Sensex, Nifty may continue to head higher: Monday Closing Report

If the Nifty manages to make a higher high and stay above 5,555, it may see some more gains

The market closed in the positive on better-than-expected inflation numbers that raised hopes of the RBI cutting key interest rates, going ahead and a rally in oil & gas stocks following a decline in global crude prices. If the Nifty manages to make a higher high and stay above 5,555, it may see some more gains. The National Stock Exchange (NSE) recorded a volume of 52.20 crore shares and advance-decline ratio of 686:598.
The market opened in the negative no cautiousness ahead of the release of headline inflation numbers for March and weak cues from the Asian markets. Markets across were lower in morning trade on lower-than-expected growth data from China. Chinese GDP data recorded a 7.7% growth for the first quarter of 2013, below analysts’ expectations of 8% level and down from 7.9% in the previous quarter.
The Nifty opened 20 points down at 5,509 and the Sensex fell 47 points to resume trade at 18,196. Profit booking at the open led the benchmarks to their lows in initial trade itself. The Nifty fell to 5,500 and the Sensex slipped to 18,144 at their respective lows.
However, select buying saw the indices moving gradually higher as trade progressed. The benchmarks emerged into the positive in mid-morning trade on support from oil & gas stocks following a decline in global crude prices.
Lower-than-expected headline inflation for March coming in at a 40-month low of 5.96% pushed rate-sensitive sectors like banking, auto and infrastructure higher in late-morning trade. 
The market continued its northbound journey in noon trade on sustained buying activity. The benchmarks hit their highs at around 1.30pm with the Nifty rising to 5,593 and the Sensex climbing to 18,424.
A minor bout of profit booking saw the market paring part of its gains and remaining range-bound, albeit in the positive terrain. The market settled in the green on hopes that the decline in headline inflation will prompt the Reserve Bank of India to cut key rates, going ahead.
The Nifty rose 40 points (0.72%) to settle at 5,568 and the Sensex closed the session at 18,358, up 115 points (0.63%).
While the broader indices also ended higher, they underperformed the Sensex today, as the BSE Mid-cap index rose 0.15% and the BSE Small-cap index gained 0.43%.
The top sectoral gainers were BSE Oil & Gas (up 2.37%); BSE Fast Moving Consumer Goods (up 1.45%); BSE PSU (up 1.38%); BSE Bankex (up 0.96%) and BSE Capital Goods (up 0.57%). The main losers were BSE Consumer Durables (down 2.06%); BSE Metal (down 1.21%); BSE Auto (down 0.98%); BSE Healthcare (down 0.77%) and BSE Power (down 0.55%).
Fifteen of the 30 stocks on the Sensex closed in the positive. The chief gainers were ONGC (up 3.45%); State Bank of India (up 3.01%); Bharti Airtel (up 2.38%); Reliance Industries (up 2.35%) and ITC (up 2.34%). The top losers were Dr Reddy’s Laboratories (down 2.65%); Sterlite Industries (down 2.60%); TCS (down 2.38%); Tata Motors (down 2.25%) and Coal India (down 1.83%).
The top two A Group gainers on the BSE were—Jet Airways India (up 5.59%) and Canara Bank (up 5.51%).
The top two A Group losers on the BSE were—Muthoot Finance (down 13.13%) and Bajaj Holdings & Investment (down 6.79%).
The top two B Group gainers on the BSE were—Kama Holdings (up 20%) and Delta Corp (up 20%).
The top two B Group losers on the BSE were—Shimoga Technologies (down 20%) and BDH Industries (down 19.90%).
Of the 50 stocks on the Nifty, 25 ended in the green. The key gainers were BPCL (up 5.36%); Bank of Baroda (up 3.14%); ONGC (up 3.08%); Punjab National Bank (up 2.87%) and SBI (up 2.80%). The key losers were Sesa Goa (down 3.31%); Dr Reddy’s (down 2.80%); TCS (down 2.56%); DLF (down 2.53%) and Tata Motors (down 2.33%).
Markets in Asia closed lower on lower-than-expected GDP numbers from China for the fist quarter of the calendar year 2013. A decline in copper and crude prices impacted raw material producers and energy majors across the region.
The Shanghai Composite declined 1.13%, the Hang Seng dropped 1.43%; the Jakarta Composite declined 0.86%; the KLSE Composite slipped 0.04%; the Nikkei 225 tanked 1.55%; the Straits Times contracted 0.30%; the Seoul Composite fell 0.205 and the Taiwan Weighted settled 0.74% lower.
At the time of writing, the key European indices were trading with cuts of around 1% and the US stock futures were in the red, indicating a lower opening for US stocks later in the day.
Back home, institutional investors, both foreign and domestic, were net sellers in the equities segment on Friday. While foreign institutional investors pulled out funds amounting to Rs21.59 crore, domestic institutional investors withdrew Rs311.92 crore from stocks on Friday. 
Leading jewellery retailer Gitanjali Group plans to set up a total of 550 shops in India and abroad by end of this year, a top company official said. The expansion in the domestic market will be through a franchise route in Tier II and III cities as rents are lower than the Tier I cities. Gitanjali Gems declined 2.98% to close at Rs588.95 on the NSE.
Kalpataru Power Transmission 's subsidiary Shree Shubham Logistics has raised Rs80 crore from Tano India Private Equity Fund II for funding its capacity expansion plan. 
Post stake sale Kalpataru Power will hold 70% stake in the subsidiary. Kalpataru Power Transmission advanced 3.13% to close at Rs80.85 on the NSE.
Ahmedabad-based ice-cream maker Vadilal Industries is looking at East India for market expansion as it eyes 25 percent revenue growth in the current fiscal. The company, that sells brands like Flingo, Gourmet and Badabite currently, will also be launching more SKUs (stock keeping units) under these brands to enhance their equity. The stock surged 4.19% to close at Rs171.40 on the NSE.


Coal India directed to sign pacts with power cos even without PPA

In December last year, the PMO had directed power producers to sign FSAs with CIL in a month’s time. However, NTPC has refused to sign FSA, saying CIL was supplying poor quality coal

The Union coal ministry has directed Coal India (CIL) to sign fuel supply pacts with power generation companies, including NTPC, before finalising power purchase agreements with them.


“The Coal Ministry has directed Coal India (CIL) to sign Fuel Supply Agreement (FSA) with power companies, including NTPC, without waiting for PPAs (power purchase agreements),” according to a source.


In December last year, the Prime Minister’s Office had directed power producers to sign FSAs with CIL in a month’s time.


So far, 60 power companies have signed FSAs while many have not signed citing varied reasons.


India’s largest power producer NTPC has refused to sign FSA, saying CIL was supplying poor quality coal.


NTPC chairman and managing director Arup Roy Choudhury had said it had agreed on almost all terms and conditions of the FSA and is ready to sign the agreements provided CIL promised to give a minimum calorific value coal.


NTPC power plants need coal of minimum 3,100 kilocalories, but CIL at times had supplied coal with average heat generating capacity of about 2,100 kilocalories, according to the power company.


NTPC buys close to 140 million tonnes of coal to fire its thermal power plants. The company has not signed FSAs for 4,500 MW power generation capacity.


Driving is a necessary skill which must be improved in the city of Mumbai, says HPC

To improve the technology in use for driving tests, necessary hardware such as simulators will  be  installed  at the three  RTO offices  on a  pilot basis,  and  will be eventually installed at all RTO offices, says the HPC report

While the city of Mumbai is working towards better infrastructure and superior vehicles on the roads to have more orderly traffic, it is important to observe that driving is a necessary skill which must be improved in the city of Mumbai through improved quality driving test, says  a report by High Powered Committee (HPC) appointed by the Home ministry.


A public interest litigation (PIL-18/2010) was filed in the Bombay High Court by the Bombay Bar Association, dated 29 January 2010. This PIL primarily addresses various issues of traffic management in the city of Mumbai. The petition is regarding improper regulation of traffic, several issues related to traffic operations, technology, enforcement, manpower, road markings, etc. In the 17 hearings held by the high court, several issues related to enforcement and infrastructure was raised. The high court held a chamber hearing of all agencies on 7 May 2012 where in everyone was asked to put forth their views.  Subsequently,  to  look  into  these issues,  the  high  court  directed  that  a  High  Power  Committee (HPC)  be appointed. This article is based on the HPC report.


Improving Quality of Driving Test: In order to ensure that the quality of

driving  test  conducted  by  the  Transport  Department  is  improved,  necessary

infrastructure  to  conduct  proper  driving  test  as  per  the  provisions  of  Rule  15  of Central Motor Vehicle Rules (CMVR), 1989, such as the test tracks to test the driving skills of the drivers, will be provided. Provision of such infrastructure in Mumbai only will not suffice as the drivers from all over the state and even from outside the state drive the vehicles on Mumbai roads. Improvements are needed state-wide, according to the HPC report.


Action proposed: Providing infrastructural facilities like test tracks etc. throughout the state for better quality of driving test as per Rule 15 of CMVR, 1989. This must be completed in a time frame of four years.


Modern Technology for Driving Test: Use of modern equipment such as driving simulators is being considered to assess the driving skills and relevant behavioural aspects of a candidate in different situations by simulating the scenes. Presently, the provisions of the Motor Vehicles Act, 1988, do not provide for the use of simulators in assessment of the driving skills. 


Action proposed: Government of Maharashtra may consider sending the proposal to MORTH (ministry of road transport & highways) and to further follow up for amendments to Motor Vehicles Act & Rules. Once the proposal for amendment is submitted and approved, necessary hardware such  as simulators will  be  installed  at the three RTO offices  on a  pilot basis  and  will be eventually installed at all RTO offices. This must be completed in a time frame of three years.


Capacity  Building  in  RTOs  for  Driving  Tests: Sufficient  number  of  the technically qualified and properly trained personnel to utilize the modern systems and tools to make accurate assessment and evaluation of the driving skills of the applicants appearing for driver’s license test also needs to be made available to the department as a part of the policy to improve the quality of drivers. Such measures shall help reduce accidents and ensure better compliance of the traffic rules.


Action proposed: Central Institute of Road Transport (CIRT) to develop suitable training courses for officers conducting driving tests. Additional manpower is needed in the cadre of IMV/AIMV. This must be completed in a time frame of three years.


Refresher Training for Drivers: The Motor Vehicles Act does not provide for a efresher training to the driver, once a driving license is obtained. 


Action proposed: Transport Commissioner’s Office to send a proposal to the government for amendment  in  Motor  Vehicles  Act  for  introduction  of  the  concept  of  refresher training  for  drivers  and  further  test  of  driving  skills  and  behavioural  aspects  for commercial vehicle drivers. Appropriate policy changes are being recommended to make the drivers undergo a refresher training and further test of their skills and relevant behavioural aspects periodically. This must be completed in a time frame of three years.


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