Benchmarks trade positive tracking supportive global cues

The benchmarks are trading on a firm note in early trade tracking supportive global cues. The US markets closed higher on Friday, after the non-farm payroll data came better than expected, while today all the Asian peers barring Seoul Composite were trading in the positive terrain at this point of time, indicating strong investors' confidence. Back home, sustained buying by foreign funds and retail investors in fundamentally strong shares kept the momentum on the positive side. Software witnessed the maximum gain in trade followed by technology and public sector undertaking while; realty remained the lone loser on the BSE sectoral space. However, high crude oil prices continue to worry investors. Meanwhile, PSU oil marketing companies viz., BPCL, HPCL and IOC all were trading on the lower side in the trade on account of rise in crude oil prices. The broader indices were outperforming benchmarks and the market breadth on the BSE was positive; there were 1,307 shares on the gaining side against 383 shares on the losing side while 52 shares remained unchanged.

The BSE Sensex opened at 19,473.93; about 53 points higher compared to its previous closing of 19,420.39, and has touched a high of 19,566.29 while low remain its opening.

The index is currently trading at 19,517.27, up by 96.88 points or 0.50%. There were 20 stocks advancing against 10 declines on the index.

The overall market breadth has made a strong start with 75.03% stocks advancing against 21.99% declines. The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices surged 0.71% and 1.08% respectively. 

The top gaining sectoral indices on the BSE were, IT up by 1.60%, TECk up by 1.22%, PSU up by 0.84%, Bankex up by 0.82% and Metal was up by 0.52% while, Realty down by 0.02% were the lone loser on the index.

The top gainers on the Sensex were Hero Honda up by 1.94%, Wipro up by 1.87%, Infosys up by 1.77%, TCS up by 1.48% and SBI was up by 1.13%.

On the flip side, RCom down by 2.78%, Reliance Infra down by 1.14%, Maruti Suzuki down by 0.97%, HUL down by 0.79% and HDFC down by 0.62% were the top losers on the index.

Meanwhile, as the supply-demand dynamics in global edible oil market begin changing, Indian edible oil producers apprehend significant decline in price of commodity going forward. Global edible oil prices have already corrected 10-15% and the correction is very much set to transmit into the Indian markets as well. Further correction in global markets is expected after new crop comes into markets.

India is the largest importer of edible oils in world and imports close to 50% of its total domestic consumption. After some tight demand supply scenario seen in early part of current season, global markets have seen significant improvement in supply side that has eased prices in international markets. Since India imports nearly half of its edible oil use, the change in global prices is obvious to impact the domestic selling prices as well.

There are already clear signs of significant improvement in domestic product scenario. Country's Rabi oilseeds crop in the current season is expected to reach 9.87 million tonne compared with a harvest of 9.07 million tonne in the last season. On a full crop year basis, overall oilseeds production is expected to increase to 25.4 million tonne compared with 22.8 million tonne in the previous year. This will also ease domestic supply.

Similarly, global production is also expected to show significant increase owing to strong prices season in the previous season. This will improve overall global supply scenario. While demand is also expected to increase, it will fail to match the sharp price-generated increment in supply. Economists however expect that after initial fall, prices may recover partially again as in an absolute sense the demand will continue to remain strong.

India is one of the leading players in the world edible oil market, being the top most importer and the third-largest consumer (after China and the EU). Palm oil (mainly imported) and soya bean oil account for almost half of total edible oil consumption in India, followed by mustard and groundnut oil. However, as local production has failed to match rise in demand from a low per-capita levels, imports have been surging in recent years. In this wake, prices in the domestic markets are getting increasingly aligned with the international scenario.

The S&P CNX Nifty opened at 5,842.00; about 16 points higher compared to its previous closing of 5,826.05, and has touched a high and a low of 5,867.50 and 5,840.75 respectively.

The index is currently trading at 5,849.20, higher by 23.15 points or 0.40%. There were 30 stocks advancing against 20 declines on the index.

The top gainers of the Nifty were Hero Honda up by 1.88%, HCL Tech up by 1.86%, Wipro up by 1.61%, Infosys up by 1.61% and IDFC up by 1.47%.

RCom down by 3.45%, Reliance Infra down by 1.52%, HUL down by 1.23%, BHEL down by 1.17% and Sesa Goa was down by 1.12%, were the major losers on the index.

Asian markets were trading mostly in the green; Shanghai Composite was up 38.89 points or 1.33% to 2,967.00, Hang Seng was up 259.37 points or 1.09% to 24,061.27, Jakarta Composite was up 3.77 points or 0.10% to 3,711.26, KLSE Composite was up 1.29 points or 0.08% to 1,556.67, Nikkei 225 was up 54.70 points or 0.56% to 9,763.09 and Straits Times was up 10.15 points or 0.33% to 3,130.62.

On the flip side, Seoul Composite was down 12.51 points or 0.59% to 2,108.50.

 

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