Benchmarks continue to trade firm amid buying in banking stocks

Indian equity benchmarks continued to trade firm in afternoon session led by gains in frontline blue chip stocks such as Maruti Suzuki, Sun Pharma and Axis Bank among others. Banking shares both public as well as private sectors were in focus trading higher by up to 5%. There were no losing indices on BSE. Meanwhile, consumer durables was the top gaining index on BSE up by 1.89% followed by bankex trading up by around 1.58%. The sentiments got a boost as Commerce and Industry Minister Anand Sharma has asserted that the government will continue its endeavour for liberalising the FDI Policy to ensure that India retains its leadership position for attracting foreign investments. Further, strong FII capital inflows in previous session and gain in rupee value against the dollar also added to the optimistic sentiments. Meanwhile, markets continued firm trade despite HSBC Manufacturing Purchasing Managers' Index (PMI) fell to 50.7 in December from 51.3 in the previous month. On stock specific movements, Maruti Suzuki, Sun Pharma and Axis Bank were trading up by over 2%, while, NTPC, Bharti Airtel and Coal India were trading down by over 0.60% on BSE. Among other stocks, Pratibha Industries surged nearly 13% to around Rs 30.60 after the company said it has secured construction orders aggregating to Rs 590 crore. 

On global front, Asian equity indices were trading mixed with Jakarta Composite up by 0.96%  and Shanghai Composite declined 12.20 points or 0.58% to 2,103.76. Back home, the NSE Nifty and BSE Sensex were trading up their psychological 6,300 and 21,000 levels respectively. The market breadth on BSE was positive, out of 2,203 stocks traded, 1,396 stocks advanced, while 666 stocks declined on the BSE.

The BSE Sensex is currently trading at 21,290.95 up by 150.47 points or 0.71% after trading in a range of 21,331.32 and 21,140.58. 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 0.89%, while Small cap index up by 0.93%. The gaining sectoral indices on the BSE were Consumer Durables up by 1.89%, Bankex up by 1.58%, Healthcare up by 0.78%, Oil and Gas up by 0.55% and IT up by 0.49%.  There were no losing indices on the BSE.

The top gainers on the Sensex were Maruti Suzuki up by 2.38%, Sun Pharma up by 2.16%, Axis Bank up by 2.03%, HDFC up by 1.69% and ICICI Bank up by 1.56%. On the flip side, NTPC down by 0.80%, Bharti Airtel down by 0.76%, Coal India down by 0.65%  and Bajaj Auto down by 0.32%.

Meanwhile, with an aim to attract more foreign investment in the country, the government has indicated that further liberalisation of the Foreign Direct Investment (FDI) policy may be done soon in key sectors, such as civil aviation, retail and telecom. Commerce and Industry Minister Anand Sharma has asserted that the government will continue its endeavour for liberalising the FDI Policy to ensure that India retains its leadership position for attracting foreign investments.

FDI is considered crucial for economic development of a country and to attract maximum FDI into the country, the government has been liberalizing the foreign investment policy. The government has relaxed FDI norms in around 12 sectors, which include telecom, tea, pension and petroleum and natural gas. Meanwhile, despite the government's various efforts to increase FDI, foreign investments in April-October period of 2013-14 declined by 15 percent to $12.6 billion from a year earlier, which reflects the need to take more measures to improve the business situation in the country.

Referring to Indian manufacturing sector, Anand Sharma highlighted that with greater foreign investment and technology collaborations, Indian manufacturing sector will also move up the value chain and acquire greater competitiveness globally. The minister had expressed the need to boost manufacturing capability underscoring that India is not a country very much endowed with natural resources such as oil and gas, which are necessary for economic growth. Manufacturing sector, constituting around 75 percent share in IIP index, contracted by 0.3 percent during April-October’2013 as compared to the 1.1 percent growth in the same period of previous fiscal.

The CNX Nifty is currently trading at 6,346.40 up by 44.75 points or 0.71% after trading in a range of 6,358.30 and 6,300.65. There were 43 stocks advancing against 7 declining on the index.

The top gainers of the Nifty were Bank of Baroda up by 3.16%, Maruti Suzuki up by 2.35%, PNB up by 2.22%, Power Grid up by 2.21% and Sun Pharma up by 2.21%. On the flip side, NTPC down by 0.90%, Bharti Airtel down by 0.86%, Coal India down by 0.80%, Bajaj Auto down by 0.40% and Jindal Steel down by 0.30% were the major losers on the index.

Most of the Asian equity indices were trading mixed; Shanghai Composite declined 12.20 points or 0.58% to 2,103.76, Hang Seng dipped 31.31 points or 0.13% to 23,337.70, KLSE Composite contracted by 0.62%, Seoul Composite tumbled by 2.20% to 1,967.19. While, Taiwan Weighted was up by 0.01%, Jakarta Composite up by 0.96% and Straits Times was up by 0.17%.