Post Session: Quick Review

Local equity markets, snapping two consecutive sessions of losing streak ended upbeat on Monday with gains of over 1.50%, which lifted both Sensex and Nifty above psychologically crucial 27,450 and 8,300 levels respectively. Fresh positions built up by participants, following the beginning of May series in the derivatives segment and value-based buying in select counters mainly lifted the benchmarks higher, which gradually gaining strength concluded at day’s highest point. Meanwhile, the session also proved splendid for broader indices, which went home with gains of over 1.75% Clarification on Minimum Alternate Tax (MAT) on capital gains mainly bolstered the sentiment. Tax liability on foreign investors on account of MAT on capital gains could be much lower than Rs 40,000 crore estimated earlier, provided the required impetus to the markets after two sessions of drubbing.

Somber economic data failed to dampen the spirit of local equity markets. On the macro-front, following the solid readings seen in March, the Indian manufacturing recorded a growth slowdown during April on account of weaker pace of total new orders. The headline HSBC India Purchasing Managers’ Index (PMI), compiled by Markit, though slowed to 51.3 in April from 52.1 in March, marked its eighteen month of expansion since a figure above 50 indicates that the sector is expanding, while a figure below that level means contraction.

On the global front, Asian stocks ended mostly higher on Monday as weak China factory activity reinforced views that Beijing will roll out fresh support measures soon for the world’s second largest economy. The weak China data follows a string of disappointing economic news in recent weeks which has forced Beijing to roll out a variety of stimulus measures this year including boosts for bank lending and lower down payments for property buyers. The HSBC/Markit Purchasing Managers' Index (PMI) fell to 48.9 in April - the lowest level since April 2014 - from 49.6 in March, as demand faltered and deflationary pressures persisted. Meanwhile, European shares rose on Monday, led higher by Germany after upbeat factory activity, while the dollar steadied following signs the U.S. economy may be emerging from a recent soft patch.

Closer home, most of the sectoral indices on BSE concluded into positive territory, stocks from PSU, Oil & Gas and Realty counters were the top gainers of the session. Meanwhile, auto stocks remained in limelight after reporting their monthly sales figures. Among auto stocks, Ashok Leyland stocks soared over 2% after the company reported 43% rise in April sales, while Hero MotoCorp rose 0.80% despite reporting 6.61% fall in its total sales at 5,33,305 units in April 2015. The overall market breadth on BSE was in the favour of advances which thumped advances in the ratio of 1954:834; while 107 shares remained unchanged.

The BSE Sensex concluded at 27490.59, up by 479.28 points or 1.77% after trading in a range of 27159.45 and 27537.85. There were 28 stocks advancing against 2 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 1.33%, while Small cap index up by 2.13%. (Provisional)

The top gaining sectoral indices on the BSE were Oil & Gas up by 3.74%, PSU up by 3.17%, Realty up by 2.71%, Healthcare up by 2.36%and Power up by 2.19%, while there were no losers on the index. (Provisional)

The top gainers on the Sensex were ONGC up by 7.72%, Bajaj Auto up by 7.50%, Cipla up by 5.74%, Mahindra & Mahindra up by 4.95% and BHEL up by 4.09%. On the flip side, ICICI Bank down by 0.60% and Tata Motors down by 0.23% were the only losers. (Provisional)

Meanwhile, the guidelines for Narendra Modi’s ambitious smart cities project, which just got approved previous week is expected to be finalized next week. The guideline for 48,000 crore mega project, which is aimed at recasting the urban landscape is likely to be notified next week after its finalization.

Post the guidelines have been announced, the states and UTs will be asked to nominate name of cities for ‘Smart City Challenge Competition’ and selected ones will get a central fund of Rs 100 crore each years for next five years. The competition will be carried out by Bloomberg Philanthropes, which has been involved in conducting similar competitions in various countries.

The evaluation parameters of selecting these cities will be based upon four key areas – Swachh Bharat (sanitation), Make in India (ease of doing business), good governance (modern accounting system, rationalization of property taxes and e-governance.

Further as per the plan, in total of 20 cities will be selected this year, while 40 each will be selected in the coming 2 years, thereby paving the way for NDA’s government ambitious 100 smart cities project.

Lastly, these 100 cities will be a mix of brown-field (old) and Greenfield ventures that would be implemented through an area based approach including retrofitting and redevelopment.

India VIX, a gauge for markets short term expectation of volatility decreased 0.34% at 17.16 from its previous close of 17.22 on Thursday. (Provisional)

The CNX Nifty settled at 8331.95, up by 150.45 points or 1.84% after trading in a range of 8220.45 and 8346.00. There were 45 stocks advancing against 5 stocks declining on the index. (Provisional)

The top gainers on Nifty were ONGC up by 8.45%, Bajaj Auto up by 7.26%, Cipla up by 5.97%, Mahindra & Mahindra up by 5.33% and HCL Tech up by 4.93%. On the flip side, Tech Mahindra down by 1.67%, ICICI Bank down by 0.42% and Tata Motors down by 0.01% were the few losers. (Provisional)

European Markets were trading in the green; Germany's DAX rose 1.19% and France's CAC was up by 0.63%.UK’s FTSE remained closed for trade on account of ‘Holiday’.

The Asian markets closed mostly in green on Monday, as weak China factory activity reinforced views that Beijing will roll out fresh support measures soon for the world’s second-largest economy. Japanese stock exchange was closed today on account of ‘Greenery Day’ holiday while Malaysian stock exchange was closed on account of ‘Wesak Day’ holiday. China’s factories suffered their fastest drop in activity in a year in April as new orders shrank, hardening the case for fresh stimulus measures to halt a slowdown in the world’s second-largest economy. The latest indication of deepening factory woes raises the risk that second-quarter economic growth may dip below 7 percent for the first time since the depths of the global crisis, adding to official fears of job losses and local-level debt defaults. The HSBC/Markit Purchasing Managers’ Index (PMI) fell to 48.9 in April - the lowest level since April 2014 - from 49.6 in March, as demand faltered and deflationary pressures persisted. Singaporean Unemployment Rate fell to 1.8%, from 1.9% in the preceding quarter. Indonesian Inflation rose to a seasonally adjusted 6.79%, from 6.38% in the preceding month.