After trading below the dotted line during post noon trading session, the Indian equity markets gathered steam in late hours and ended the day in the green. While the BSE-Sensex today closed higher by 125 points, the NSE-Nifty closed higher by 35 points. However, Midcaps and Smallcaps bucked broader market trend and closed flat. While the BSE Mid Cap index decreased by 0.2%, the BSE Small Cap index recorded gains of 0.3%. IT and metals stocks were the biggest gainers today.
As regards global markets, Asian indices closed on a strong note today. Only Japanese and Korean markets closed in the red. The rupee was trading at Rs 60.09 to the dollar at the time of writing.
In a step that would open doors for further foreign investment, the cabinet approved 49% investment in insurance companies. With Cabinet giving a nod to increase FDI the matter will now be taken up in the parliament. It may be noted that the FM had stated in his budget speech the need to increase foreign investment limit in this cash starved sector. A hike in limit would enable domestic companies to get the much needed capital from abroad. The move gives a much needed relief to the insurance sector which had proposed to raise the limit since 2008. It would be interesting to see how things pan out with increased availability of funds in the sector.
Mining stocks have closed the day on a mixed note, with Ashapura Minechem on top of the gainers list and MOIL on the losing side. As per a leading business daily, Coal India may face a production loss of 10 m tonnes in financial year 2015. This is because about 122 of its employees which were sacked for indiscipline have extended their agitation. This will lead to interim closure of a few crucial mines, leading to a fall in the company's output during the year. With indications that these employees are backed by local politicians, it may take a while for the agitation to reach resolution. Such a fall in production will be a negative not just for the company but also the power sector which is already reeling under a multitude of problems related to coal availability.