Post Session: Quick Review

Breaking out of consolidation mood, Indian equity markets resumed northbound journey and accumulated gains of close to quarter of a percent on Thursday. Bargain buying activities by market-participants on hopes of continued foreign buying in equities and debt after minutes of the US Federal Reserve's last meeting backed bets of a slower withdrawal of the stimulus, mainly buoying the sentiment at Dalal Street after last two sessions’ of consolidation. However, bit of profit-booking which took place in late hours dragged the markets from day’s high level, though recovery emerged thereon, but that turned out to be lackadaisical. By close of trade, both Sensex and Nifty settled past the crucial 24,350 and 7,250 levels respectively. Meanwhile, broader indices outperforming larger peers by fat margin for fourth straight session went home with gains in the range of 1.75%-2%.

On the global front, Japanese stocks led a surge in Asian equities to a one-year high on Thursday, after an upbeat reading on China's factory sector burnished risk appetite and blunted some of the more pessimistic views on the world's second-biggest economy. The HSBC Flash China Manufacturing Purchasing Managers' Index (PMI) recovered to 49.7 in May from April's final reading of 48.1. Meanwhile, European shares  were trading upbeat after an unexpected pickup in Europe's service industry was offset by underwhelming factory activity, but was enough to show that the euro zone's fragile recovery has some traction

Equities across the globe were on the front foot after minutes of the US Federal Reserve's last meeting reassured investors that policy makers will continue to support the economy.Closer home, majority of the sectoral indices on BSE ended in positive terrain, barring stocks from IT and Technology counters. On the flip side, stocks from Consumer Durables, Realty and Power counters were the top performers of the session. Meanwhile, shares of jewellery companies, including Titan Co, Gitanjali Gems, Tribhovandas Bhimji Zaveri and Shree Ganesh Jewellery House, hogged limelight in today’s trade after the Reserve Bank of India (RBI) eased gold import rules by allowing seven more private agencies to ship the precious metal.

In stock-specific activity, while Coal India rallied up to 5% on reports that Prime Minister-elect Narendra Modi was exploring the possibility of splitting up the state-owned company and opening the sector to foreign investment to boost output and cut imports, Maruti Suzuki surged 4% after Asia's leading equity broker, CLSA forecasted the stock price of Maruti to double in three years in a bull scenario, in which personal vehicle industry volume could grows at a compounded annual growth rate of 20% due to pent-up demand should the economic growth pick up. The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 2267:746, while 80 scrips remained unchanged. (Provisional)

The BSE Sensex gained 73.84 points or 0.30% to settle at 24371.86. The index touched a high and a low of 24524.76 and 24326.48 respectively. Among the 30-share Sensex, 16 stocks gained, while 14 stocks declined. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 2.23% and Small cap index was up by 2.55%. (Provisional)

On the BSE Sectoral front, Consumer Durables up by 6.90%, Realty up by 5.86%, Power up by 2.80%, PSU up by 1.98% and Metal up by 1.94% were the gainers while, TECK down by 0.57%, IT down by 0.41% and   Auto down by 0.07%, were the losers in the space. (Provisional)

The top gainers on the Sensex were NTPC up by 6.89%, Coal India up by 4.93%, SSLT up by 4.33%, Maruti Suzuki up by 4.31% and Tata Power up by 4.10% while, Bharti Airtel down by 2.60%, HDFC down by 2.51%, Hindalco Inds down by 2.51%, BHEL down by 2.29% and Wipro down by 1.94% were the top losers in the index (Provisional).

Meanwhile, in a move that will bring down prices of gold in the domestic market, especially in peak wedding season, the Reserve Bank of India (RBI) has eased gold import norms by allowing seven more private agencies for shipping precious metal, in addition to those already permitted banks. With this, gold imports by India, the world's No. 2 bullion consumer after China, could quickly rise from current levels as more than twenty entities, including state-run banks, private banks and agencies will now be allowed to import yellow metal.

In order to control burgeoning Current Account Deficit (CAD) and sliding rupee, the Reserve Bank of India (RBI) in July, 2013 had imposed severe restrictions on gold imports. The central bank had tied imports with exports and prescribed a 20:80 formula and the facility was only available to select banks.

However, with recent development, Star Trading Houses/Premier Trading Houses (STH/PTH), which are registered as nominated agencies by the Director General of Foreign Trade (DGFT), may now import gold under 20:80 scheme, which would imply that an importer has to ensure that at least one-fifth, or 20%, of every lot of imported gold is exclusively made available for the purpose of exports and the balance for domestic use.

In a separate development, RBI also allowed banks to grant gold loans to domestic jewellery makers, a practice that was stopped last year. In absence of gold loans, jewellers had been forced to take credit to fund purchases, which substantially added to their cost and pressurized their profit margins.  India VIX, a gauge for markets short term expectation lost 0.41% at 17.83 from its previous close of 17.91 on Wednesday. (Provisional)

The CNX Nifty gained 23.50 points or 0.32% to settle at 7,276.40. The index touched high and low of 7,319.55 and 7,258.15 respectively. Out of 50 stocks in Nifty, 25 stocks ended in the green and 25 in red.

The major gainers of the Nifty were DLF up 10.06%, NTPC up by 7.31%, Coal India up by 5.37%, SSLT up by 4.84% and Maruti up by 4.02%.  On the flip side, the key losers were Hindalco down by 2.57%,HDFC down by 2.17%, Bharti Airtel down by 2.15%, BHEL down by 2.10% and Wipro  down by 2.05%. (Provisional)

Most of European markets were trading in green; France’s CAC 40 was down by 0.20%, UK’s FTSE 100 was up by 0.06% and Germany’s DAX was up by 0.11%.

The Asian markets concluded Thursday’s trade mostly in green, following a positive reaction to the minutes of the Federal Reserve's April meeting. An index measuring manufacturing activity in Japan touched a two-month high, coming in at a seasonally adjusted score of 49.9 in May, that’s up from 49.4 in April, although it remains just below the mark of 50 that separates expansion from contraction. Moody’s Investors Service revised its outlook for China’s property market to negative from stable as it sees growth in home sales to slow notably, high inventory levels and weakening liquidity over the next 12 months. Separately, Shanghai expects a notable drop in new home supply in June as fewer residential projects will release units for sale. About 35 new residential developments, comprising 29 apartment projects and the rest villa developments, are set to launch locally next month, a monthly drop of 41.7% or an annual decline of 25.5%. China added 4.73 million jobs in the first four months of 2014, slightly more than the number created in the same period of last year. At the end of March, the country’s registered urban jobless rate was 4.08%. The rate was 0.03% higher than at the end of last year, but it was still considered to be a relatively low level.