Benchmarks trade higher on firm global cues

Indian equity benchmarks, extending their previous session’s rally, made a gap up opening on Tuesday and are trading in fine fettle with frontline gauges recapturing their crucial 20,900 (Sensex) and 6,200 (Nifty) bastions, buoyed by firm global cues. The US markets rallied in last session, though the stocks cooled off from the their days’ high but remained mostly positive, and the S&P 500 set a new record intraday high on hopes that Fed Chair Janet Yellen may not continue tapering in the face of the weak economic data. Asian markets too were trading mostly higher at this point of time, tracking positive cues from the US and European markets as telecommunication and health-care companies led gains.

Back home, sentiments also remained up-beat on the back of latest survey of National Council of Applied Economic Research (NCAER), which said that after a slide in the second quarter of the current fiscal, higher exports, enhanced farm produce and moderation in inflation improved business confidence during the October-December period. The Business Confidence Index (BCI) rose by about 21.8 percent to 122.3 points from 100.4 in July-September quarter, 2013-14. Also, the Reserve Bank of India (RBI) Governor Raghuram Rajan has said that the central bank’s focus is to bring down inflation to boost investor confidence.

Back home, on the sectoral front technology, software and banking witnessed the maximum gain in trade, while oil and gas remained the lone loser on the BSE sectoral space. The broader indices too were trading in-line with benchmarks, while the market breadth on the BSE was positive; there were 1,020 shares on the gaining side against 481 shares on the losing side while 69 shares remain unchanged.

The BSE Sensex opened at 20877.72; about 66 points higher compared to its previous closing of 20811.44, and touched a high and a low of 20912.54 and 20869.96 respectively. The index is currently trading at 20903.95, up by 92.51 points or 0.44%. There were 19 stocks advancing against 11 declines on the index.

The overall market breadth has made a strong start with 64.55% stocks advancing against 30.67% declines. The broader indices too were trading in green; the BSE Mid cap index up was by 0.67% and Small cap gained 0.52%. 

The top gaining sectoral indices on the BSE were, Consumer Durables up by 1.44%, Teck up by 1.00%, IT up by 0.95%, Bankex up by 0.63% and Healthcare up by 0.59%, while PSU down by 0.27% and Oil & Gas down by 0.05% were the top losers on the sectoral index.

The top gainers on the Sensex were BHEL up by 2.01%, Bharti Airtel up by 1.56%, Wipro up by 1.55%, ICICI Bank up by 1.01% and Infosys up by 0.97%. On the flip side, NTPC was down by 1.75%, Gail India was down by 1.61%, Coal India was down by 1.35%, SSLT was down by 0.68% and  ONGC was down by 0.67% were the top losers on the Sensex.

Meanwhile, In order to align the country with the global financial standards, India will adopt international financial standards from April 2015 for companies with a net worth of more than Rs 1,000 crore. Indian corporate affairs ministry is likely to notify soon all sections and rules of the new Companies Act to converge Indian Accounting Standards (IAS) with the International Financial Reporting Standards (IFRS). The Institute of Chartered Accountants of India (ICAI), the accounting regulator had submitted revised road map to corporate affairs ministry for the implementation of IFRS from next April.

It has become imperative for India to adopt IFRS which has already been implemented by 130 countries. The IFRS mandates extensive disclosures and is considered a more credible tool for accounting. In the first phase, IFRS will be implemented by large-sized companies having net worth of over Rs 1,000 crore. Meanwhile, during the second phase that will begin from April 1, 2016 will involve both listed and unlisted companies with a net worth of over Rs 500 crore but less than Rs 1,000 crore. The implementation of IFRS is expected to put significant impact on all sectors, especially banking and real estate. Further, the new accounting standards will help the investors for making mark-to-market projections and valuation of financial assets, among other things.

However, industry bodies such as Assocham, Ficci and CII and had sought postponement of implementation of IFRS arguing that the companies needed more time to adopt the global standards. At present, Indian companies doing business abroad and listed overseas prepare financial statements as per international standards.

The CNX Nifty opened at 6,205.70; about 19 point higher as compared to its previous closing of 6,186.10, and has touched a high and a low of 6,216.85 and 6,205.35 respectively. The index is currently trading at 6,215.85, up by 29.75 points or 0.48%. There were 38 stocks advancing against 12 declines on the index.

The top gainers of the Nifty were Ambuja Cements up by 5.40%, IDFC up by 3.24%, BHEL up by 1.88%, Wipro up by 1.75% and Bharti Airtel up by 1.59%. On the flip side, Gail down by 2.12%, Coal India down by 1.55%, NTPC down by 1.37%, SSLT down by 0.98% and ONGC down by 0.73% were the top losers on the index.

Most of the Asian equity indices were trading in green; Shanghai Composite added 1.98 points or 0.10% to 2,078.67, Hang Seng gained by 110.42 points or 0.49% to 22,498.98, Nikkei 225 soared 213.63 points or 1.44% to 15,051.31, Straits Times spurted 2.83 points or 0.09% to 3,108.67, Seoul Composite rose 13.25 points or 0.68% to 1,962.30 and Taiwan Weighted was up by 16.69 points or 0.19% to 8,577.30.

On the flip side, Jakarta Composite declined 24.84 points or 0.54% to 4,598.73 and KLSE Composite was down by 0.16 points or 0.01% to 1,828.52.