Market yet again shifts gear; bounces back in green albeit with slender gains

Yet again reversing gears, local barometer gauges have now bounced back into positive terrain, albeit with slender gains on lower level buying by select market-participants after Narendra Modi was elected as leader of BJP Parliamentary Party by its Veteran BJP leader LK Advani. Off day’s low, both Sensex and Nifty were trading flat, above the crucial 24350 and 7250 levels respectively. Meanwhile, broader indices also adding ground were trading with hefty gains of over a percent.  Recovery at Dalal Street was led by massive gains of stocks from Realty, Consumer Durables and Technology counters, however further gains were restricted by losses in stocks from Oil & Gas, Public Sector Undertaking and banking counters.

Meanwhile, somber global cues too might cap bourses’ gain going further in the day. On the global front, receiving negative handover from Asian counter parts, European shares got off to a slightly weaker start on Tuesday on account of geo-political concerns. On the geopolitical front, Thailand's army declared martial law nationwide on Tuesday to restore order after six months of street protests that have left the country without a proper functioning government, but denied that the surprise move amounted to a military coup.

The BSE Sensex is currently trading at 24363.23, up by 0.18 points after trading in a range of 24,587.16 and 24,299.53. There were 18 stocks advancing against 12 stocks declining on the index. The overall market breadth on BSE continued to remain in the favour of advances which thumped declines in the ratio of 1803:776; while 95 shares remained unchanged.

The broader indices too added ground; the BSE Mid cap index was up by 1.69%, while Small cap index up by 2.49%.

The gaining sectoral indices on the BSE were Realty up by 4.31%, Consumer Durables up by 2.52%, Teck up by 1.60%, IT up by 1.59%, and Healthcare up by 1.58%. On the flip side, Oil and Gas down by 2.71%, PSU down by 1.52%, Bankex down by 0.63%, Auto down by 0.23% and Capital Goods down by 0.18% were the losing indices on BSE.   

The top gainers on the Sensex were Tata Steel up by 3.83%, SSLT up by 3.76%, Hindalco Industries up by 3.32%, Dr Reddy’s Lab up by 2.71% and HDFC up by 2.67%. On the flip side, Coal India down by 4.85%, Hero Motocorp down by 3.32%, RIL down by 3.05%, ONGC down by 2.95% and Gail India down by 2.20% were the top losers on the index.

Meanwhile, industry body FICCI has highlighted low inflation and a positive business environment as the top supportive factors for India to get back to high growth path. The FICCI‘s president Sidharth Birla has said that country needs to create investor confidence by revitalizing domestic investors and strengthening governance, policy certainty and capital friendliness.

Sidharth Birla further asserted that India also needs to implement GST by 2015 and revisit subsidies and revamp the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA). Industry body also recommended measures to improve the tax environment in the country include resolve retrospective/ capital raising tax-related issues and rebate income tax for small start-up businesses. Regarding the land acquisition issue, the FICCI highlighted the need for a comprehensive review of the Land Acquisition Act urgently.

At present, Indian economy is struggling with slowdown and its growth slowed down to a decade low at 4.5 percent in FY13 and 4.6 percent during the first three quarter of FY14. High inflation, unfavorable tax environment and land procurement and environment clearances issues have been impacting the business sentiments in the country. Prevailing high inflation has impacted the purchasing power of consumer, whereas land and environment clearance issues have stalled the development of big infrastructure projects. 

The CNX Nifty is currently trading at 7,269.05, up by 5.50 points or 0.08% after trading in a range of 7,353.65 and 7,247.70. There were 29 stocks advancing against 21 declining on the index.

The top gainers of the Nifty were Tata Steel up by 4.09%, SSLT up by 3.53%, Hindalco up by 3.29%, Lupin up by 2.92% and Infosys up by 2.65%. On the flip side, Coal India down by 4.86%, Hero Motocorp down by 3.62%, BPCL down by 3.17%, ONGC down by 3.06% and Reliance down by 2.85% were the major losers on the index.

Asian equity indices were trading in red, with exception being Hang Seng up by 0.45%, Straits Times up by 0.02%, and Nikkei 225 up by 0.49%. On the flip side, Shanghai Composite declined by 0.02%, Jakarta Index plunged by 2.37% and Taiwan Weighted dropped by 0.14% were the losers among Asian pack.

European shares got off to a negative start; with United Kingdom’s FTSE 100 declining by 0.01%, France’s CAC 40 index dropping 0.11% while, Germany’s Dax rising by 0.02%