Benchmarks continue to trade firm in afternoon session

After recovering from intraday lows in early trades, Indian equity benchmarks continued to trade firm in afternoon session on the back of buying witnessing in frontline blue-chip stocks such as wipro, hindalco and Tata steel stocks. Sentiments got a boost as CPSE- ETF, involving the equity shares of ten PSUs, has garnered cumulative bids of over Rs 2,400 crore at the end of third day on March 20, which will help the government to achieve the revised disinvestment target of Rs 16,000 crore for the current fiscal. The RBI Governor Raghuram Rajan statement that the central bank is working on new regulatory structure to strengthen country’s financial sector also provided the support to the market. While most of the sectoral indices were trading in green, there was some weakness in the Oil and Gas and FMCG stocks. Realty index was the top gainer on BSE up by around 1.83% followed by metal and power indices both up by over 1%.

On stock specific movement, Sunil Hitech Engineers has rallied 13% to around Rs 69.30 after its board allotted 1.35 million shares of the company upon conversion of warrants to the promoter group. Claris Lifesciences was trading higher by 3% at nearly Rs 187 after the pharmaceutical company announced to buyback of up to 9.25 million equity shares at a price of Rs 250 per share through the tender offer process.

On global front, Asian equity indices were trading mixed with Nikkei 225 down by 1.65% and Hang Seng up by 0.82%. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,500 and 21,700 levels respectively. The market breadth on BSE was positive, out of 2,353 stocks traded, 1,347 stocks advanced, while 873 stocks declined on the BSE.

The BSE Sensex is currently trading at 21,787.03 up by 46.94 points or 0.22% after trading in a range of 21,870.11 and 21,738.38. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.81%, while Small cap index up by 0.73%.

The gaining sectoral indices on the BSE were Realty up by 1.83%, Metal up by 1.61%, Power up by 1.09%, Consumer Durables up by 0.85% and Bankex up by 0.70%. While, Oil and Gas down by 0.67% and FMCG down by 0.10% were the losing indices on BSE.   

The top gainers on the Sensex were Wipro up by 2.89%, Hindalco Inds up by 2.72%, Tata Steel up by 2.37%, SSLT up by 2.25% and SBI up by 1.73%. On the flip side, ONGC down by 1.35%, Sun Pharma down by 0.85%, RIL down by 0.74%, ITC down by 0.63% and Hero Motocorp down by 0.61%.

Meanwhile, foreign direct investment (FDI) in India grew marginally by 1.5 percent to $2.18 billion in the month of January as compared to $2.15 billion in the same month of previous year. However, during the April-January FY14, FDI dipped by 2 percent to $18.74 billion from $19.1 billion recorded in the corresponding period of the previous fiscal.

The sectors that received highest inflows during the first ten month of current fiscal include services ($1.80 billion), pharmaceuticals ($1.26 billion), automobiles ($1 billion) and construction development ($966 million). Country wise, maximum FDI during the reported period was received form Mauritius with $4.11 billion followed by Singapore ($3.67 billion), UK ($3.18 billion) and Netherlands ($1.7 billion).

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. Now, it has started exercise for allowing FDI in railways and defence sectors. Despite the government various efforts to increase FDI, foreign investment during April-January FY14 has declined, which reflects the need to take more measures to improve the business environment in the country. Furthermore, India would require around $1 trillion in the 12th five year plan (2012-2017), to overhaul its infrastructure sector such as ports, airports and highways to boost growth.

The CNX Nifty is currently trading at 6,500.70 up by 17.60 points or 0.27% after trading in a range of 6,522.90 and 6,485.70. There were only 35 stocks advancing against 15 declining on the index.

The top gainers of the Nifty were Power Grid up by 3.12%, Hindalco up by 2.63%, Wipro up by 2.63%, SSLT up by 2.40% and Tata Steel up by 2.30%. On the flip side, ONGC down by 1.57%, Sun Pharma down by 0.98%, Asian Paints down by 0.90%, Reliance down by 0.76% and BPCL down by 0.72% were the major losers on the index.

Asian equity indices were trading mixed; Hang Seng up by 0.82% to 21,356.02, Shanghai Composite up by 2.07% to 2,034.85, Straits Times was up by 0.98% to 3,087.91. On the flip side, Jakarta Composite down by 0.10% to 4,694.58, Nikkei 225 down by 1.65% to 14,224.23 and Taiwan Weighted was down by 0.23% to 8,577.17.