Benchmarks add gains; Nifty above 6800 mark

Indian equity benchmarks added gains to continue their firm trade hovering near the highest point of the day in the late afternoon session on account of buying in frontline blue chip counters. The market sentiment was on optimistic note after data showed that foreign funds remained net buyers of Indian stocks on Thursday i.e. May 08, 2014. As per provisional data from the stock exchanges foreign institutional investors (FIIs) bought shares worth a net Rs 363.24 crore. The sentiments also got boost on hopes that opposition Bharatiya Janata Party would win a majority in elections which is set to conclude next week. Traders were seen piling up positions in Bankex, Realty and Power stocks, while selling was witnessed in HealthCare sector stocks. In scrip specific development, Jet Airways was trading in green after market regulator SEBI stated that Abu Dhabi carrier Etihad does not have to make an open offer for the Indian company’s shareholders pursuant to the Rs 2,060 crore stake deal between them. Sintex Industries was trading firm after the textiles and plastic firm reported 6.75% increase in consolidated net profit at Rs 161.17 crore for the quarter ended March 31. On the global front, the Asian markets were trading mostly in green, while the European markets traded on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,800 and 22,900 levels respectively. The market breadth on BSE was positive in the ratio of 1491:1056 while 132 scrips remained unchanged. The BSE Sensex is currently trading at 22945.99, up by 601.95 points or 2.69% after trading in a range of 22959.33 and 22,317.18. There were 29 stocks advancing against 1 stocks declining on the index. The broader indices were trading in green; the BSE Mid cap index was up by 1.24%, while Small cap index up by 0.73%. The gaining sectoral indices on the BSE were Bankex up by 4.25%, Realty up by 3.68%, Power up by 3.34%, Metal up by 3.33% and Capital Goods up by 3.09% while, HealthCare down by 0.34% was the only losing index on BSE.    The top gainers on the Sensex were ICICI Bank up by 5.72%, Hindalco Industries up by 5.31%, Tata Power up by 4.72%, Coal India up by 4.62% and Tata Steel up by 4.24%. On the flip side, Dr Reddy’s Lab down by 0.68% was the sole losers on the index. Meanwhile, industry body Assocham in its latest report has stated that about 5 percent deficit rains due to possible El Nino factor could impact Indian economic growth by 1.75 percent (Rs 1,80,000 crore) in the current fiscal year. The report highlighted that as about 60 per cent of net sown area of the country is rain-fed, the deficiency in rains could have a significant bearing on India’s agriculture sector and will raise food inflation in the country. Besides, below normal rains can also affect lakhs of unskilled jobs in India. Agriculture sector represent around 15 percent share in the country GDP and provides employment to large number of people in the country. Assocham report highlighted that India must have good agricultural performance, as a rise in farm sector is estimated to lift demand for industrial goods and services. It mentioned that about 30 per cent of the manufacturing sector is agriculture-based and a bumper crop ensures the supply of raw material for industry at relatively lower prices. India is expected to witness below normal monsoon this year with met department forecasting 95 per cent rainfall because of the El-Nino effect. Meanwhile, the industry body has submitted a report to government which suggests a 12-point strategy in order to contain drought-like situation in country. Industry chamber stated that government must expand the farm insurance cover, advise financial institutions to settle crop insurance claims and distribute high quality seeds of alternate crops in drought-hit areas without delay. Further, Assocham suggested the government to bring down the cereal inflation by liquidating the extra stock and keep minimum support price (MSP) attractive for alternative crops to be cultivated in drought-hit areas. Moreover, Assocham also recommended measures like scrapping of the APMC Act, fuel subsidy to farmers to protect standing crops and free flow of agriculture goods across states to bridge demand- supply gap among others. The CNX Nifty is currently trading at 6,846.05, up by 186.20 points or 2.80% after trading in a range of 6,850.35 and 6,652.15. There were 47 stocks advancing against 3 declining on the index. The top gainers of the Nifty were Ambuja Cement up by 6.92%, ICICI Bank up by 5.77%, IDFC up by 5.76%, ACC up by 5.38% and Hindalco Industries up by 5.23%. On the flip side, Lupin down by 1.08%, Dr. Reddy’s Lab down by 0.73% and Sun Pharma down by 0.07% were the only losers on the index. Asian equity indices were trading mostly in green; Hang Seng up by 0.12%, Nikkei 225 up by 0.25%, Straits Times was up by 0.05% and Jakarta Composite added 0.38%. While,  Shanghai Composite down by 0.21% and Taiwan Weighted declined by 0.46% were the losers among Asian pack. The European markets were trading in red; France’s CAC 40 was down 0.41%, Germany’s DAX dropped 0.26% and UK’s FTSE 100 lost 0.26%.