Markets soar to day’s high as bulls continue their run

Going from strength to strength, local equity markets were trading near day’s high point on account of sustained buying activities by funds and retail investors amidst positive global set-up. Markets after scaling a life time high levels in previous trading session, got off to a good start and has been trading bullish thereafter. Sentiment also got a lift after international rating agency, Moody’s, in its report titled 'Recent policy changes to support growth acceleration,'  termed recent measures by the government coupled with those unveiled by the Reserve Bank of India (RBI) on the economic, fiscal and financial fronts as ‘credit positive’ for the economy. At day’s high, both Sensex and Nifty were trading above psychologically crucial 27,700 and 8,250 levels respectively, with hefty gains of around 1.25%. Meanwhile, broader indices also participating into the rally were trading with gains of over a percent.

On the global front, optimism was sensed across entire Asian pacific shares after the Bank of Japan (BoJ) unexpectedly increased its target for monetary expansion. The BoJ said it will increase holdings of government bonds by Yen 80 trillion ($723 billion) and boost exchange-traded fund purchases to Yen 3 trillion.

Closer home, much of the sectoral indices on BSE were endorsing the underlying strength of local equity markets, while stocks from Consumer Durable counter were playing spoil-sports. On the flip side, much of the demand was witnessed by stocks from Capital Goods, Metal and Public Sector Undertaking (PSU) counters, which were the top gainers of the session. Meanwhile, Shares of real estate and infrastructure companies extended their previous day’s rally after government relaxed foreign direct investment (FDI) rules in the construction sector by reducing minimum built up area as well as capital requirement and easing exit norms. Additionally, IT counters gains were led by Infosys stocks, which rallied to record high level. The overall market breadth on BSE is in the favour of advances which thumped declines in the ratio of 1723:910; while 110 shares remained unchanged.

The BSE Sensex is currently trading at 27726.42, up by 380.09 points or 1.39% after trading in a range of 27438.28 and 27759.01. There were 27 stocks advancing against 3 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.19%, while Small cap index up by 1.09%.

The gaining sectoral indices on the BSE were Capital Goods up by 1.89%, Metal up by 1.80%, PSU up by 1.68%, Oil & Gas up by 1.54% and INFRA up by 1.51% while, Consumer Durables down by 2.56% was the only losing index on BSE.

The top gainers on the Sensex were Tata Steel up by 3.13%, HDFC up by 3.10%, Maruti Suzuki up by 2.80%, Larsen & Toubro up by 2.50% and Hero MotoCorp up by 2.07%. On the flip side, Bharti Airtel down by 1.36%, Hindustan Unilever down by 0.27% and ICICI Bank down by 0.05% were the top losers.

Meanwhile, to kick-start the development of stalled projects, the government is expected to make amendments to land acquisition act during the winter session of Parliament, which would commence since November 24, 2014. Among many things, Centre may decide upon dilution of the consent clause, restricting social impact assessment to large projects and giving states the powers to define 'emergency' under 'urgency clause' for acquiring land, which are some of the many demands sought by states. The Act has faced criticism from various quarters including some states.

Further, it is on account of contentious nature of the legislation, the government has been holding wide-ranging consultations to ensure a smooth sailing when the amendments are tabled in the Parliament. According to Commerce and Industry Minister Nirmala Sitharaman, the government is looking for amendments for making the acquisition process easier without making changes on the compensation clause. The Rural Development Ministry has already suggested a number of amendments that will ease provisions such as mandatory consent of at least 70% locals for acquiring land for PPP projects and 80% for private projects. 

Moreover, the bill could witness some drastic changes, if Prime Minister Narendra Modi approves Ministry's proposals which also include dilution of a key clause of Social Impact Assessment study criticised by states as time consuming for industrialization process. However, the centre will focus on the changes, which has consensus.  The CNX Nifty is currently trading at 8276.15, up by 106.95 points or 1.31% after trading in a range of 8198.05 and 8291.65. There were 45 stocks advancing against 5 stocks declining on the index.

The top gainers on Nifty were IDFC up by 3.84%, HDFC up by 2.88%, Maruti Suzuki up by 2.84%, Tata Steel up by 2.78% and NMDC up by 2.44%. On the flip side, Bharti Airtel down by 1.55%, Zee Entertainment down by 0.68%, DLF down by 0.36%, ICICI Bank down by 0.30% and Hindustan Unilever down by 0.11% were the top losers.

Asian markets were trading mostly in positive territory; with FTSE Bursa Malaysia KLCI trading higher by 5.48 points or 0.3% to 1,848.26; KOSPI Index trading higher by 5.5 points or 0.28% to 1,964.43; Jakarta Composite trading higher by 9.22 points or 0.18% to 5,068.07; Straits Times trading higher by 27.2 points or 0.84% to 3,261.51; Shanghai Composite trading higher by 31.12 points or 1.3% to 2,422.20; Taiwan Weighted trading higher by 86.69 points or 0.98% to 8,974.76; Hang Seng trading higher by 273.36 points or 1.15% to 23,975.40 and  Nikkei 225 trading higher by 755.56 points or 4.83% to 16,413.76.