Indian stock indices have managed to capitalize on the initial momentum and are trading at the session's high levels in the Monday afternoon trades as sentiments got fortified further following the encouraging European market opening. The European equities rejoiced on Fed Chairman Bernanke's optimistic view of the US economy as he was hopeful that the world's largest economy will gradually get better and that the Fed has more options to prop up growth. The BSE's thirty share sensitive index has sustained its northbound journey and has even gone on to re-conquer the psychological 16,300 levels rallying over four hundred fifty points thanks to the broad based short covering rallies across the sectoral space. The inflammation technology and rate sensitives which went through turbulent times in recent days are seeing huge position build-up in the session while the defensives like Heathcare and FMCG are not amongst the swiftest of gainers yet trading with around one and a quarter percent gains. Barring the two heavyweights like ONGC and Maruti Suzuki, all the components of the Sensex are trading in the green territory. Meanwhile, RBI has released a report on the Issues and concerns in the NBFC Sector in which the RBI panel has suggested to impose a risk weight of 150% for capital market loans and 125% for commercial real estate loans by such NBFCs. In another development, reports suggest that government is likely to announce a duty drawback scheme by next month-end to replace the Duty Entitlement Passbook scheme which is set to expire on September 30.
Moreover, the broader markets traded on an optimistic note in the afternoon trades, but failed to match the fervor displayed by their larger peers and traded with gains of around two percent. The bourses climbed on weak volumes given that these are the initial days of a new F&O series while the market breadth on BSE was dominantly favor of advances in the ratio of 1945:637 while 88 scrips remained unchanged.
The BSE Sensex is currently trading at 16,302.90 up by 454.07 points or 2.87% after trading as high as 16,309.33 and as low as 16,068.73. There were 28 stocks advancing against 2 declines on the index.
The broader indices were trading on a optimistic note; the BSE Mid cap index surged 1.99% and Small cap rose 1.66% respectively.
On the BSE sectoral space, IT up 4.71%, TECk up 3.97%, Bankex up 3.51%, Metal up 3.42% and Realty up 3.28% were the major gainers while there were no losers on the index.
Jindal Steel up 6.21%, TCS up 6.15%, Wipro up 4.31%, Infosys up 4.19% and Hindalco up 3.88% were the major gainers on the Sensex, while ONGC down by 0.83% and Maruti Suzuki down 0.81% were the major losers on the index.
Meanwhile, to enhance trade over the land routes, India and Bangladesh have taken the first major step by relaxing the present practice of unloading trucks at the zero border point. Trucks from both sides would now be allowed to enter 200 metres inside each other's territories. To reinforce trade at the Petropole-Benapole border in Bengal's North 24 Parganas district, Union Home Minister P Chidambaram laid the foundation stone for a new road there to ensure flawless traffic flow on the route, with state-of-the-art warehouses and modern parking facilities for heavy vehicles. The Petropole border is the largest land customs station in Asia.
The total cost of the project is around Rs 125 crore and State-run RITES is the advisor. This new stretch would be a bypass road on the present congested one, connecting Benapole to NH35, bypassing Bongaon, the last town in the India-Bangladesh border that is 97 km from Kolkata. This move by the government would ease overcrowding and allow trucks to move in a smoother fashion to the Bangladesh side and also to receive the traffic coming from there. It is also reported that both the sides were also discussing a Comprehensive Motor Vehicular Agreement, to encourage seamless cross-movement of cargo.
Development of the land trading route with the installation of proper security measures was on the main agenda discussed during the visit of Bangladeshi Prime Minister, Hasina, in January 2010. Both sides had agreed to comprehensively address all land boundary issues and announced creation of a Joint Boundary Working Group. The need of sufficient infrastructure in the trading routes across borders has resulted in major delays and cost overruns. Traffic congestions, delay in handling shipments and increasing storage-dwell times have been major non-tariff barriers for trade.
Earlier last month, Commerce, Industry and Textile Minister Anand Sharma and his Bangladeshi counterpart, Muhammad Faruk Khan, inaugurated 'Border Haats' at Kalaichar in the West Garo Hill district in Meghalaya. It is estimated that bilateral trade worth $20 million will take place annually from these Haats, which would re-establish the traditional system of marketing local produce.
The bilateral trade between India and Bangladesh has increased from $2.7 billion in 2009-10 to $3.9 billion in 2010-11, an increase of 45 percent. The growth of exports from Bangladesh to India has also increased from $0.25 billion in 2009-10 to $0.39 billion in 2010-11. In 2010, India offered a $1 billion line of credit to Bangladesh, the largest ever one-time bilateral financial assistance extended to any country by India.
The S&P CNX Nifty is currently trading at 4,880.35, higher by 132.55 points or 2.79% after trading as high as 4,883.85 and as low as 4,806.05. There were 45 stocks advancing against 5 declines on the index.
The top gainers of the Nifty were TCS up 6.23%, Jindal Steel up by 5.78%, HCL TECH up 5.29%, Kotak up 5.28%, and Infosys up 4.42%.
Maruti down 1.51%, Ranbaxy down 1.01%, ONGC down 0.88%, Ambuja Cement down 0.08% and Seas down 0.07% were the major losers on the index.
Asian markets traded on a positive note, Hang Seng added 1.36%, KLSE Composite rose 0.17%, Straits Times surged 1.56%, Nikkei 225 climbed 0.61%, Seoul Composite soared 2.84% and Taiwan Weighted amassed 1.79%.
On the other hand, Shanghai Composite eased 1.41%.
Meanwhile, the stock markets in Indonesia remained shut on Monday on account of the Idul Fitri holiday. The markets there will remain closed till September 2.
The European markets traded on optimistic note as France's CAC 40 surged 1.41% and Germany's DAX soared 1.52%.
Stock markets in London remained closed on Monday for summer holiday.
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