Markets off day’s high; yet continue to trade with healthy gains

In the extremely optimistic session of trade, local equity markets although have come off from day’s high point, but continued trading higher in afternoon deals on sustained buying activities by participants, largely driven by better than expected earnings of corporates. IT major, Wipro, spurted over 5% after the company reported strong results helped by client additions and an increase in spending by customers in a seasonally weak quarter for information technology (IT) firms. The company’s net profit in the three months ended December 31, 2014 rose 8.8% to Rs.2,192.8 crore from Rs.2,014.7 crore in the year-ago quarter,  while its revenue rose 6.7% to Rs.12,085 crore from Rs.11,327 crore a year earlier. Off day’s high, both Sensex and Nifty were trading below 28,300 and 8,550 levels respectively, although with gains of around half a percent. Meanwhile, broader indices also outperforming larger counterparts, were trading with gains of over 0.50%.

On the global front, Most Asian share markets followed Wall Street higher on Monday, though investors were wary of being disappointed yet again by economic data from China and policy stimulus in the euro zone.  Adding to the air of caution was a retreat in Chinese equities, in part on news the securities regulator had barred three major brokerages from opening new margin trading accounts for clients for three months.

Closer home, with across the board gains, all the sectoral indices on BSE were trading into positive territory, however, only stocks from Realty counter were the losers of the session. On the flip side, stocks from Consumer Durables, Infrastructure and Capital Goods counters were leading the gains. In stock-specific activity, Shares of four oil exploration and production firms rose 0.87% as Brent crude oil prices traded around $50 a barrel on Monday, with some support coming from falling U.S. output growth but an expectation of weak Chinese economic data weighing on markets. The overall market breadth on BSE was in the favour of advances which thumped declines in the ratio of 1421:583; while 39 shares remained unchanged.

The BSE Sensex is currently trading at 28247.50, up by 125.61 points or 0.45% after trading in a range of 28197.36 and 28334.06. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.59%, while Small cap index up by 0.75%.

The gaining sectoral indices on the BSE were Consumer Durables up by 2.51%, INFRA up by 1.23%, Capital Goods up by 0.96%, Oil & Gas up by 0.96%, Bankex up by 0.78%.

The top gainers on the Sensex were Wipro up by 5.90%, GAIL India up by 4.51%, Axis Bank up by 2.59%, BHEL up by 2.17% and Bharti Airtel up by 1.58%. On the flip side, Hindustan Unilever down by 1.64%, Hero MotoCorp down by 1.26%, HDFC down by 1.19%, TCS down by 0.84% and Infosys down by 0.67% were the top losers.

Meanwhile, on much expected lines, the government in the previous week slashed petrol and diesel prices by Rs 2.25 and Rs 2.42 per litre, respectively. However, in a major twist, the rate cut came right after excise duty on the products were hiked by Rs 2 per litre. Notably, this marks ninth straight reduction in petrol prices since August and fifth in diesel since October.

Petrol and diesel prices were last slashed in the mid of the previous month by Rs 2 per litre each. Including latest reduction, petrol price have been cut by Rs 14.69 per litre on a cumulative basis since August, while diesel rates in five downward revisions have been slashed by a total of Rs 10.71 a litre. With this, petrol, in Delhi will cost Rs 58.91 a litre, the lowest in 44 months, as compared to Rs 61.33 a litre now. Similarly, diesel will cost Rs 48.26 a litre in Delhi, the lowest since April 2013, as against Rs 50.51 currently.

Meanwhile, the excise duty on unbranded petrol has been hiked to Rs 8.95 per litre, branded petrol to Rs 10.10, unbranded diesel to Rs 7.96 and branded diesel to Rs 10.25 per litre. The latest hike in excise duty is the fourth one and would result in about Rs 20,000 crore in additional revenue this fiscal and will help the government meet its fiscal deficit target of 4.1% of the GDP. The government had last raised the excise duty on petrol and diesel by Rs 2 per litre each from 2 January. Prior to that, the tax was hiked by Rs 1.50 a litre each from 12 November and Rs 2.25 per litre on petrol and Re 1 on diesel from December 2.

The CNX Nifty is currently trading at 8541.80, up by 28.00 points or 0.33% after trading in a range of 8531.50 and 8570.95. There were 31 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Wipro up by 6.00%, GAIL India up by 4.29%, Axis Bank up by 2.72%, BHEL up by 2.34% and IDFC up by 2.04%. On the flip side, BPCL down by 1.96%, Hindustan Unilever down by 1.70%, Hero MotoCorp down by 1.35%, DLF down by 1.33% and HDFC down by 1.28% were the top losers.

Asian markets were trading mostly higher; with Straits Times trading up by 0.11 points or 0% to 3,300.79; FTSE Bursa Malaysia KLCI trading up by 6.05 points or 0.35% to 1,749.62;  KOSPI Index trading up by 14.49 points or 0.77% to 1,902.62;  Taiwan Weighted trading up by 35.77 points or 0.39% to 9,174.06; Nikkei 225 trading up by 150.13 points or 0.89% to 17,014.29;  Hang Seng trading up by 480.69 points or 1.99% to 23,622.83; while, Shanghai Composite trading down by 261.02 points or 7.73% to 3,115.48 and  Jakarta Composite trading up by 4.63 points or 0.09% to 5,143.75 were the only two losers among the Asian pack.