Nifty holds 9,050; Sun Pharma up 10%, Hindalco down 3%

The Sensex was 231 points higher at 29,824 levels, while the CNX Nifty gained 58 points to 9,055 levels

Benchmark indices are trading firm in a tight range led by pharma, FMCG and rate-sensitive shares after the Reserve Bank of India (RBI) surprised the street with a repo rate cut of 25 bps (basis points) to 7.5% from 7.75%.

At 12:58, the S&P BSE Sensex was 231 points higher at 29,824 levels, while the CNX Nifty gained 58 points to 9,055 levels.

Shares of Sun Pharmaceutical Industries and Sun Pharma Advanced Research Company (SPARC) have touched their respective record high after SPARC announced that the U.S. Food and Drug Administration (FDA) have approved its new drug application (NDA) for ELEPSIA XR (Levetiracetam extended-release tablets 1000 mg and 1500 mg). Sun Pharma is up 10%.

Other notable gainers are ITC, Bharti Airtel, HDFC, ICICI Bank and Tata Motors.

Among losers, Hindalco, Coal India, Tata Power, Wipro and GAIL are down 1-3%.

Government today began the second round of coal mine auctions by putting on offer four blocks - all in Jharkhand - with firms including Adani Power, JSW Steel, SAIL and BALCO in the race.

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Updated at 12:07

Benchmark indices have trimmed gains after hitting record high levels in early trades after RBI’s Raghuram Rajan brought down its key policy rate by 25 basis points.

At 12.07 PM, the S&P BSE Sensex is 132 points higher at 29,726 levels, while the CNX Nifty has gained 31 points to 9,027 levels. Sensex and Nifty hit their record high levels of 30,025 and 9,119, respectively in the intra-day trades.

The top gainers on the Sensex are Sun Pharma, Bharti Airtel, ICICI Bank, HDFC and Tata Motors.

On the losing side, Hindalco, Coal India, Tata Power, Sesa Sterlite and Axis Bank have fallen between 1-3%.  

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Updated at 11:25

Markets continue to trade firm in the late morning trades after Reserve Bank of India governor Raghuram Rajan on Wednesday brought down its key policy rate by 25 basis points citing that it was convinced by the fiscal consolidation measures announced in the Budget. 

However, the RBI kept the cash reserve ratio (CRR) of scheduled banks unchanged at 4 per cent of net demand and time liabilities

At 11.25 AM, the S&P BSE Sensex is 281 points higher at 29,876 levels, while the CNX Nifty has gained 74 points to 9,070 levels. Sensex and Nifty hit their record high levels of 30,025 and 9,119, respectively in the intra-day trades.

STOCK IMPACT

Banking shares are in demand after RBI cut the repo rate by 25 bps to 7.5% today. Punjab National Bank, Bank of Baroda, Kotak Mahindra Bank, Canara Bank, Bank of India, Axis Bank, ICICI Bank, HDFC Bank and State Bank of India are up between 0.5-3%.

The surprise move will allow banks to deduct interest rates on home and car loans hence benefitting the Auto and Realty sector. Realty shares such as NBCC, India Bulls Realty, Unitech, DLF, HDIL, Anantraj are up between 2-8%. Meanwhile, from the auto segment, Tata Motors, Motherson Sumi, Hero Motocorp, M&M, Bajaj Auto, Maruti Suzuki have gained up to 2%. 

Apart from the interest rate cut, the gains from higher order flows will be bigger for construction companies given the government's focus on adding new infrastructure. Infrastructure companies like GMR infra, GVK, Gammon, Sadbhav Engineering have surged between 1-4%  on the BSE.

SPECTRUM AUCTION

The biggest ever auction of spectrum by the Department of Telecommunications (DoT) started on Wednesday in the morning where government expects to garner Rs 80,000-1lakh crore from the sale of spectrum.

Eight telecom operators are in fray for buying spectrum in 800, 900, 1800 and 2100MHz band.It is a do-or-die situation for telcos in many circles for incumbent operators — Idea Cellular, Vodafone, Reliance Communications and Bharti Airtel — which will be slugging out to retain their 900-MHz as their licences approach expiry. Idea Cellular, Reliance Communication and Bharti Airtel are surging higher up to 5%.

SMART RALLY

Sun Pharma is up 5.4% on reports that it will acquire the opiates business of GlaxoSmithKline (GSK) in Australia. Among its peers, Cipla and Dr Reddy’s Lab have gained between 1-1.5%.

Shares of Eicher Motors are trading higher by 2% at Rs 16,226, bouncing back 7.4% from its intra-day low touched in early morning trade after a huge block deal executed on the counter on BSE. The stock opened at Rs 15,301 and touched a low of Rs 15,111 on BSE.

Shares of companies engaged in marine port and services business are in focus and rallied by up to 18% in early morning trade on back of heavy volumes.

Essar Ports, Gujarat Pipavav Port and Adani Port and Special Economic Zone (SEZ) have rallied between 4-18% on the Bombay Stock Exchange (BSE).

Coal India continues its yesterday’s fall and has dipped 1% in today’s trade after the stock turned ex-dividend for Rs 20.70 per share yesterday.

Other notable losers include Hindalco, Tata Power, GAIL and Wipro down up to 1%.

On the macroeconomic front, the HSBC services PMI rose to an eight-month high of 53.9 in February up from 52.4 in January indicating strong expansion in output across the sector.

However, the broader markets are underperforming the benchmark indices- BSE Midcap and Smallcap indices are up 0.5% each. Markets breadth is positive with 1,376 advances and 1,094 declines.