Post Session: Quick Review

Indian equity markets, in line with global markets, extended their ‘Santa Rally’ on Monday as recovery in beaten down oil prices, provided relief to investor’s across the globe, which in turn heaved both Sensex and Nifty above psychologically crucial 27,700 and 8,300 levels respectively, with splendid gains of around 1.25%. Markets, which moved in tight range for most part of their session, witnessed sharp spurt in last hours of trade. Gains of defensive shares on growing concerns of FII’s withdrawing their money till year end mainly kept the markets in positive territory for the first half of session, while positive start of European counterparts provided the required impetus during the later hours. Foreign investors sold nearly $1 billion worth of shares over nine consecutive sessions of selling, amid a brewing financial crisis in Russia and a crude oil slump, regulatory data show. Nevertheless, the session clearly belonged to broader indices, which went home with gains in the range of 0.35%-0.95%.

On the global front, Asian shares, which took their cues from Wall Street, kicked off a holiday-shortened week on a strong footing on Monday. However, activity remained thin this week, with many investors away for Christmas and run-up to New Year holidays. European shares were trading higher on Monday as a recovery in beaten-down oil prices and the rouble and more calls for quantitative easing from the ECB helped lift sentiment.

Closer home, with across the board buying taking place, all the sectoral indices on BSE concluded into positive territory, nevertheless stocks from PSU, Power and FMCG counters were the top gainers of the session. On the flip side, there were no losers  on sectoral front, however, shares of tyre companies like Apollo Tyres, Ceat and JK Tyre witnessed immense pressure as reports suggest of these companies agreeing to procure rubber from the domestic market, which is 25% higher price over international price to aid the fund-starved sector in Kerala. Meanwhile, banking shares, which were trading lower in first half of the session, also made a splendid recovery by close of trade. The market breadth on the BSE remained in the favour of advances, where advancing and declining stocks were in a ratio of 1557:1349, while 118 scrips remained unchanged. (Provisional)

The BSE Sensex ended at 27355.31, up by 228.74 points or 0.84% after trading in a range of 27292.14 and 27497.12. There were 21 stocks advancing against 9 stocks declining on the index. (Provisional)

The broader indices ended in the in green; the BSE Mid cap index was up by 0.92%, while Small cap index up by 0.35%. (Provisional)

The gaining sectoral indices on the BSE were PSU up by 1.72%, Power up by 1.48%, FMCG up by 1.47%, Bankex up by 1.47% and Auto up by 1.40% while there were no losers on the index (Provisional)

The top gainers on the Sensex were Mahindra & Mahindra up by 4.09%, Coal India up by 3.78%, BHEL up by 2.68%, HDFC Bank up by 2.60% and HDFC up by 2.60%. On the flip side, Hindalco down by 1.17%, Larsen & Toubro down by 0.82%, Infosys down by 0.15% and Tata Steel down by 0.09% were the top losers. (Provisional)

Meanwhile, suggesting ways for domestic manufactures to boost exports, Commerce Ministry has stated that Indian industry must enhance competitiveness and align themselves with the modern elements of international trade by promoting and integrating with the global value chains. Commerce Secretary Rajeev Kher has asserted that the manufacturing companies should focus on developing new technology, making new strategy for product development and enhance production efficiency to make their product globally competitive instead of demanding more relaxation from the government to protect their products in global markets.

On the tax issue for Special Economic Zones (SEZs), Rajeev Kher has said that the issue of removal or lowering of minimum alternate tax (MAT) and dividend distribution tax (DDT) imposed on SEZs could be addressed in next year’s Budget. A MAT of 18.5 per cent and a DDT of 15 per cent was imposed on SEZs a few years ago despite the policy promising a tax-free regime for a fixed number of years. Meanwhile, he stressed that SEZs will soon be allowed to use infrastructure created within the non-processing areas of the zones for general use ensuring optimum utilisation.

During April-November FY15, the value of India’s overseas shipments increased by 5.02% to $215.76 billion from $205.44 billion in the same period of previous financial year. Amid raising concerns over the delay in announcement of the FTP, Commerce Ministry recently highlighted that a new foreign trade policy (FTP) is under consultation and finalization. FTP, which governs all exports and imports related activities in India, ended on March 31 and the new government will introduce new FTP for the period 2014-19. However, eight months of the current fiscal are already over.

India VIX, a gauge for markets short term expectation of volatility declined 2.06% at 14.21 from its previous close of 14.51 on Friday. (Provisional)

The CNX Nifty ended at 8324.00, up by 98.80 points or 1.20% after trading in a range of 8228.20 and 8330.95. There were 43 stocks advancing against 7 stocks declining on the index. (Provisional)

The top gainers on Nifty were Jindal Steel & Power up by 6.20%, Coal India up by 3.82%, Mahindra & Mahindra up by 3.53%, NMDC up by 3.45% and Cairn India up by 3.43%. On the flip side, Hindalco down by 1.27%, Zee Entertainment down by 0.81%, Larsen & Toubro down by 0.71%, Tata Steel down by 0.35% and PNB down by 0.31% were the top losers. (Provisional)

European Markets were trading in the green; UK’s FTSE 100 was up by 1.08%, Germany’s DAX was up by 0.75% and France’s CAC was up by 1.11%.

The Asian equity benchmarks ended mostly in green on Monday, with Chinese stocks trading in Hong Kong rallied the most in two weeks amid speculation the government will take more measures to support economic growth and the slump in oil prices may be excessive. China’s factory output is likely to rise about 8.3% in 2014 from a year earlier. Factory output rose 7.2% in November from a year earlier, down from October’s 7.7%. South Korea cut its bullish growth forecasts for both this year and next but its revised projections were still seen as too optimistic, supporting expectations of an interest rate cut early next year. The Ministry of Strategy and Finance forecasted that economy will grow by 3.4% this year, down from 3.7% projected in July, with private investment and sentiment turning out weaker than the government had expected. It also downgraded its 2015 growth forecast to 3.8% from 4%.

Singapore’s headline inflation rate in November may turn negative for the first time in five years due partly to sliding oil prices, and a few economists see scope for the central bank to ease tight monetary policy to support economic growth. The last time the Monetary Authority of Singapore (MAS) eased monetary policy was October 2011. It has stuck to a framework of allowing a modest and gradual appreciation of the Singapore dollar since April 2010 to curb inflationary pressures.