Benchmarks continue to trade firm in afternoon session

Indian equity benchmarks continued to trade in green in afternoon session led by gains in frontline blue chip stocks including Maruti Suzuki, Sun Pharma and BHEL among other. The firm global cues and appreciation in rupee value against dollar added to the optimistic sentiments. Investors were seen piling up position in fundamentally strong stocks available at cheaper valuation. Healthcare was the top gaining index on BSE up by 2 percent followed by auto and capital goods both up by over 90%. Metal shares witnessed profit taking after recent gains with Tata Steel, Sesa Sterlite and Hindalco were down around 1-2% each. On stock specific movement, Maruti Suzuki, Sun Pharma and BHEL were trading up by over 2.40%, while, Tata Steel, SSLT and Hindalco Inds were trading down by 1.20% on BSE.

Maruti Suzuki shares rebounded in current session and continued to remain as the top BSE gainer up by around 6% at around Rs 1673 amid short covering. The stock had witnessed a sharp fall on Tuesday after its board’s decision to accept Suzuki Motor Corp’s (SMC) proposal to contract manufacture vehicles from the proposed manufacturing facility in Gujarat. Shares of Bharti Airtel were up over 2% at Rs 310 amid robust earnings growth and higher revenue growth from overseas operations. Ipca Laboratories has rallied nearly 5% to its record high at Rs 834 on the BSE, after it posted a strong 58% yoy jump in its net profit at Rs 139 crore for Q3FY14.

On global front, Asian shares were trading in green with Seoul Composite up by 1.15% and Hang Seng up by 0.93%. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,150 and 20,700 levels respectively. The market breadth on BSE was positive, out of 2,172 stocks traded, 1,256 stocks advanced, while 787 stocks declined on the BSE.

The BSE Sensex is currently trading at 20,745.78 up by 62.27 points or 0.30% after trading in a range of 20,828.68 and 20,734.28. There were only 20 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.66%, while Small cap index up by 0.56%.

The gaining sectoral indices on the BSE were Healthcare up by 2.00%, Auto up by 1.18%, Capital Goods up by 0.92%, Teck up by 0.49% and IT up by 0.45%. While, Metal down by 0.94% and FMCG down by 0.08% were the losing indices on BSE.   

The top gainers on the Sensex were Maruti Suzuki up by 7.08%, Sun Pharma up by 3.61%, BHEL up by 2.43%, Cipla up by 1.81% and Dr Reddy’s Lab up by 1.13%. On the flip side, Tata Steel down by 1.58%, SSLT down by 1.53%, Hindalco Inds down by 1.27%, SBI down by 1.00% and ITC down by 0.57%.

Meanwhile, the Reserve Bank of India (RBI) has forecasted the Indian economic growth to fall below 5 percent in 2013-14 as the prospects of a pick-up in real GDP growth in the second half of 2013-14 have been dampened by negative growth witnessed in industrial production over two consecutive months. In the previous fiscal, India's economic growth slowed down to a decade low of 5 percent owing to the global slowdown as well as domestic factors such as high inflation and interest rates.

The RBI in its latest Macroeconomic and Monetary Developments report, highlighted that consumption demand would continue to weaken and lackluster capital goods production indicated stalled investment demand. However, giving some respite, it asserted that growth is likely to recover to 5.5 percent in the next financial year and added that there could also be a case of gradual recovery to the 5-6 percent band on the back of fast track implementation of infrastructure projects cleared by the Cabinet Committee on Investments (CCI), global growth recovery and easing inflation.

Referring to country’s external sector, the report said the current account deficit, which widened to all time high of 4.8 percent of GDP in FY13, will ease to 2.5 percent this fiscal. On the exchange rate front, the RBI expects the rupee to be at the 61 levels by December 2014. However, the central bank expressed concerns over the coming general elections adding that new government’s commitment to reforms hold the key for the future stability of the market and the rupee.

The CNX Nifty is currently trading at 6,149.60 up by 23.35 points or 0.38% after trading in a range of 6,170.45 and 6,146.45. There were only 37 stocks advancing against 13 declining on the index.

The top gainers of the Nifty were Maruti up by 6.86%, Sun Pharma up by 3.73%, BHEL up by 2.53%, Ranbaxy up by 2.33% and BPCL up by 2.31%. On the flip side, Tata Steel down by 1.95%, SSLT down by 1.48%, Hindalco down by 1.27%, Indusind Bank down by 1.14% and SBI down by 1.08% were the major losers on the index.

The Asian equity indices were trading in green; Seoul Composite up by 1.15%, Hang Seng up by 0.93%, KLSE Composite up by 0.66%, Jakarta Composite up by 1.84%, Shanghai Composite up by 0.37% and Nikkei 225 up by 2.61%. While, Straits Times down by 0.67%.