Post Session: Quick Review

The start of final week of ‘2014’ turned out to be cheerful one for local equity markets, which building on gains concluded at day’s high point on sustained buying activities by both funds and retail investors, underpinned by positive global set-up. Both, BSE Sensex and Nifty clocked second session of gains on Monday as stronger global markets lifted blue chips, easing some of the concerns about a recent selling streak by foreign investors. Foreign institutional investors bought a net of about $1.5 billion on Friday, according to exchange data, their first purchase after 11 consecutive sessions of selling. Back on Street, while Sensex concluded below 27, 350 and 8,200 levels respectively, with gains of around half a percent. Meanwhile, broader indices also equally participating into the rally went home with gains of around 0.50%-0.85%. However, trading volume remained low as investors stayed on the sidelines given that most global markets will have a shorter trading week.

Sentiment was also buttressed after Finance Minister asserted that he expects economy to grow ‘much better’ in 2015-16 as compared with the current fiscal. He pointed that while Indian economy is expected to grow by 5.3 percent in the September quarter from a year earlier, it would grow 5.5% in the current financial year that ends on March 31. Market sentiment also got a boost after reports suggested that the government is planning the ordinance route to make changes to the Land Acquisition Act. The report said that the government plans to exclude 13 central laws to clear several infrastructure and public private partnership projects.

On the global front, Asian stocks rose to the highest level in almost three weeks, buoyed by share gains in the US and new bank rules in China that will help spur lending. Meanwhile, European shares were mixed on Monday, as bourses reopened after a four-day break, with volumes expected to be light during the session. European shares were trading bit jittery ahead of the final round of voting in a Greek presidential election. If Prime Minister Antonis Samaras' preferred candidate fails to gain the 180 votes needed to win the election, a snap general election will be called.

Closer home, amidst across the board gains, all the sectoral indices on BSE concluded into positive territory, however, stocks from banking counter proved to be only exception to this trend. On the flip side, maximum gains were witnessed by stocks from Metal, Auto and Consumer Durables counters. Besides, investors also lapped up mining stocks on reports of China's central bank adjusting deposits calculation rules since China is the world's largest consumer of steel, copper and aluminum. Additionally, IT and Pharma stocks rose for yet another session tracking rupee’s weakness. A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports. The overall market breadth on BSE was in the favour of advances, which thumped decliners in the ratio of 1606:1313, while 117 shares remained unchanged.

The BSE Sensex ended at 27395.73, up by 153.95 points or 0.57% after trading in a range of 27266.49 and 27507.25. There were 23 stocks advancing against 6 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.87%, while Small cap index up by 0.53%. (Provisional)

The gaining sectoral indices on the BSE were Metal up by 2.36%, Auto up by 1.50%, Consumer Durables up by 1.02%, FMCG up by 0.77% and Power up by 0.76% while, Bankex down by 0.15% was the lone losing indices on BSE. (Provisional)

The top gainers on the Sensex were Sesa Sterlite up by 4.15%, Hindalco up by 3.02%, Tata Motors up by 2.32%, Coal India up by 1.92% and Hero MotoCorp up by 1.86%. On the flip side, Bharti Airtel down by 1.13%, ICICI Bank down by 0.57%, Mahindra & Mahindra down by 0.31%, SBI down by 0.21% and Cipla down by 0.06% were the top losers. (Provisional)

Meanwhile, in a major development for electronics manufacturing space, the government has approved clutch of investment proposals worth about Rs 6,000 crore in the past six months under electronics manufacturing schemes. However, this sums up to about 1/3 rd of the proposal received by the government, most of which were financial closures.

According to reports, while the government last year, only received proposals from the companies that were present in India, but in these last six months received proposal from both existing and new firms. Among the many, companies like Nidec, Continental, Motherson Sumi, Calsonic Kansei, Tissol, Tata SED, Tejas, Panasonic, were the ones which came with the proposal.

Expressing confidence in electronics manufacturing push of the Indian government, about 25-30 new companies across various segments and geographies tendered their proposals. The confidence was further boosted by the Reimbursement of Modified Special Incentive Package (MSIPS), benefit by the government.Under Modified Special Incentive Package (MSIPS), government provides subsidy for investments in capital expenditure with a limit of 20 per cent for investments in Special Economic Zone (SEZ) and 25 per cent in non-SEZs.

India VIX, a gauge for markets short term expectation of volatility slipped 0.34% at 14.59 from its previous close of 14.63 on Friday. (Provisional)

The CNX Nifty ended at 8246.30, up by 45.60 points or 0.56% after trading in a range of 8214.70 and 8279.15. There were 38 stocks advancing against 12 stocks declining on the index. (Provisional)

The top gainers on Nifty were Asian Paints up by 4.20%, Sesa Sterlite up by 3.76%, Jindal Steel & Power up by 3.35%, Hindalco up by 3.32% and Coal India up by 2.26%. On the flip side, PNB down by 1.24%, Cairn India down by 1.10%, Bharti Airtel down by 0.87%, Kotak Mahindra Bank down by 0.76% and NMDC down by 0.69% were the top losers. (Provisional)

European Markets were trading mixed; UK’s FTSE 100 was up by 0.15% while, France’s CAC was down by 0.33% and DAX was down by 0.70%.

The Asian equity benchmarks ended mostly in green on Monday, with Hong Kong shares jumping the most in a year amid speculation that government steps to spur lending will bolster economic growth. Japan’s government approved a 3.5 trillion yen ($29 billion) fiscal stimulus package to boost the economy after April’s sales tax hike caused consumption to slump. The measures include shopping vouchers, subsidized heating fuel for the poor and low interest loans for small businesses hurt by rising input costs, and will boost gross domestic product by 0.7%, the government estimates. Unexpected falls in output and retail sales in November underscore the continued weakness in the economy. With little sign of a rebound in domestic demand, getting growth back on a recovery track is a priority for Prime Minister Shinzo Abe.

China’s trade growth is seen falling short of target in 2014. According to a report by the Ministry of Commerce, the country’s trade will grow 3.5% in 2014, implying the country will fall short of a current 7.5% official growth target. China’s trade figures have repeatedly fallen short of expectations in the second half of this year, providing more evidence that China’s economy may be facing a sharper slowdown. Thai Industrial Production fell to a seasonally adjusted -3.5%, from -2.9% in the preceding month.