Benchmarks continue firm trade in afternoon session

Indian equity benchmarks continued to trade firm in afternoon session on the back of buying in IT, Teck and Oil and Gas stocks. Buying was also witnessed in frontline blue-chip stocks including Infosys, Reliance and Tata Motors as firm global cues and appreciation in rupee against the US dollar aided market sentiments. Global risk appetite has improved as soft employment data out of the U.S. eased concerns that the Federal Reserve will accelerate cuts to stimulus. On domestic front, oil and gas stocks were trading higher with Reliance Industries and ONGC both were up by around 2% each after the government notified the new gas pricing policy that would be applicable to all domestically produced gas from April 2014 which will be effective for five years. Furthermore, IT stocks were also trading higher over 1.50% amid expectation of better results for Q3 FY14. On stock specific movements, Infosys, TCS and ONGC were trading up by over 2.30%, while, Tata Power, Hindustan Unilever and Sun Pharma were trading down by over 0.60% on BSE. Tata Motors was up by around 2.3% after its British subsidiary Jaguar-Land Rover (JLR) reported strong 21% year-on-year growth in retail sales.

Among other stocks, Bharat Forge’s share has surged nearly 5% to Rs 347 after the company said its indirect subsidiary in Hong Kong has shed its 51.85% stake in its Chinese joint venture FAW Bharat Forge. Shares of Gati, extending its past two week rally on the BSE, is locked in upper circuit of 10% at Rs 62.30, after ace investor Radhakishan Damani has acquired over 5% stake in the logistics company through open market. On the other hand, pharmaceutical company Ranbaxy Laboratories share value has tanked around 7% to Rs 432 in early noon deals on back of heavy selling volumes as the US Food and Drug Administration (US FDA) is inspecting Ranbaxy’s active manufacturing factory at Toansa in Punjab.

On global front, Asian shares were trading mixed Nikkei 225 up by 0.20% and Shanghai Composite down by 0.38%. Back home, the NSE Nifty and BSE Sensex were trading up their psychological 6,200 and 21,000 levels respectively. The market breadth on BSE was positive, out of 2,359 stocks traded, 1,287stocks advanced, while 919 stocks declined on the BSE.

The BSE Sensex is currently trading at 21,034.31 up by 275.82 points or 1.33% after trading in a range of 21,066.08 and 21,850.54. There were 21 stocks advancing against only 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.27%, while Small cap index up by 0.63%.

The gaining sectoral indices on the BSE were IT up by 2.48%, Teck up by 2.05%, Oil and Gas up by 1.75%, Bankex up by 1.27% and Capital Goods up by 0.91%. While, Healthcare down by 0.55%, Metal down by 0.12% and Power down by 0.02% were the only losing indices on BSE.  

The top gainers on the Sensex were Infosys up by 3.41%, TCS up by 2.55%, ONGC up by 2.38%, Tata Motors up by 2.12% and RIL up by 2.04%. On the flip side, Tata Power down by 1.49%, Hindustan Unilever down by 0.94%, Sun Pharma down by 0.67%, Gail India down by 0.22% and Bajaj Auto down by 0.19%.

Meanwhile, as India is likely to become world's third largest energy consumer by 2020, Prime Minister Manmohan Singh asserted that adequate energy supply at affordable price is critical for economic growth. Stating that India is configuring its policy framework to get back to the high growth rate trajectory, Manmohan Singh added that India seeks clean and affordable energy and the development of energy sector and oil and gas exploration space must be given particular attention.

Manmohan further stated that there is a need to bridge the ever-increasing gap between demand and domestic supply, thus the government is encouraging domestic and global companies to explore potentially hydrocarbon-rich areas in the framework of a stable and enabling policy environment. Currently, India imports around 80 percent of its oil needs and half of its gas requirement. Under the 10th round of NELP, the government has planned to auction 46 oil and gas blocks to domestic as well as overseas oil companies.

Referring to domestic oil and gas production, Prime Minister added that India is currently world's seventh largest energy producer accounting for around 2.5 percent of world's total annual energy production. While, there is a need to increase its energy supply by 3 to 4 times over the next two decades. However, the government has prepared the roadmap to achieve energy security and a number of changes in energy policy regime have been made in the last few months, he added.

Highlighting need of new technologies and processes, innovative thinking and creative business models for oil and gas industry, Manmohan Singh said that the government is also making partnerships with global giants to source technology and produce oil and gas from difficult fields. Presently, only 0.93 million sq km area in India is held under exploration and production in 19 basins as compared to total estimated sedimentary area of 3.14 million square kilometers, comprising 26 sedimentary basins. Meanwhile, the government has formulated a roadmap for cutting India's dependence on imports to meet its energy needs. The Ministry wants domestic crude oil demand to be cut to 50 percent by 2020 and by 25 percent in 2025 through intensive exploration and exploitation of untapped reserves.

The CNX Nifty is currently trading at 6,243.75 up by 72.30 points or 1.17% after trading in a range of 6,259 and 6,189.55. There were 35 stocks advancing against 15 declining on the index.

The top gainers of the Nifty were Infosys up by 3.37%, TCS up by 2.61%, Tata Motors up by 2.45%, ONGC up by 2.34% and HCL Tech up by 2.27%. On the flip side, Ranbaxy down by 6.92%, Tata Power down by 1.37%, JP Associates down by 1.35%, Jindal Steel down by 1.28% and Sun Pharma down by 1.02% were the major losers on the index.

The Asian equity indices were trading mixed; Nikkei 225 up by 0.20%, Seoul Composite up by 0.66%, KLSE Composite up by 0.49%, Taiwan Weighted up by 0.43% and Jakarta Composite up by 2.51%. While, Shanghai Composite down by 0.38%, Straits Times down by 0.24% and Hang Seng down by 0.09%.