Benchmarks extend gains; trade near intra-day high levels

Indian bourses added gains to continue firm trade in the late afternoon session hovering near the highest point of the day on the back of strong buying witnessed in consumer durables, realty and metals stocks. The firm global cues coupled with the expectations that the new government will usher in strong pro-reform policies and kick-start the investment cycle has enthused the markets to extend their gains. Almost all sectoral indices were trading in green while a mild weakness in the defensive IT and Teck sectors was visible. Sentiments also got a boost as the UN report highlighted that Indian economy is likely to grow at 5 percent in 2014 and record a slightly higher expansion of 5.5 percent next year on the back of stronger consumption and investment. Apart from blue chips, broader indices too equally participated in the rally with both mid and small cap indices were trading up by over 2.00%. Consumer durable was the top gaining index on BSE up by around 6.38% followed by realty index trading up by around 4.33%. Jewellery stocks were also on the buying radar after the Reserve Bank had yesterday eased gold import norms. Coal India was trading up by around 7% to Rs 397 on reports that Prime Minister-elect Narendra Modi is exploring the possibility of splitting up the state-owned company and opening the sector to foreign investment to boost output and cut imports. Bajaj Auto was up nearly 3% to Rs 2,010 after the Egypt government lifted the ban on three-wheeler imports which was in effect since February. Kalindee Rail Nirman (Engineers) is locked at the lower circuit of 10% at Rs 122 after the company said its board approved the merger with Texmaco Rail & Engineering. On global front, major Asian equity indices were trading in green with Straits Times up by 0.04% and Nikkei 225 up by 2.16% as global investors sentiments got a boost after the US Federal Reserve's last meeting reassured investors that policy makers will continue to support the world's biggest economy. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 7,250 and 24,400 levels respectively. The market breadth on BSE was positive, out of 2,649 stocks traded, 2,046 stocks advanced, while 517 stocks declined on the BSE. The BSE Sensex is currently trading at 24,458.17 up by 160.15 points or 0.66% after trading in a range of 24,493.47 and 24,347.78. There were 17 stocks advancing against 13 stocks declining on the index. The broader indices were trading in green; the BSE Mid cap index was up by 2.20%, while Small cap index up by 2.33%. The gaining sectoral indices on the BSE were Consumer Durables up by 6.38%, Realtly up by 4.38%, Metal up by 2.77%, Power up by 1.97% and Auto up by 1.64%. On the flip side, Teck down by 0.33% and IT down by 0.23% were the losing indices on BSE.    The top gainers on the Sensex were Coal India up by 6.72%, Maruti Suzuki up by 4.54%, NTPC up by 3.67%, SSLT up by 3.39% and Bajaj Auto up by 2.60%. On the flip side, Bharti Airtel down by 1.81%, Hindalco Inds down by 1.32%, HDFC Bank down by 1.31%, Infosys down by 1.30% and Wipro down by 1.12%. Meanwhile, in order to enhance Indian exports, the Reserve Bank of India (RBI) has eased norms for loans to exporters. The RBI, in its notification, stated that the domestic exporters can now get long-term loans from banks for up to 10 years to service export contracts. Earlier the exporters were allowed to get loans up to one year. Further, the central bank notified that banks can make such payments to exporters with a satisfactory track record of three years and adjust these payments against future exports. However, banks cannot charge interest rates exceeding 200 basis points above LIBOR. Furthermore, exporters who receive loans of $100 million or above need to report the transaction immediately to the central bank, the notification added. During the financial year 2014, Indian exports shipments touched $312.35 billion, registering 3.98% growth over the previous fiscal year but remained below the set export target at $325 billion. India’s export has been hovering near $300 billion over the last three fiscal years and it has become imperative to boost country’s exports and enhance its contribution in the world trade. In India, Foreign Trade Policy (FTP) governs all exports and imports related activities and mainly aims at enhancing the country's exports. The five-year FTP (2009-14) ended on March 31 and the new government formed after the general elections will introduce new FTP for the period 2014-19 in June 2014. Meanwhile, new FTP is likely to promote exports of specific products in specific geographies and would also abolish conventional method of exports by focusing more on areas like branding of products in the global markets, exports of services and hi-tech products and new strategy for marketing. The CNX Nifty is currently trading at 7,295.05 up by 42.15 points or 0.58% after trading in a range of 7,306.50 and 7,258.15. There were 32 stocks advancing against 18 declining on the index. The top gainers of the Nifty were Coal India up by 7.04%, DLF up by 6.64%, Maruti Suzuki up by 4.28%, NTPC up by 3.71% and SSLT up by 3.51%. On the flip side, Infosys down by 1.51%, Bharti Airtel down by 1.47%, Hindalco Inds down by 1.35%, Wipro down by 1.33% and HDFC Bank down by 1.31% were the major losers on the index. Asian equity indices were trading in green; Straits Times up by 0.04% to 3,263.05, Nikkei 225 up by 2.16% to 14,345.72, Jakarta Index up by 1.05% to 4,961.74, Taiwan Weighted up by 1.21% to 8,969.63, Hang Seng up by 0.63% to 22,980.14 and Shanghai Composite up by 0.15% to 2,027.93