Post Session: Quick Review

Indian equity markets, stretching their run-up for sixth straight session, rallied over 1.15% on Tuesday thanks to sustained buying activities of funds and retail investors, driven by strong corporate earnings and positive global set-up. In the extremely stable session of trade, there appeared no iota of profit-booking, however much-in line with trend observed in previous few trading sessions, much of buying came in the late hours of trade, which heaved the markets to day’s high point by close of trade. The buying activity in today’s trading session, which not only turned out to be frenzied, but also broad-based, underpinned markets to register second high closing level, which took Sensex and Nifty above the psychologically crucial 26,000 and 7,750 levels respectively, with gains of over a percent. However, the session failed to be yielding for broader indices, with Midcap index managing to settle higher by one tenth of a percent and Smallcap index closing flat with negative bias.

On the global front, Asian stocks touched a three-year peak on Tuesday, despite lingering concerns about crises in Ukraine and Gaza, with Hong Kong's benchmark index outperforming rest of its peers by scaling its highest level in more than seven months as recent fund inflows pushed up the territory's blue-chip stocks. Additionally, European shares rebounded on Tuesday with traders hoping for an easing of tensions between Russian and the West after pro-Russian rebels agreed to hand over the black boxes from the Malaysian plane downed in Ukraine last week.

Closer home, sentiment also got a push after Finance Minister Arun Jaitley exuded confidence that tax collection would exceed the set target during the current fiscal, however, more than positive global set-up, sharpened risk-appetite of market-participants. Sectorally, much of buying interest was garnered by stocks from Technology counter, followed by Information Technology and Oil & Gas counter. On the flip side, stocks from Capital Goods and Power counters took a beating for the worst and ended with losses. Besides, Telecom stocks also rang loud after sector regulator TRAI permitted spectrum sharing among telecom service providers across all six frequency bands, namely 800, 900, 1800, 2100, 2300 and 2500MHz that have been identified for farm-out among telecom service providers.

On the earning front, telecom operator Idea Cellular reported a 57 percent jump in quarterly profit on Monday, benefiting from fewer competitors, higher call rates and more customers using data plans. Company’s consolidated net profit surged 57.37% to Rs 728.20 crore on 15.63% growth in total revenue to Rs 7560.99 crore in the quarter ended June 30, 2014 over corresponding quarter of the previous year. The market breadth on the BSE divided evenly; advances and declining stocks were in a ratio of 1475: 1487, while 115 scrips remained unchanged. (Provisional)

The BSE Sensex gained 310.63 points or 1.24% to settle at 26025.80. The index touched a high and a low of 26050.38 and 25780.39 respectively. 23 stocks gained against 7 declines on the index. (Provisional)

The BSE Mid cap and Small cap indices ended in cautiously, the BSE Midcap was up by 0.11%, while the BSE Small cap index was lower by 0.01%. (Provisional) 

On the BSE sectoral front, TECk was up by 2.02%, IT up by 1.78%, Oil and Gas up by 1.74%, Consumer Durables up by 1.16% and Infrastructure up by 1.12% were the few gainers, while Capital Goods down by 0.69% and Power down by 0.33% were the major losers in the space. (Provisional)

The top gainers on the Sensex were Bharti Airtel up by 4.61%, RIL up by 3.37%, HDFC up by 2.90%, Wipro up by 2.62% and Tata motors was up by 2.60%. On the flip side, L&T down by 1.04%, M&M down by 0.75%, Maruti Suzuki down by 0.74%, Hero MotoCorp down by 0.18% and BHEL down by 0.06% were the major losers. (Provisional)

Meanwhile, amid concerns over the increasing fuel shortage for domestic power producers, the government has advised power producers to import 54 million tonnes (MT) of coal in the current fiscal to meet the shortfall.

Power Minister Piyush Goyal asserted that due to shortage of domestic coal, it cannot be possible to meet 100 percent requirement of power producer (including NTPC) from domestic coal production. Power utilities including NTPC are currently importing coal to bridge the shortfall in availability of domestic coal. During the April-June period of 2014, NTPC, the country's largest power producer, imported 3.6 MT of dry fuel as against annual target of 16.6 MT.

Coal shortage in the country has become a concern for Indian power sector as coal-fired plants account for 59% of India's installed electricity capacity. India, despite being world's fifth largest in terms of reserves and the third-largest producer of coal, has failed to keep pace with increasing domestic demand. Indian domestic coal demand is around 35 percent higher than domestic supply. India’s coal imports during last fiscal increased to 168.44 MT as compared to 145.78 MT in FY13.

Coal India (CIL), the only producer of coal in the country, is struggling to meet domestic coal requirements. CIL production fell 4.21 percent short of its production target to 462.53 million tonnes in FY14 amid concerns like shutdown of mining activities in Talcher Coalfields in Odisha. The government has set coal production target at 507 million tonnes for CIL for FY15.

India VIX, a gauge for markets short term expectation of volatility declined 1.42% at 14.68 from its previous close of 14.89 on Monday. (Provisional)

The CNX Nifty ended higher by 83.65 points or 1.09% to settle at 7,767.85. The index touched high and low of 7,773.85 and 7,704.80 respectively. 34 stocks ended in the green against 16 stocks ending in red. (Provisional)

The major gainers of the Nifty were Bharti Airtel up by 4.79%, RIL up by 3.24%, HDFC up by 2.86%, Wipro up by 2.78% and TCS was up by 2.70%. On the flip side, the key losers were Maruti Suzuki down by 1.03%, PNB down by 1.01%, L&T down by 0.98%, M&M down by 0.98% and Bank of Baroda down by 0.76%. (Provisional)

European markets were trading in green; UK’s FTSE 100 up by 0.74%, Germany’s DAX was up by 0.83% and France’s CAC 40 was up by 0.90%.

The Asian markets concluded Tuesday’s trade mostly in green, with the regional benchmark index on course for its highest close in six years, as investors shrugged off geopolitical tensions in Ukraine and in the Middle East. Hong Kong’s indices rose amid speculation that government will do more to shore up economic growth. The main economic data point due this week will be preliminary manufacturing data for China on Thursday. Recent data from China, including factory numbers as well as second-quarter growth figures, have helped support the view that Asia’s largest economy has troughed after a slowdown earlier this year. A majority of Bank of Japan board members disagree with Governor Haruhiko Kuroda’s view that flooding the economy with cash is sufficient to get stable 2% gains in consumer prices. Most conclude it cannot be done without government steps to raise Japan’s growth potential. Japan’s All Industries Activity Index rose to a seasonally adjusted 0.6%, from -4.6% in the preceding month whose figure was revised down from -4.3%.