Markets continue to remain in jubilant mood; Nifty holds above 8400 mark

Benchmark equity indices were trading jubilantly with gains of around one percent on sustained buying activities by both funds and retail investors on growing expectation of 50 basis points rate cut by Reserve Bank of India in its upcoming monetary policy review on June 2, 2015, which besides lifting banking shares high have also bolstered sentiments across Dalal Street. Notably, sentiment also remains positive ahead of the release of GDP data which is scheduled to be unveiled later in the day. Going from strength to strength, while Sensex is trading at striking distance of 27,800 mark, Nifty is comfortably gyrating past 8400 level. Meanwhile, broader indices too performing in line with larger counterparts were up with gains of around one percent.

On the global front, Asian shares rose on Friday as the regional investors remained fearful that the world’s best performing equity market was at the beginning of a major correction on growing expectations that the US Federal Reserve would raise interest rates this year. However, Japan's Nikkei inched up to a 15-year high and was on track for an 11-day winning streak and a fifth straight month of gains amid hopes for better shareholder returns.

Closer home, with buying being broad based in nature, most of the sectoral indices on BSE were holding into positive territory, however stocks from Consumer Durable counter was the only spoil sport. On the flip side, much of buying was witnessed by stocks belonging to Technology, IT and Banking counters. The overall market breadth on BSE was in the favour of advances which thumped declines in the ratio of 1362:1023; while 111 shares remained unchanged.

The BSE Sensex is currently trading at 27790.31, up by 283.60 points or 1.03% after trading in a range of 27467.23 and 27829.91. 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 1.31%, while Small cap index gained 0.94%.

The top gaining sectoral indices on the BSE were TECK up by 1.33%, IT up by 1.14%, Bankex up by 1.05%, Capital Goods up by 1.03%, INFRA up by 1.02% while, Consumer Durables down by 0.19% were the losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 2.42%, NTPC up by 2.19%, Maruti Suzuki up by 1.92%, Coal India up by 1.71% and Sun Pharma Inds. up by 1.68%. On the flip side, ONGC down by 1.33%, BHEL down by 0.62% and Vedanta down by 0.13% were the top losers.

Meanwhile, in a good news for the new airlines, the Civil Aviation Ministry would soon submit a draft note on the proposed changes in the controversial 5/20 norm to the Cabinet for approval. As per the present norms Indian carriers needs to be in operation for at least five years and have a fleet of 20 aircraft to be eligible to fly on international routes. By bringing in changes in the more than decade-old rule, the government seeks to address the imbalance between domestic and foreign carriers.

The Ministry of Civil Aviation has however proposed a complicated formula replacing 5/20 norms, in which domestic flying credits would still be needed for new airlines to fly overseas. As per the proposed norms, a new airline would be eligible to apply for international operations once it has operated on domestic routes and deployed capacity equivalent to at least 200 domestic flying credits (DFCs). On reaching the 300 DFC milestone, the air carrier can approach the government for being designated on a long haul international route of more than 6 hours flying time. Civil Aviation Minister Ashok Gajapati Raju had earlier said that sooner the 5/20 rule was thrown out the better.

There is wide difference among the different players of the industry over change of rules as the Federation of Indian Airlines, which has IndiGo, SpiceJet, Jet Airways and GoAir as its members has objected to any relaxations, while new entrants Vistara and AirAsia India strongly pitched for scrapping of the rule. The CNX Nifty is currently trading at 8410.20, up by 91.20 points or 1.10% after trading in a range of 8305.70 and 8420.75. There were 45 stocks advancing against 5 stocks declining on the index.

The top gainers on Nifty were BPCL up by 3.50%, Asian Paints up by 3.18%, Ambuja Cement up by 2.91%, Indusind Bank up by 2.23% and ACC up by 2.20%. On the flip side, NMDC down by 2.51%, PNB down by 1.50%, ONGC down by 1.33%, BHEL down by 0.67% and Vedanta down by 0.33% were the top losers.

Asian markets were trading mostly lower; with Shanghai Composite down by 40.38 points or 0.87% to 4,579.89; Straits Times down by 29.52 points or 0.86% to 3,388.25; Taiwan Weighted down by 11.77 points or 0.12% to 9,701.07; Jakarta Composite down by 10.52 points or 0.2% to 5,226.88; Hang Seng down by 3.61 points or 0.01% to 27,450.70 and FTSE Bursa Malaysia KLCI down by 3.34 points or 0.19% to 1,752.22.

On the flip side, KOSPI Index was up by 3.91 points or 0.19% to 2,114.80 and Nikkei 225 gained 11.69 points or 0.06% to 20,563.15

European markets got off to a positive start; with France’s CAC trading higher by 3.99 points or 0.08% to 5,141.82; UK’s FTSE 100 trading higher by 6.82 points or 0.1% to 7,047.74 and  Germany’s DAX trading higher by 16.84 points or 0.14% to 11,694.41