composite tumbled 31.01 points or 1.54% to 1,980.33 and Taiwan Weighted was down by 5.04 points or 0.06% to 8,606.47.

On the flip side, Jakarta Composite added 37.88 points or 0.89% to 4,312.06 and Straits Times was down by 6.01 points or 0.19% to 3,173.44.

Japanese markets remained closed for the trade today.