Trade remains steady aided by good start in European markets

Markets are not moving anywhere in the late noon trade but are managing to hold the gains that they have garnered since morning. Although, the momentum of gains has slowed but all the sectoral indices, barring realty were trading in green. The global cues were mainly aiding to the sentiments as most of the Asian peers snapped the session in green, up in the range of 1-3 percent, while the European markets too have made a good start, supporting the markets further. Marketmen were taking positive cues from the International Monetary Fund’s (IMF) revising its previous forecast of GDP growth upwards to a 4.6 per cent in FY14 and an improvement to 5.4 per cent in FY15. However, it has recommended India to go for more interest rate hikes to tackle high inflation and its expectations. In scrip specific movement Coal India was marginally in red with the Union Cabinet finally clearing the coal ministry’s proposal for setting up a regulator through an executive order for the coal sector. Telecom stocks too were sulking, reacting negatively to the Department of Telecom issuing the much-awaited guidelines for merger and acquisition (M&A) in the industry.

The BSE Sensex is currently trading at 20691.44, up by 154.80 points or 0.75% after trading in a range of 20725.04 and 20599.91. There were 22 stocks advancing against 8 declining ones on the index.

The broader indices were trading steady neck-in-neck to the benchmarks; the BSE Mid cap index was up by 0.69%, while Small cap index has gained 0.64%.

The top gaining sectoral indices on the BSE were, FMCG up by 1.18%, Bankex up by 1.12%, Metal up by 0.84%, Oil & Gas was up by 0.79%, Capital Goods up by 0.69% and IT up by 0.69%. While, Realty down by 0.45% was the lone losing index on the BSE.   

The top gainers on the Sensex were Axis Bank up by 2.70%, ITC up by 1.70%, Tata Steel up by 1.65% and ICICI Bank was up by 1.60%. On the flip side, Bharti Airtel down by 1.75%, BHEL down by 1.16%, Hero MotoCorp down by 0.91%, Cipla down by 0.86% and Sun Pharma down by 0.59% were the top losers.

Meanwhile, after seven long years, two cabinet meetings and five odd sittings of a 12-member Group of Ministers (GoM), the proposal to set-up coal regulator got the approval from the Cabinet Committee on Economic Affairs, chaired by Prime Minister, Manmohan Singh. However, with little or no chances of Parliament giving its nod for Coal Regulatory Authority Bill 2013, CCEA approved setting up of the regulator through an executive order that would have only recommendatory powers. Thus, now only the new government can take this initiative and get the legislative approval after the general elections.

Under this arrangement, the regulator would have the powers to specify the principles and methodology for determination of price of raw coal and washed coal and any other by-product generated during washing. It could also regulate methods for testing for declaration of grades or quality of coal, specify procedure for automatic coal sampling and adjudicate upon disputes between the parties besides monitoring closure of mines and approval of mining plans, among other things.

This development comes at a time when lack of transparency in distribution of reserves led to a ruckus over allegedly favorable allocations that led to a notional loss of Rs 1.86 lakh crore to the exchequer, according to the Comptroller and Auditor General of India (CAG).

The group of Ministers was set up in May 2012 by the cabinet after key infrastructure ministries were logger heads over the functions and powers to be assigned to the regulatory authority. The ministerial panel, which met between July 2012 and May 2013, redrafted the provisions of the bill to ensure the regulator’s power do not overlap with safety laws administered by the labor ministry and environment and forest laws governed by the Ministry of Environment and Forests (MoEF). The pricing power too was then snatched away from the regulator based on the argument that coal prices were decontrolled in stages between 1996 and 2000 and de-nationalization of the sector is not envisaged.

The CNX Nifty is currently trading at 6,144.75, up by 53.30 points or 0.87% after trading in a range of 6,148.60 and 6,108.00. There were 41 stocks advancing against 9 declining ones on the index.

The top gainers of the Nifty were Ambuja Cements up by 5.60%, UltraTech Cements up by 3.93%, ACC up by 3.74%, BPCL up by 3.59% and Axis Bank up by 2.78%. On the flip side, Bharti Airtel down by 1.82%, DLF down by 1.32%, Ranbaxy down by 1.30%, BHEL down by 1.06% and Cipla down by 0.79% were the major losers on the index.

All the Asian equity indices barring the Chinese market ended in green. Shanghai Composite was down by 1.17%, reacting to the weak manufacturing data released yesterday.

On the other hand Hang Seng gained 0.41%, Jakarta Composite was up by 0.88%, KLSE Composite ended up by modest 0.02%, Nikkei 225 surged by 2.88%, Straits Times added 0.53%, Seoul Composite was up by 1.41% and Taiwan Weighted gained 0.91%.

The European markets have made a good start; France’s CAC 40 was up by 0.27%, Germany’s DAX was up by 0.30% and UK’s FTSE 100 strengthened by 0.60%.