Benchmarks log fresh all time closing highs

Coming out from consolidation mood, Indian equity benchmarks once again scaled fresh all time closing high levels, gaining around half a percent buoyed by firm global cues. Key indices traded comfortably in the green throughout the session on penultimate session of August F&O series as sentiments remained up-beat on reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 364.72 crore on August 26, 2014, as per provisional data from the stock exchanges.

Sentiments remained up-beat amid expectations that further monetary stimulus in the euro zone could trigger more foreign fund flows to emerging markets. Investors were also awaiting Q1FY15 GDP data and Current Account Deficit numbers, due later in the week. Street widely expects Asia’s third largest economy is likely to grow 5.3% in the first quarter of this fiscal year (April-March), up from 4.6 percent in January-March, which would be the fastest since the quarter that ended in March 2012.

Supportive cues from US markets provided the much needed support to local markets initially on the back of strong economic data and a flurry of merger news. Asian markets too ended mostly in the green. Japanese markets edged higher on report that the nation’s pension fund freed itself to buy more domestic equities. However, European markets were trading cautiously in early deals on Wednesday after worse-than-projected German confidence data.

Back home, sentiments remained up-beat after Oil Ministry said that it will seek Cabinet nod for freeing diesel prices after retail rates achieve parity with global levels, and has proposed to cut subsidy payout by upstream firms like ONGC and Oil India by half. Banking stocks too remained on buyers’ radar after the State Bank of India and HDFC brought down home loan rates, compelling others to follow suite. Besides, the software and technology pack witnessed buying and ended in the positive territory on news of encouraging US economic data.

Meanwhile, auto sector ended higher led by Tata Motors, up by around 2% after challenging the Competition Commission of India (CCI) order that imposed huge penalty on auto companies. Additionally, companies related to defence supply edged higher, as the government has notified increase in foreign direct investment (FDI) limit to 49 percent through approval route in the defence sector.

The NSE’s 50-share broadly followed index Nifty edged higher by over thirty points to end near its psychological 7,950 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex rose by around one hundred and twenty points to finish above the psychological 26,550 mark. Broader markets traded with traction and ended the session with a gain of over half a percent. The market breadth remained in favour of decliners, as there were 1130 shares on the gaining side against 1828 shares on the losing side while 116 shares remain unchanged.

Finally, the BSE Sensex surged by 117.34 points or 0.44%, to 26560.15, while the CNX Nifty gained 31.30 points or 0.40% to 7,936.05.

The BSE Sensex touched a high and a low of 26599.12 and 26492.50, respectively. The BSE Mid cap index was up by 0.73%, while the Small cap index gained 0.79%.

The top gainers on the Sensex were ONGC up by 2.31%, ICICI Bank up by 2.05%, Tata Motors up by 1.70%, Hero MotoCorp up by 1.61% and Bajaj Auto up by 1.49%. On the flip side, Sesa Sterlite down by 1.67%, NTPC down by 1.45%, BHEL down by 1.29%, HDFC Bank down by 0.70% and Tata Steel down by 0.41% were the top losers in the index.

On the BSE Sectoral front, Oil & Gas up by 0.84%, Auto up by 0.81%, IT up by 0.75%, Consumer Durables up by 0.64% and PSU up by 0.63% were the top gainers, while Realty down by 1.35%, Power down by 0.61%, INFRA down by 0.36%, Metal down by 0.21% and Healthcare down by 0.04% were the top losers in the space.

Meanwhile, in order to enhance India’s exports, the central government has asked states to appoint export commissioners to expedite efforts to boost country’s overseas shipments. The government is of the view that export commissioner would help in ensuring easing of bottlenecks and development of infrastructure through appropriate allocation of plan resources.

Over the past few months, Commerce Ministry has been taking various measures to involve state governments to boost country's exports. States’ nodal officers have been asked to develop export strategy, work with the state governments to implement such strategies and also prepare a list of infrastructure projects which will ensure full potential of exports growth. In last month, Commerce and Industry Minister Nirmala Sitharaman had written to the Chief Ministers of 15 states regarding their involvement in expansion of exports to help contain the current account deficit.

During April-July’FY15, the value of India’s overseas shipments increased by 8.62% to $107.84 billion from $99.28 billion in the same period of previous financial year. India’s export is likely to continue this growing trend given the improving global trade scenario with positive developments in the EU, US and emerging economies. Further, the government will announce new Foreign Trade Policy (FTP) for the period 2014-19 by end of September, which is expected to abolish conventional method of exports and promote exports of specific products in specific geographies.  

The CNX Nifty touched a high and low of 7,946.85 and 7,916.55 respectively.

The top gainers of the Nifty were IndusInd Bank up by 3.27%, Jindal Steel & Power up by 3.12%, HCL Technologies up by 2.96%, ONGC up by 2.61% and ICICI Bank up by 2.45%. On the other hand, DLF down by 4.49%, BHEL down by 1.72%, SSLT down by 1.39%, IDFC down by 1.36% and NMDC down by 1.14% were the top losers.

Most of European markets were trading in red, France's CAC 40 was down by 0.07% and Germany's DAX was down by 0.09%, while United Kingdom's FTSE 100 was up by 0.08%.

Asian markets ended mostly in green on Wednesday, after US data on durable goods and consumer confidence boosted optimism in the strength of the world’s largest economy. Hong Kong stocks fell, with the benchmark index capping its biggest two-day drop in almost three weeks. China’s benchmark money-market rate rose the most in a month as initial public offerings and month-end demand reduced cash supply. Lenders in China typically need to boost holdings of funds at the end of the month to meet regulatory requirements. Thailand is planning new rules to check stock-market manipulation by allowing the regulator to file civil lawsuits and impose hefty fines on the law-breakers. Indonesia’s central bank’s deputy governor Perry Warjiyo stated that the country’s annual inflation is expected to slow to 3.7% in August, down from 4.53%. Bank Indonesia’s inflation target for all of 2014 is between 3.5% and 5.5%. Separately, Warjiyo added that the current account deficit is expected fall to around 3.8% of gross domestic product in the third quarter, down from 4.27% in the previous three months. The current level of consumer confidence in South Korea rose unexpectedly last month. South Korean Consumer Confidence rose to 107, from 105 in the preceding month.