Late hour recovery help benchmarks to extend their winning streak to seventh day

Indian equity benchmarks extended their rally to seventh straight session and accumulated gains of around half a percent on Thursday, on account of hectic buying activity witnessed in the last leg of trade, as investors piled up position in the run-up to budget, which is scheduled to be presented on February 28. Earlier, after a positive start, markets entered into negative terrain in noon deals as investors booked some of their profits at higher levels. The indices even went on to test important psychological 29,200 (Sensex) and 8,800 (Nifty) levels, but the key gauges got strong support around those intraday low levels as they convalesced from thereon.

Recovery which took place in last hour of trade mainly helped benchmarks to regain their positive trajectory as investors remained hopeful of faster reforms in the government’s 2015-16 fiscal budget, after global rating agency Fitch said that it was expecting a slew of reforms in the upcoming Union Budget and any deviation from fiscal consolidation path could be a negative for its investment grade rating for India. Some support also came with report that foreign institutional investors were net buyers in equities after they bought equities worth Rs 2,188 crore on Wednesday, as per the provisional stock exchange data.

On the global front, European counters which made a somber start, hit by a slide in oil prices and a mixed batch of corporate results, with disappointing updates from companies, including utility Centrica and airline Air France-KLM, pared most of their losses and were trading mostly in the green in early deals. Lunar New Year holidays kept most of the regional markets away from the action, though the Japanese markets extending its gains surged to its fifteen months high.

Back home, buying in metal counter too supported the sentiments with companies getting coal mines allocated under the ongoing auction. Jindal Steel and Power surged over 25% on retaining its two coal blocks Gare Palma IV/2 and Gare Palma IV/3 in Chhattisgarh for a surprisingly low winning bid of Rs 108 per tonne. Coal from these blocks will primarily be linked to JSPL's 1000 MW Tamnar-1 power plant in Chhattisgarh. Shares related to jewellery sector too remained on buyers’ radar as the Reserve Bank of India (RBI) permitted banks to resume lending against gold to jewellers. The RBI has also lifted the ban on imports of gold coins and medallions. On the flip side, Stocks related to cement space edged lower after Ambuja Cement reported less-than-expected profit in its fourth quarter ended December 31, 2014 and as Minister of Road Transport and Highways Nitin Gadkari slamming the cement industry for indulging in cartelization said that he will be approaching Prime Minister Narendra Modi over the issue of cartelization by the industry.

The NSE’s 50-share broadly followed index -- Nifty -- rose by around thirty points to end near the psychological 8,900 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex - surged by over one hundred and forty points to finish above the psychological 29,400 mark. Moreover, broader markets too witnessed volatility but managed to keep their head above water. The market breadth remained in the favour of decliners, as there were 1,379 shares on the gaining side against 1,508 shares on the losing side while 102 shares remain unchanged.

Finally, the BSE Sensex surged by 142.01 points or 0.48% to 29462.27, while the CNX Nifty gained 26.20 points or 0.30% to 8895.30.

The BSE Sensex touched a high and a low of 29522.86 and 29108.15, respectively. The BSE Mid cap index was up by 0.04%, while Small cap index up by 0.10%.

The top gainers on the Sensex were Sesa Sterlite up by 6.95%, Hindalco up by 3.07%, Tata Power up by 2.56%, Tata Steel up by 2.29% and Mahindra & Mahindra up by 2.28%. On the flip side, Wipro down by 1.36%, Tata Motors down by 1.10%, ICICI Bank down by 1.08%, SBI down by 1.05% and ITC down by 0.87% were the top losers.

The top gaining sectoral indices on the BSE were Metal up by 3.82%, Capital Goods up by 1.36%, Realty up by 1.06%, Power up by 0.86% and IT up by 0.79% while, FMCG down by 0.90%, Bankex down by 0.60%, Healthcare down by 0.08% and Auto down by 0.01% were the losing indices on BSE.

Meanwhile, Minister of Road Transport and Highways Nitin Gadkari pitching for greater transparency and faster decision making at the National Highways Authority of India (NHAI), has said that the government is planning to revamp the roads body.

NHAI which became operational in February 1995 and is responsible for the development, maintenance and management of national highways, witnessed its last restructuring in 2009 to enhance its institutional capacity. It was done to make it a multi-disciplinary professional body with quality financial management and contract management expertise.

The minister also emphasised on the need for reducing project costs and said, “We want to reduce the cost of the project and if we want to do that then we have to reduce the cost of material used for the project. Adding further, he slammed the cement industry for indulging in “cartelization” and said that it was pushing up costs for roads and highway projects. He also said that he will be approaching Prime Minister Narendra Modi over the issue of “cartelization” by the cement industry.

The government had targeted awarding 8,000 km of road projects during the current financial year, majority of which will be built on EPC (engineering, procurement and construction) basis and so far it has been able to award 7,000 km of projects.

The CNX Nifty touched a high and low of 8913.45 and 8794.45 respectively.

The top gainers on Nifty were Jindal Steel & Power up by 25.75%, Sesa Sterlite up by 6.75%, Hindalco up by 3.03%, Tata Power up by 2.38% and Larsen & Toubro up by 2.12%. On the flip side, Bank Of Baroda down by 2.54%, ACC down by 2.31%, Tech Mahindra down by 2.15%, Grasim Industries down by 2.10% and Ambuja Cement down by 1.87% were the top losers.

European Markets were trading in the green; Germany’s DAX gained 0.04% and France’s CAC was up 0.21%, while UK’s FTSE 100 was down by 0.08%.

The only major Asian market trading today ‘Japanese stock exchange’ ended in green on Thursday, as data showed the country’s exports grew at the fastest annual pace since late 2013 as a weaker yen made it more competitive. Markets in China, Indonesia, Malaysia, Philippines, Singapore, Taiwan and South Korea were all shut on account of trading holiday. Japan’s annual exports in January jumped the most since late 2013 in an encouraging sign a weak yen is finally boosting the nation’s all-important export engine and helping the economy crawl out of recession. The 17% year-on-year gain in exports marked the fifth straight month of increase, supported by shipments of cars to the United States and of electronics parts to Asia. The ministry officials stated that exports are on a firm footing, adding that special factors helped boost shipments such as a rebound from last year’s Chinese New Year holidays which fell in January, and extreme cold weather which hit the US economy a year ago.

Japan’s index of leading economic indicators rose to a seasonally adjusted 105.6, from 105.2 in the preceding month while Japan’s All Industries Activity Index fell to a seasonally adjusted -0.3%, from 0.0% in the preceding month whose figure was revised down from 0.1%. Japan’s trade balance rose to a seasonally adjusted -0.41T, from -0.62T in the preceding month whose figure was revised up from -0.71T.

Nikkei 225 gained 65.62 points or 0.36% to 18264.79.