Post Session: Quick Review

Indian markets made a positive start of the new week with benchmarks making a rebound from last week's weakness; although the global environment remained gloomy but the local traders rejoiced some upbeat domestic economic data of strong IIP and steady inflation (CPI) numbers released on Friday after the market hours. The strong performance of IIP was aided by capital goods sector which performed well on the bourses too along with healthcare, auto and oil & gas sectors. Traders also got some support with report that the finance ministry has loosened the purse strings and asked ministries and departments to start spending with focus on capital expenditure as it looks to lift growth with private sector investment yet to get underway. The key areas are roads and shipping along with rural development and agriculture.

In the global markets, Asian markets went through a bloodbath, tailing the weakness in US markets after talks between Greece and its creditors broke down without a deal on bailout aid. Talks in Brussels between Greece and its creditors fell apart after just 45 minutes on Sunday. Later the European markets too made a weak start led by Greece. The latest failure to find a compromise to unlock as much as 7.2 billion euros in aid for Greece’s anti-austerity government was accompanied by warnings about the risk of the country’s exit from the 19-nation euro.

Back home, traders continued getting good economic data one after another that helped them strengthen through the day. After a good IIP and inline CPI data, the Wholesale Price Index (WPI) inflation came at -2.36% in May, compared to -2.65% (provisional) for the previous month, mainly on the back of plunging oil and manufacturing goods prices, even though food prices increased. Inflation, as measured on the WPI, has been in the negative zone since November 2014. Back on street, in the early deals the trade looked a bit cautious on Greece concern, but later the markets picked up pace, though there were instances of profit taking during the day and towards the end, but the major averages despite the volatility of last moment managed to defend the 8000 (Nifty) and 26500 (Sensex) levels, posting gains of around half a percent. The broader markets too lost their way and made a mixed closing, while consumer durables, metals, power and banking made a lower ending.

The BSE Sensex ended at 26549.46, up by 124.16 points or 0.47% after trading in a range of 26307.84 and 26728.60. There were 18 stocks on gainers side against 12 stocks on the decliners side on the index. (Provisional)

The broader indices made a mixed closing; the BSE Mid cap index was down by 0.15%, while Small cap index higher by 0.35%.(Provisional)

The top gaining sectoral indices on the BSE were Auto up by 1.05%, Oil & Gas up by 0.81%, TECK up by 0.49%, Capital Goods up by 0.42%, INFRA up by 0.30%, while Consumer Durables down by 0.99%, Metal down by 0.71%, Bankex down by 0.56%, Power down by 0.54%, PSU down by 0.26% were the losing indices on BSE.(Provisional)

The top gainers on the Sensex were Sun Pharma Inds up by 2.73%, Bajaj Auto up by 2.05%, Mahindra & Mahindra up by 2.03%, HDFC up by 1.66% and ONGC up by 1.25%. On the flip side, Hindalco down by 2.31%, Vedanta down by 1.63%, SBI down by 1.36%, HDFC Bank down by 0.61% and Tata Power down by 0.55% were the top losers.(Provisional)

Meanwhile, deflationary trend continued for the seventh month in a row though some consolidation sign appeared with Wholesale Price Index (WPI) inflation coming at (-) 2.36% in May, compared to -2.65% (provisional) for the previous month mainly on the back of plunging oil and manufacturing goods prices, even as food prices increased. Inflation, as measured on the Wholesale Price Index (WPI), has been in the negative zone since November 2014. Build up inflation rate in the financial year so far was 0.91% compared to a build up rate of 0.94% in the corresponding period of the previous year.

Component wise, inflation in primary articles, having weight of 20.12% rose by 1.3% to 244.9 (provisional) from 241.8 (provisional) for the previous month. In primary articles the index for ‘Food Articles’ group rose by 0.5% to 253.9 (provisional) from 252.7 (provisional) for the previous month. The index for  ‘Non-Food Articles’ group rose by 5.1% to 213.9 (provisional) from 203.5 (provisional) for the previous month, while the index for ‘Minerals’ group rose by 0.4 percent to 247.7 (provisional) from 246.6 (provisional). Fuel & Power, the index for this major group having weight of 14.91% rose by 3.0% to 189.8 (provisional) from 184.2 (provisional) for the previous month.

Manufactured products index which has the highest weightage of 64.97%, witnessed 0.2 percent to 154.1 (provisional) from 153.8 (provisional) for the previous month. In manufactures products, the index for ‘Food Products’ group rose by 1.1 percent to 171.7 (provisional) from 169.8 (provisional), the index for ‘Beverages, Tobacco & Tobacco Products’ group declined by 0.2 percent to 203.0 (provisional) from 203.5 (provisional), the index for ‘Textiles’ group declined by 0.1 percent to 140.1(provisional) from 140.3 (provisional), the index for ‘Paper & Paper Products’ group declined by 0.2 percent to 152.8 (provisional) from 153.1 (provisional), the index for ‘Non-Metallic Mineral Products’ group declined by 0.4 percent to 176.9 (provisional) from 177.6 (provisional).

On the other hand, the index for ‘Wood & Wood Products’ group rose by 0.5 percent to 192.9 (provisional) from 192.0 (provisional), the index for ‘Leather & Leather Products’ group rose by 1.2 percent to 143.5 (provisional) from 141.8 (provisional), the index for ‘Rubber & Plastic Products’ group rose by 0.5 percent to 148.8 (provisional) from 148.1 (provisional), the index for ‘Chemicals & Chemical Products’ group rose by 0.1 percent to 150.9 (provisional) from 150.7 (provisional) and the index for ‘Transport, Equipment & Parts’ group rose by 0.1 percent to 137.6 (provisional) from 137.4 (provisional).

Meanwhile, for the month of March, 2015, the final Wholesale Price Index for ‘All Commodities’ and annual rate of inflation remained unchanged at its provisional level of 176.1 and -2.33 percent respectively.

The CNX Nifty ended at 8013.90, up by 31.00 points or 0.39% after trading in a range of 7944.85 and 8057.70. 25 stocks gained against 25 declines on the index.(Provisional)

The top gainers on Nifty were Cairn India up by 3.85%, Idea Cellular up by 2.99%, Sun Pharma Inds up by 2.97%, Mahindra & Mahindra up by 2.29% and HDFC up by 2.03%. On the flip side, Power Grid Corpn down by 2.89%, Bank Of Baroda down by 2.69%, ACC down by 2.28%, Hindalco down by 2.10% and Indusind Bank down by 2.00% were the top losers.(Provisional)

The European markets were trading lower, Germany’s DAX plunged by 157.39 points or 1.41% to 11,039.10, UK’s FTSE 100 lost 54.68 points or 0.81% to 6,730.24 and France’s CAC was down by 49.55 points or 1.01% to 4,851.64.

Asian markets closed in red on Monday, on concerns about Greece’s future in the euro zone after debt reform talks between Athens and its creditors collapsed at the weekend. The Bank of Japan remains on course to expand its monetary stimulus in October, but some marketmen have pushed back their forecasts for more easing after recent upbeat data suggested the economy was gaining speed. Japan’s output gap narrowed in January-March, according to calculations based on revised gross domestic product data, in an encouraging sign for the Bank of Japan’s inflation target. The output gap in the first quarter was minus 1.6 percent. That compares with a minus 2.4 percent gap in the fourth quarter of last year. Japanese tertiary industry activity index fell to a seasonally adjusted -0.2%, from -1.0% in the preceding month. Indonesia posted a surprisingly strong May trade surplus but also another sharp drop in imports, which could reflect weak consumer demand ahead of the Muslim fasting month of Ramadan. There was a trade surplus of $950 million, the sixth straight surplus and more than double expectations, evidence that the current account deficit should narrow in the second quarter. A large current account deficit has been one of Indonesia’s top economic problems and at times has pressured the rupiah, which is emerging Asia’s weakest currency this year.