Post Session: Quick Review

Indian equity markets, rising for eight consecutive sessions and hitting record high for fifth straight session on Tuesday, puffed up gains of around a percent to conclude past psychologically crucial 29,550 (Sensex) and 8,900 (Nifty) levels respectively. Sentiment turned bullish after US President Barack Obama, in a measure to bolster trade with India, pledged for investments and loans worth $4 billion by American agencies. Additionally, hopes of rate cut after Chief Economic Advisor, Arvind Subramanian underscored that the central bank may further ease the interest rates as improvement on price front has provided room for monetary easing along with encouraging comments from Finance minister also added to the positive milieu.

In an encouraging development for the economy, Finance Minister Arun Jaitley underscored fiscal deficit targets for current year, which was once termed as 'difficult' is likely to be achieved. The government has pegged fiscal deficit target at 4.1% of the GDP for the current year. Besides, continued inflow of funds from foreign investors also got the bulls going. Provisional exchange data showed Foreign institutions have bought Indian shares worth $977.3 million so far this year, purchased Rs 20.2 billion ($328.75 million) on Friday. Much of the buying which came in the last hour of trade lifted the frontline indices higher. Nevertheless, broader indices also participated into the rally, but underperformed frontline indices as both Midcap and Smallcap indexes went home with gains in the range of 0.50%-0.75%.

Broader gains were capped as drug makers fell ahead of earnings results and after Ranbaxy Laboratories lost rights to launch a generic version of AstraZeneca Plc's blockbuster heartburn drug Nexium to Teva Pharmaceutical Industries TEVA, raising fears about increased competition from abroad.

On the global front, Asia stocks were mostly up on Tuesday as investors brushed aside worries that a victory for the anti-austerity Syriza party in Greece could set up a clash between the country and its creditors. Notably, trading volumes in Japan remained subdued, coming to under 2.2 billion shares, with the U.S. central bank due to deliver its latest statement on monetary policy this week. Meanwhile, European stocks declined from a seven-year high, snapping an eight-day winning streak, as Siemens AG and Royal Philips NV posted disappointing earnings.

Closer home, most of the sectoral indices on BSE concluded into positive territory, however stocks from Information Technology, Technology and Metal counters were the prominent losers of the session. On the flip side, maximum demand was witnessed by stocks from Banking, Capital Goods and Fast Moving Consumer Goods counters. While hopes of further rate cut by RBI in its monetary policy on February 3, 2015 lifted banking stocks higher, Capital goods stocks rose after U.S. President Barack Obama and Indian Prime Minister Narendra Modi unveiled a deal aimed at unlocking billions of dollars in nuclear trade and deepening defence ties. The overall market breadth on BSE was in the favour of decliners, which thumped advances in the ratio of 1406:1519, while 117 shares remained unchanged (Provisional).

The BSE Sensex ended at 29571.04, up by 292.20 points or 1.00% after trading in a range of 29286.09 and 29618.59. There were 18 stocks advancing against 12 stocks declining on the index. (Provisional)

The broader indices ended in the green; the BSE Mid cap index was up by 0.79%, while Small cap index up by 0.51%. (Provisional)

The gaining sectoral indices on the BSE were Bankex up by 2.30%, Capital Goods up by 1.84%, Auto up by 1.24%, FMCG up by 1.14% and Realty up by 1.03% while, IT down by 1.66%, TECK down by 1.07%, Metal down by 0.60% and PSU down by 0.12% were the few losing indices on BSE. (Provisional)

The top gainers on the Sensex were Axis Bank up by 4.81%, Cipla up by 4.50%, ICICI Bank up by 3.87%, Tata Motors up by 3.33% and ITC up by 3.01%. On the flip side, Dr. Reddys Lab down by 4.25%, Infosys down by 3.53%, Mahindra & Mahindra down by 3.11%, Coal India down by 2.75% and Hindustan Unilever down by 2.45% were the top losers. (Provisional)

Meanwhile, igniting hope for India's skilled workers, President Barack Obama has assured Prime Minister Narendra Modi of looking into country's concerns on the H-1B visa issue as part of his comprehensive immigration reform.

Further, the Prime Minister also acknowledged President's ongoing efforts to work with Congress in pursuit of comprehensive immigration reform. While, Obama assured that PM that his administration would be in touch with the Indian government on issues related to H-1B visas, popular among Indian techies. 

Notably, Obama had in November bypassed the Congress and unveiled immigration reforms to protect millions of illegal immigrants from deportation. The reforms have yet to be completely implemented.

This development definitely is encouraging for the information technology and outsourcing industry, which earns billions of dollars sending Indian engineers and programmers to the U.S and wants America to raise the ceiling on the number of skilled-worker visas it issues every year. Presently, the ceiling for H-1B visas is 65,000 per year, a quota that is usually reached in a matter days.

India VIX, a gauge for markets short term expectation of volatility surged 2.34% at 18.30 from its previous close of 17.88 on Friday. (Provisional)

The CNX Nifty ended at 8910.50, up by 74.90 points or 0.85% after trading in a range of 8825.45 and 8925.05. There were 28 stocks advancing against 22 stocks declining on the index. (Provisional)

The top gainers on Nifty were Axis Bank up by 4.77%, Cipla up by 4.34%, ICICI Bank up by 3.45%, Asian Paints up by 3.29% and ITC up by 3.06%. On the flip side, Dr. Reddys Lab down by 4.10%, Cairn India down by 3.72%, Infosys down by 3.55%, Coal India down by 3.05% and Mahindra & Mahindra down by 2.75% were the top losers. (Provisional)

European Markets were trading in the red; France's CAC was down by 0.64%, Germany's DAX was down by 0.65% and UK's FTSE 100 was down by 0.33%.

The Asian equity benchmarks ended mostly in green on Tuesday, while Chinese stocks fell for the first time in six days, led by financial and commodity companies, after industrial profits slumped. Japan’s exports grew the most in a year in December, helped by a weak yen and a pick-up in overseas demand led by the United States, an encouraging sign for the recession-hit economy even as doubts persist about the strength of global consumption. The 12.9% year-on-year rise in exports marked a fourth straight month of growth, supported by shipments of cars to the United States and of electronics parts to China. A recovery in exports, which has been a soft spot in the world’s third-largest economy, could be a source of comfort for Prime Minister Shinzo Abe, who is battling to re-kindle growth after an April sales tax hike drove Japan into a recession. Imports rose less than expected, leaving Japan with a trade deficit for a record 30th month in a row. Japan’s (corporate services price index) CSPI remained unchanged at a seasonally adjusted annual rate of 3.6%, from 3.6% in the preceding month. Singaporean Industrial Production rose to an annual rate of -1.9%, from -2.1% in the preceding month whose figure was revised up from -2.8%.