Benchmarks remain in high spirit; trade with gains of over 1%

Going strength to strength, local equity markets were trading with gains of over 1%, which lifted both Sensex and Nifty above psychologically crucial 27,400 and 8,250 levels respectively on sustained buying activities by market-participants after previous sessions’ sharp drubbing which took benchmark indices near four month closing low. The broader indices were trading with gains in the range of 0.95-1.65%.

Notably, somber economic data too 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 bounced off lows 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) showed factory activity in China contracted at its fastest rate in a year in April as demand faltered and deflationary pressures persisted.

Closer home, most of the sectoral indices on BSE were holding in positive territory, nevertheless stocks from Realty, Consumer Durables and Oil & Gas counters were the prominent gainers of the session. Meanwhile, auto stocks also were 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 declines in the ratio of 1771:629; while 95 shares remained unchanged.

The BSE Sensex is currently trading at 27362.77, up by 351.46 points or 1.30% after trading in a range of 27159.45 and 27386.60. There were 27 stocks advancing against 3 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.98%, while Small cap index surged by 1.66%.

The top gaining sectoral indices on the BSE were Realty up by 2.53%, Consumer Durables up by 2.24%, Oil & Gas up by 2.21%, PSU up by 1.89%, FMCG up by 1.82%

The top gainers on the Sensex were ONGC up by 5.19%, Bajaj Auto up by 5.16%, Mahindra & Mahindra up by 3.86%, Cipla up by 3.52% and Hindalco up by 3.33%. On the flip side, Tata Motors down by 1.41%, Larsen & Toubro down by 0.58% and Wipro down by 0.29% were the top losers.

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, rationalisation 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.

The CNX Nifty is currently trading at 8293.10, up by 111.60 points or 1.36% after trading in a range of 8220.45 and 8294.90. There were 46 stocks advancing against 4 stocks declining on the index.

The top gainers on Nifty were ONGC up by 5.30%, Bajaj Auto up by 5.20%, Mahindra & Mahindra up by 3.78%, Hindalco up by 3.73% and Cipla up by 3.60%. On the flip side, Tata Motors down by 1.47%, Tech Mahindra down by 1.05%, Larsen & Toubro down by 0.56% and Wipro down by 0.34% were the top losers.

Asian markets were trading mostly higher; with KOSPI Index trading higher by 5.06 points or 0.24% to 2,132.23; Nikkei 225 trading higher by 11.62 points or 0.06% to 19,531.63; Shanghai Composite trading higher by 13.29 points or 0.3% to 4,454.94; Taiwan Weighted trading higher by 24.99 points or 0.25% to 9,845.04; Jakarta Composite trading higher by 66.86 points or 1.31% to 5,153.28.

On the flip side, FTSE Bursa Malaysia KLCI down by 24.66 points or 1.34% to 1,818.27; Hang Seng down by 12.22 points or 0.04% to 28,120.78 and Straits Times down by 6.88 points or 0.2% to 3,480.51.