Post Session: Quick Review

Indian equity markets vaulted around massive 3% and scaled fresh record highs on hopes that opposition Bharatiya Janata Party (BJP) would will either win or come close to an outright majority on conclusion of five-week-long general elections, whose results are set to be unveiled on May 16, 2014. Aggressive bets which were built ahead of exit polls slated to be announced by various media organizations on Monday evening, mainly led Sensex end just shy of the crucial 23,000 level and Nifty past the psychological 6850 levels respectively. Meanwhile, broader indices too participating into the rally, settled with gains in the range of 0.75%-1.50%.

On the global front, most of the Asian pacific shares, rebounding from their largest drop in almost seven weeks, settled higher as Chinese trade unexpectedly climbed and Janet Yellen said the Federal Reserve will continue to support the US economy. Meanwhile, European shares slipped back as disappointing business updates from leading companies such as telecoms operator Tele-fonica sobered the mood after a rally on the previous day.

Closer home, in the extremely buoyant session of trade, benchmark equity indices after getting a flat but positive start, went on steadily gaining ground and halted only at day’s high by close of trade. In the extremely energetic session of trade, majority of the sectoral indices on BSE settled in positive terrain, with only exceptions being Healthcare and Consumer Durable counters. On the flip side, prominent gainers were the stocks belonging to Banking, Realty and Capital Goods (CG) counters. Meanwhile, metal stocks gained, with both Hindalco Industries and Tata Steel gaining 0.53% on hopes for revival in Chinese demand. The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1587: 1167, while 139 scrips remained unchanged. (Provisional)

The BSE Sensex gained 650.19 points or 2.91% to settle at 22994.23. The index touched a high and a low of 23048.49 and 22317.18 respectively. Among the 30-share Sensex, 17 stocks gained, while 13 stocks declined. (Provisional)

The broader indices were ended in green; the BSE Mid cap index was up by 1.47% and Small cap index up by 0.72%.(Provisional)

On the BSE Sectoral front, Bankex up by 5.34%, Realty up by 4.38%, Power up by 4.12%, PSU up by 3.57% and Oil & Gas up by 3.44% were the major gainers while, Health Care down by 0.56% and Consumer Durables down by 0.03% were the top losers in the space. (Provisional)

The top gainers on the Sensex were ICICI Bank up by 7.03%, Axis Bank up by 6.06%, HDFC Bank up by 5.56%, BHEL up by 5.32% and Hindalco Inds up by 5.20% while, Dr Reddys Lab down by 1.01%, Sun Pharma down by 0.09% and TCS down by 0.06% were the top losers in the index (Provisional).

Meanwhile, industry body Assocham in its latest report has stated that about 5 percent deficit rains due to possible El Nino factor could impact Indian economic growth by 1.75 percent (Rs 1,80,000 crore) in the current fiscal year. The report highlighted that as about 60 per cent of net sown area of the country is rain-fed, the deficiency in rains could have a significant bearing on India’s agriculture sector and will raise food inflation in the country. Besides, below normal rains can also affect lakhs of unskilled jobs in India. Agriculture sector represent around 15 percent share in the country GDP and provides employment to large number of people in the country.

Assocham report highlighted that India must have good agricultural performance, as a rise in farm sector is estimated to lift demand for industrial goods and services. It mentioned that about 30 per cent of the manufacturing sector is agriculture-based and a bumper crop ensures the supply of raw material for industry at relatively lower prices.

India is expected to witness below normal monsoon this year with met department forecasting 95 per cent rainfall because of the El-Nino effect. Meanwhile, the industry body has submitted a report to government which suggests a 12-point strategy in order to contain drought-like situation in country. Industry chamber stated that government must expand the farm insurance cover, advise financial institutions to settle crop insurance claims and distribute high quality seeds of alternate crops in drought-hit areas without delay. Further, Assocham suggested the government to bring down the cereal inflation by liquidating the extra stock and keep minimum support price (MSP) attractive for alternative crops to be cultivated in drought-hit areas. Moreover, Assocham also recommended measures like scrapping of the APMC Act, fuel subsidy to farmers to protect standing crops and free flow of agriculture goods across states to bridge demand- supply gap among others.

India VIX, a gauge for markets short term volatility expectation gained 9.92% at 37.70 from its previous close of 34.30 on Thursday. (Provisional)

The CNX Nifty gained 198.95 points or 2.99% to settle at 6,858.80. The index touched high and low of 6,871.35 and 6,652.15 respectively. Out of 50 stocks in Nifty, 46 stocks ended in the green and 3 in red while 1 remained unchanged.

The major gainers of the Nifty were IDFC up 8.25%, ICICI Bank up by 7.21%, Ambuja Cement up by 6.76%, Axis Bank up by 6.19% and Tata Power up by 5.70%.  The key losers were Lupin down by 1.48%, Dr Reddy down by 0.99% and NMDC down by 0.03%. (Provisional)

European markets were trading in red; France’s CAC 40 was down by 0.63%, UK’s FTSE 100 was down by 0.42% and Germany’s DAX was down by 0.51%.