Post Session: Quick Review

Indian markets despite showing the volatility of the F&O series expiry bounced back on Thursday, recovering more than what they had lost in last session, with Nifty reclaiming the 8400 and Sensex the 27900 mark. Markets got an initial push with an UNCTAD report that FDI inflows in India rose 22 percent to $34 billion in 2014, and the upward trend is likely to continue against the backdrop of a push to manufacturing. The UN report also said that global foreign direct investment is expected to rebound in 2015 after falling 16 per cent last year due to a fragile world economy and political and military crises. Also, making a robust pitch for investments in India, Finance Minister Arun Jaitley requested lengthy-time period US buyers to start out investing without any delay as India’s progress story is on a agency footing and all excellent points are underneath the federal government’s lively consideration.

On the global front, after the slump in the US markets the Asian indices followed the trend and most of the indices in the region ended in red, with Chinese market suffering sharpest cut of over three percent, as Greece and its creditors broke off talks in Europe without reaching a deal. Hopes that Greece was on the verge of an agreement to release €7.2bn in desperately-needed bailout funding were dashed on Wednesday night after Alexis Tsipras, Greece's prime minister, failed to reach a deal after hours of talks with creditors in Brussels. Later the European markets extending a selloff made a soft start but recovered eyeing another round of Greek bailout talks. Greece’s need for a deal is growing more urgent as it faces both an expiry of its current bailout package and a loan repayment deadline on June 30.

Back home, the trade turned jubilant for the markets mainly on short covering before the expiry of the F&O series, while in the last leg of trade there were some reports of the latest round of technical talks ahead of an emergency meeting in Greece drawing to some conclusion. On the domestic front, the marketmen were enthused by Prime Minister Narendra Modi unveiling three mega flagship schemes 100 smart cities, Atal Mission for Rejuvenation and Urban Transformation (AMRUT) and Housing for All, aimed at developing cities and towns as “new engines for growth”.  Venkaiah Naidu, Minister for Urban Development said that Centre to spend Rs 48,000 crore on smart cities to be developed via PPP model and an equal amount of money has to be spent by the states. On the sectoral front, capital goods, power, realty and auto ended higher by over a percent, while the rupee stability weighed on IT and tech counters which lost over half a percent each. Auto stocks continued moving higher supported by report from engineering exporters' body EEPC, which said automobile exports to Sri Lanka jumped nearly four-fold to $56.54 million in May from $14.58 million in the same month last year. Italy and Spain too provided traction to the exports, though Mexico, the UK, Algeria and Bangladesh witnessed a major slowdown in shipments.

The stable June series ended higher by over a percent for both the major benchmark indices, though there was not much movement on the broader indices and they snapped the series on a flat note. Nifty rollovers were recorded at around 56.20. In stock specific movement, while Reliance Industries and Hindalco posted gains in double digit, JP Associates, Unitech and Sun TV etc. lost in excess of 25% for the series.

The BSE Sensex ended at 27930.50, up by 200.83 points or 0.72% after trading in a range of 27635.76 and 27962.21. There were 18 stocks advancing against 12 stocks declining on the index. (Provisional)

The broader indices too ended in green; the BSE Mid cap index was up by 0.71%, while Small cap index ended higher by 0.29%.(Provisional)

The top gaining sectoral indices on the BSE were Capital Goods up by 2.41%, Power up by 1.18%, Realty up by 1.10%, Auto up by 1.07%, INFRA up by 0.98%, while IT down by 0.92%, TECK down by 0.59%, FMCG down by 0.52% and Consumer Durables down by 0.10% were the losing indices on BSE.(Provisional)

The top gainers on the Sensex were Bajaj Auto up by 4.68%, Larsen & Toubro up by 3.74%, GAIL India up by 3.11%, HDFC up by 2.37% and HDFC Bank up by 2.26%. On the flip side, Wipro down by 1.91%, Cipla down by 1.70%, ONGC down by 1.65%, Hindustan Unilever down by 1.37% and ICICI Bank down by 0.79% were the top losers.(Provisional)

Meanwhile, giving some cheers to the government and policy makers despite the concerns of looming US rate hikes, the “World Investment Report 2015” released by the United Nations Conference on Trade and Development (UNCTAD) has said that India is among the top 10 countries to attract high foreign direct investment (FDI) in 2014. India’s investment inflows grew 23 percent whereas global inflows reduced 16 percent last year. In 2014, the country received $34 billion in comparison to $ 45 billion in 2007. The report further highlighted that the upward trend is likely to continue against the backdrop of a push to manufacturing as part of the 'Make In India' initiative.

India ranked 6th among the most promising investor economies and ranked 3rd among top 10 prospective home economies. However, between 2005 and 2009, India's ranking in the list of most favoured investment location had fallen. UNCTAD further said that in the manufacturing sector in South Asia, FDI success stories have come up, with India's automotive industry showing how large-scale inflows can reshape the trajectory of industrial progress in low-income countries. The country accounted for the majority of greenfield investment projects announced by global automakers and first-tier parts suppliers in South Asia during 2013-14, including 12 projects of above $100 million.

The UNCTAD's report has also said that global foreign direct investment is expected to rebound in 2015 after falling 16 per cent last year due to a fragile world economy and political and military crises. FDI flows worldwide dropped to $1.23 trillion (about 1.1trillion euros) in 2014, largely due to shaky investor confidence. The report however forecast an 11 percent rise in FDI this year to $1.4trillion, spurred by higher investments by multinational organisations.

Asia drew a total of $465bn in FDI, the biggest recipients of overseas investment after China were Hong Kong at $103bn, the United States at $92bn, followed by Britain, Singapore, Brazil, Canada, Australia, India and the Netherlands.

The CNX Nifty ended at 8415.65, up by 54.80 points or 0.66% after trading in a range of 8329.50 and 8423.15. There were 31 stocks advancing against 18 stocks declining on the index.(Provisional)

The top gainers on Nifty were Bajaj Auto up by 4.91%, Larsen & Toubro up by 3.51%, Cairn India up by 3.27%, Indusind Bank up by 2.83% and GAIL India up by 2.50%. On the flip side, Tech Mahindra down by 2.75%, Wipro down by 2.18%, ONGC down by 1.54%, Cipla down by 1.47% and Hindustan Unilever down by 1.07% were the top losers.(Provisional)

European Markets were trading cautiously but in positive territory, UK’s FTSE 100 gained 4.62 points or 0.07% to 6,849.42, France’s CAC was up by 5.18 points or 0.1% to 5,050.53 and Germany’s DAX inched up by 30.26 points or 0.26% to 11,501.52.

Asian markets closed mostly in red on Thursday as Greece continued last-minute efforts to avert a default. China is to scrap its longstanding loan-to-deposit ratio requirement, the latest in a series of measures to reform the country’s commercial banking sector and get more lending into a slowing economy. The People’s Bank of China will moderately increase short-term liquidity in the banking system through issuing reverse repos to stabilize market expectations.  South Korea announced a stimulus package of more than 15 trillion won ($13 billion) including a supplementary budget, and slashed its economic growth forecast. South Korea’s finance minister stated that he was worried about quarterly growth which would be lower than 1 percent over the April-June period, against a backdrop of an outbreak of Middle East Respiratory Syndrome and an economic slump. South Korean Consumer Confidence fell to 99, from 105 in the preceding month. Hong Kong Trade Balance fell to a seasonally adjusted -40.1B, from -39.2B in the preceding month. Malaysian Unemployment Rate remained unchanged at a seasonally adjusted 3.0%, compared to the preceding month.