Indian equity benchmarks after opening on rousing note this morning, has moved further up north and currently trading near high point of the day following positive cues from Asian markets and on improved manufacturing data. Investors were on a buying spree on hopes of some monetary easing by the Reserve Bank of India. On sectoral front, mirroring widespread buying, all the sectoral indices were up in positive territory with strong gains. Metal, realty, information technology and bank stocks were among the top gainers. On the global front, markets in the Asia-Pacific region markets were trading in green on the back of some encouraging economic data from Germany. Back home, the market breadth remained positive.
The BSE Sensex is currently trading at 15826.09, up by 308.17 points or 1.99%. The index has a touched a high and low of 15842.97 and 15640.56 respectively. There were 29 stocks advancing against just 1 decline on the index.
The broader indices too were trading in green; the BSE Mid cap and Small cap indices jumped 1.71% and 1.75% respectively.
The top gainers on the index were Metal up 3.48%, Realty up 2.99%, Capital Goods up 2.55%, IT up 2.51% and PSU up 2.49% while there were no losers on the index.
The top gainers on the Sensex were Coal India up by 5.20%, Tata Steel up by 4.30%, DLF up 3.94%, Tata Motors up by 3.75% and Sterlite Industries up by 3.32%.
On the flip side, M&M down 1.48% was the only loser on the Sensex.
Meanwhile, India’s manufacturing activity showed some resilience in the month of December as it accelerated at a swift pace on the back of strong new work intakes and output growth. The expansion in manufacturing came in the face of continued contraction in most Asian nations and across the European region. However, upbeat domestic demand, new orders and increase in exports together helped in underpinning Indian PMI index to remain in the expansionary territory for 33 months in a row.
According to the HSBC purchasing managers’ index (PMI), the manufacturing sector expanded to 54.2 in December, as against 51 in the previous month of 2011. A figure above 50 signals increase in production while, a number below 50 indicates contraction. Though the factory sector growth in the month remained lower than the long-run series average, however, the PMI reading, which measures the overall health of manufacturing sector, suggested that factory activity saw strongest improvement in business conditions in last six months.
After showing signs of cooling and coming extremely close to contracting in the last few months, the manufacturing sector has bounced back on improved domestic and foreign demand, indicating that momentum in the sector is not as bad as other official manufacturing indicators pointed out recently. The month of December saw sharp rise in new order volumes while the rate of growth of manufacturing output accelerated to highest levels in four months. Besides, manufacturing sector employment rose in the month under review after four straight months of showing job losses. But, the rate of input cost inflation despite showing signs of easing in November, remained stubbornly above the long-run series average.
Meanwhile, the RBI after relentlessly hiking key interest rates thirteen times since March 2010 in its bid to rein in the inflationary pressure on the economy, showed some mercy and paused the liquidity tightening cycle in its last policy review meet in December. The RBI governor has also hinted at moving towards monetary easing as its concerns shifted from containing inflation to helping the cooling economy recuperate.
The S&P CNX Nifty is currently trading at 4,727.65, higher by 90.90 points or 1.96%. The index has touched a high and low of 4,733.25 and 4,675.80 respectively. There were 47 stocks advancing against 3 declines on the index.
The top gainers of the Nifty were Coal India up by 5.14%, Kotak Bank up by 4.98%, Tata Steel up by 4.08%, DLF up by 3.99% and Tata Motors up by 3.81%.
On the flip side, M&M down by 1.45%, BPCL down by 1.20% and Bajaj Auto down 0.10% remained the top losers on the index.
All the Asian equity indices were trading in the green; Hang Seng was up 2.07%, Jakarta Composite was up 0.84%, Straits Times was up 1.21%, Seoul Composite was up 2.69% and Taiwan Weighted was up by 1.46%.
Stock markets in China and Japan remained closed for extended New Year’s holiday.
