Strong global cues fortify benchmarks; Nifty surpasses 8,200 mark

Boisterous benchmarks showcased an enthusiastic performance on Thursday, by rallying around one and a half percentage points amid strong global cues. Sentiments remained up-beat since start as key bourses opened with huge gap on upside and there appeared not even an iota of profit booking in the session as the benchmarks managed to fervently gain from strength to strength as investors continued hunt for fundamentally strong stocks. Frontline indices not only ended the session near intraday high levels but also recaptured their crucial 8,200 (Nifty) and 27,250 (Sensex) bastions as investors took to hefty across the board buying.

Sentiments got bolstered after Finance Minister Arun Jaitley’s statement that the ongoing global slow growth is an opportunity for the country as investors are eyeing this market. The union minister said investments would trigger economic activity which will in turn boost growth and lead to job creation.

Buying got extended after European markets made a firm start and were trading higher in early deals tracking gains in the United States and Asia, as retail stocks rallied and the minutes from the Fed’s recent meeting reassured investors that it was not in a hurry to start raising rates. Asian markets ended mostly in the green after upbeat US employment data and a halt to a slide in oil tempered investor risk aversion, while the euro held near a nine-year low.

Back home, there was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too participated strongly in the rally. Appreciation in Indian rupee too supported the sentiments. The partially convertible rupee was trading at 62.66 per dollar at the time of equity market closing against the Wednesday’s close of 63.17 on the Interbank Foreign Exchange.

Meanwhile, software and technology stocks remained on buyers’ radar on positive jobs data from US, with Infosys concluding higher ahead of its Q3 results, January 9, 2015. United States is the world’s biggest outsourcing market for Indian IT firms. Banking stocks too edged higher on hopes of rate cut by RBI in its upcoming monetary policy review in February. Additionally, hospitality firms advanced after latest data showed that Foreign Tourist Arrivals to India increased 6.8% to 8.77 lakh in December 2014 over December 2013.

The NSE’s 50-share broadly followed index Nifty rose by over one hundred and thirty points and ended above the psychological 8,200 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex surged by over three hundred and sixty points to finish above the psychological 27,250 mark. Broader markets too were traded with traction throughout the trade and ended the session with a gain of around two percentage points. The market breadth remained in favor of advances, as there were 2,050 shares on the gaining side against 823 shares on the losing side while 101 shares remain unchanged.

Finally, the BSE Sensex surged by 365.89 points or 1.36%, to 27274.71, while the CNX Nifty soared by 132.50 points or 1.64% to 8,234.60.

The BSE Sensex touched a high and a low of 27316.41and 27101.94, respectively. The BSE Mid cap index was up by 1.82%, while the Small cap index was up by 1.79%.

The top gainers on the Sensex were Tata Motors up by 3.68%, ICICI Bank up by 2.52%, ITC up by 2.52%, Hindalco up by 2.41% and GAIL India up by 2.20%. On the flip side, Reliance Industries down by 1.47% was the only loser.

On the BSE Sectoral front Realty up by 2.63%, Bankex up by 2.07%, FMCG up by 1.95%, Power up by 1.62%, INFRA up by 1.61% were the top gainers, while there were no losers in the space. 

Meanwhile, with an aim to boost the domestic economic growth, Finance Minister Arun Jaitley has asserted that India needs to create an environment for cyclic investments and ease norms of doing business. Arun Jaitley added that investments would trigger economic activity which will in turn will boost growth and lead to job creation. The Minister also called for easing out norms and rules governing investment to boost the industrial landscape and lead the growth.

Observing that ongoing global slow growth as an opportunity for India, Finance Minister stressed that after the US, global investors are looking at India to invest. By adding further, Finance Minister said that the US economy is the strongest one in the world while all other countries like Japan, China, Brazil and South Africa are facing challenges. Therefore, there is a need to strengthen the economy for people from all over the world to come and invest in the country.

After registering an average growth rate of 8% during FY08-FY12, Indian economic growth had slowed down to below 5% over the last two financial years. The factors like high interest rate and stubborn inflation, low investments and slow execution of infrastructure projects have impacted country's economy growth.  However, the economy has shown signs of nascent recovery and expanded at 5.5% during first half of this fiscal as compared to 4.9% in the same period of previous fiscal. 

The CNX Nifty touched a high and low of 8,243.50 and 8,167.30 respectively.

The top gainers on Nifty were Asian Paints up by 6.45%, DLF up by 5.68%, Kotak Mahindra Bank up by 5.62%, Bharat Petroleum Corporation up by 5.50% and Jindal Steel & Power up by 5.09%. On the flip side, Reliance Industries down by 1.32%, Zee Entertainment Enterprises down by 0.10%, were the only losers.

European Markets were trading in the green; UK's FTSE 100 was up by 1.18%, France's CAC was up by 1.65% and Germany's DAX was up by 1.13%.

The Asian equity benchmarks ended mostly in green on Thursday, while Chinese stocks fell the most in two weeks. Japan’s government is preparing a projection of real economic growth of around 1.5% in the next fiscal year after marking its first economic contraction this year since the global financial crisis. The government projection compared with a forecast of 1.4% growth issued in July, and is in line with the Bank of Japan’s growth estimate published in October. The government’s forecast provides the basis for its economic policies, including its annual budget plan for the next fiscal year, which will be decided on January 14. Malaysian Trade Balance rose to 11.13B, from 1.20B in the preceding month. The Central Statistics Agency, or BPS, last week released Indonesia’s latest poverty data, which found that 27.73 million people, or about 11% of the country’s population, lived below the poverty line as of September last year.