Benchmarks extend winning streak for third straight day

Extending their winning streak for third day in a row, Indian equity benchmarks ended the session with a gain of around half a percent. Barometer gauges, after a firm opening, traded in tight band throughout the session with frontline gauges ending above their crucial 28,250 (Sensex) and 8,550 (Nifty) levels. Encouraging corporate earnings and strong pick-up in oil prices mainly buoyed the trading sentiment. Some support also came on report that the Foreign Direct Investment (FDI) for April-November period of the ongoing fiscal, grew by 22% to $ 18.88 billion as against $15.45 billion in the same period a fiscal before. Meanwhile, foreign institutional investors were net buyers in Indian equities worth Rs 1,100 crore on January 16, 2015, as per provisional stock exchange data.

Supportive cues from US markets provided the much needed support to local markets initially. Positive closing in Asian markets too supported the sentiments, though investors were wary of being disappointed yet again by economic data from China. Moreover, European shares were trading higher in early deals, adding to last week’s strong gains, helped by mounting expectations the European Central Bank is about to embark into a bond-buying programme to support the euro zone economy.

Back home, appreciation in Indian rupee too supported the sentiments. The partially convertible rupee was trading at 61.75 per dollar at the time of equity market closing against the Tuesday’s close of 61.87 on the Interbank Foreign Exchange. Meanwhile, select stocks from software and technology pack edged higher after Wipro reported better than expected numbers for Q3FY15. The company’s net profit after taxes, minority interest and share of profit / (loss) of associates rose 8.84% to Rs 2192.80 crore for the Q3 FY15 as compared to Rs 2014.70 crore in Q3 FY14. Banking stocks too remained on buyers’ radar on hopes that lower interest rates would help revive loan growth.

Moreover, consumer goods stocks continued to gain for third day in a row as easing inflation would increase the purchasing power of consumers while consumer loans would become cheaper on the back of lower interest rates. On the flip side, PSU oil marketing companies edged lower after reduction in the prices of petrol and diesel by Rs 2.42 and Rs 2.25 a litre, respectively, even as the government earlier in the day announced increasing excise duty on these fuels by Rs 2 a litre each. The price reduction, as well as the excise increase, came into effect from Friday midnight.

The NSE’s 50-share broadly followed index Nifty gained by over thirty points to end above its psychological 8,550 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex surged by over one hundred and forty points to end above its crucial 28,250 mark. The broader markets too traded jubilantly throughout the session and ended the session with a gain of around a percentage point. The market breadth remained in favour of advances, as there were 1,657 shares on the gaining side against 1,318 shares on the losing side while 110 shares remain unchanged.

Finally, the BSE Sensex surged by 140.12 points or 0.50%, to 28262.01, while the CNX Nifty gained 36.90 points or 0.43% to 8,550.70.

The BSE Sensex touched a high and a low of 28334.06 and 28197.36, respectively. The BSE Mid cap index was up by 0.45%, while the Small cap index was up by 0.80%.

The top gainers on the Sensex were Wipro up by 5.26%, GAIL India up by 3.73%, Axis Bank up by 2.67%, BHEL up by 2.57% and Tata Motors up by 2.50%. On the flip side, Hindustan Unilever down by 5.27%, Hero MotoCorp down by 1.90%, HDFC down by 0.99%, TCS down by 0.87% and SBI down by 0.79% were the top losers.

On the BSE Sectoral front Consumer Durables up by 3.35%, Infrastructure up by 1.18%, Capital Goods up by 1.17%, Power up by 1.08% and Auto up by 0.98% were the top gainers, while FMCG down by 0.71% and IT down by 0.01% were the losing indices on BSE.

Meanwhile, in an attempt to ease the sourcing of bio-diesel, the Centre on Friday has allowed private bio-diesel manufacturers to sell directly to consumers like Indian Railways. Prior to this, only state-run oil firms and private companies with infrastructure investments of Rs 2,000 crore were allowed to market petrol, diesel or bio-diesel.

However, the Union Cabinet, chaired by Prime Minister Narendra Modi, gave its approval for amending the Motor Spirit (petrol) and High Speed Diesel (diesel) control order for Regulation of Supply, Distribution and Prevention of Malpractices dated December 19, 2005.

This amendment, which would relax Rs 2000 crore investment clause, would allow private bio-diesel manufacturers, their authorized dealers and joint ventures of oil marketing companies (OMCs) authorized by the Ministry of Petroleum & Natural Gas (MoP &NG) as 'dealers' and would also allow them the marketing /distribution functions for the limited purpose of supply of bio-diesel to consumers.

Notably, the amendment comes against the backdrop of problems faced in sourcing and financial difficulties faced by State-run companies. With this development, bulk users, such as the Indian Railways, can now source the fuel directly.

The CNX Nifty touched a high and low of 8,570.95 and 8,531.50 respectively.

The top gainers on Nifty were Wipro up by 5.30%, GAIL up by 3.78%, BHEL up by 3.12%, Ambuja Cements up by 3.03% and Axis Bank up by 2.89%. On the flip side, Hindustan Unilever down by 5.03%, BPCL down by 1.98%, Hero MotoCorp down by 1.78%, Asian Paints down by 1.54% and HDFC down by 1.13% were the top losers.

European Markets were trading in the green; UK's FTSE 100 was up by 0.10%, France's CAC was up by 0.13% and Germany's DAX was up by 0.44%.

The Asian equity benchmarks ended mostly in green on Monday, while Chinese shares plunged the most since 2008 as regulators cracked down on margin lending. Beijing’s efforts to put China’s economy on a more sustainable growth path are focusing on shifting from investment-intensive manufacturing jobs to the services sector, but clumsy attempts to force the transition could do more harm than good. China’s economic growth rate is likely to cool further this year, restrained by sluggish lending, a housing slump and weak global demand. The world’s second-largest economy is predicted to grow 7% in 2015, and slow further to 6.8% next year. The data is likely to show China’s economy expanded 7.2% in the final quarter of 2014, the weakest in 24 years. Japan’s industrial production fell to a seasonally adjusted -0.5%. Hong Kong Unemployment Rate remained unchanged at a seasonally adjusted 3.3%, compared to the preceding month.