Markets stage splendid performance; Nifty regains 8,500 mark

Boisterous benchmarks showcased an enthusiastic performance on Wednesday, by rallying around a percentage point. Sentiments remained up-beat since start as key bourses opened on a positive note and there appeared not even an iota of profit booking in the session as the benchmarks managed to fervently gain from strength to strength as investors continued hunt for fundamentally strong stocks. Frontline indices not only ended the session near intraday high levels but also recaptured their crucial 8,500 (Nifty) and 28,150 (Sensex) bastions as investors took to hefty across the board buying.

Sentiments remained jubilant with global rating agency Standard and Poor’s (S&P) latest report, expecting a stable trend in sovereign credit rating in Asia-Pacific nations, including India, despite growing economic uncertainties. In its mid-year review of the Asia-Pacific region, S&P retained India’s sovereign rating at ‘BBB-' with stable outlook as originally mentioned in its report in September 2014. Some support also came with Finance Minister Arun Jaitley’s statement that the Centre was planning to spend Rs 50,000 crore on the farming and irrigation sector and plans were also afoot to roll out an insurance scheme exclusively for the farming sector to compensate for crop loss. Meanwhile, Prime Minister Narendra Modi will be launching the National Skill Mission in an effort to create a large pool of skilled workforce required to sustain his ambitious ‘Make in India’ initiative. The mission is aimed at roping in 24 lakh youth, across India, over the next one year.

On the global front, European markets were trading in green in early deals as the Greece Parliament will vote on a sweeping austerity package to secure the funding it needs to stem its fiscal crisis and remain in the euro zone. Asian markets ended mostly in green after data showed China’s economy grew more than expected in the second quarter. 

Back home, there was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too participated strongly in the rally. Some support also came on reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 269.90 crore on July 14, 2015, as per provisional data by the stock exchanges. Buying in auto space too aided the sentiments led by Maruti Suzuki, which surged to its fresh all time high on some brokerage upgrade. Stocks related to software and technology counters too edged higher despite rupee appreciation after the Greek deal. Additionally, shares of companies engaged in education software and vocational training institutes also remained on buyers’ radar on hopes that Prime Minister Narendra Modi's 'Skill India' initiative may change the fortune of these companies.

The NSE’s 50-share broadly followed index Nifty gained by around seventy points to end above its psychological 8,500 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex surged by over two hundred and sixty points to end near its crucial 28,200 mark. The broader markets too traded in green ended the session with a gain of around half a percent. The market breadth remained in favour of advances, as there were 1,539 shares on the gaining side against 1,280 shares on the losing side while 144 shares remain unchanged.

Finally, the BSE Sensex surged by 265.39 points or 0.95% to 28198.29, while the CNX Nifty soared by 69.70 points or 0.82% to 8523.80.

The BSE Sensex touched a high and a low 28218.37 and 27986.48, respectively. The BSE Mid cap index was up by 0.08%, while Small cap index up by 0.49%.

The top gaining sectoral indices on the BSE were Auto up by 1.35%, IT up by 1.19%, TECK up by 1.02%, Healthcare up by 0.97% and Realty up by 0.52%, while Consumer Durables down by 1.22% and PSU down by 0.06% were the losing indices on BSE.

The top gainers on the Sensex were Maruti Suzuki up by 2.63%, Tata Motors up by 2.22%, Wipro up by 2.00%, TCS up by 1.87% and Mahindra & Mahindra up by 1.82%. On the flip side, Tata Steel down by 0.35% and SBI down by 0.11% were the top losers.

Meanwhile, Finance Minister Arun Jaitley, admitting that the condition of farmers is a “matter of concern”, has said the Centre was planning to spend Rs 50,000 crore on the farming and irrigation sector and plans were also afoot to roll out an insurance scheme exclusively for the farming sector to compensate for crop loss. The finance minister while noting that the agriculture sector presents its own set of challenges with successive low rate of growth over the years, also admitted that 'We have been unable to ensure even a 4 per cent growth consistently in the field of agriculture.'

Jaitley further stated that with productivity levels reasonably low and 85 per cent farmers being small and marginal, the agriculture sector is afflicted by higher input costs, low level of irrigation, high indebtedness, absence of an effective insurance mechanism and adverse impacts of climate change.

Talking about insurance, Jaitley said that the present crop insurance schemes cover only the loans which a farmer has taken from banks and the condition of farmers is a matter of concern...”We are working on the next challenge wherein if farmer's crop gets damaged, he will automatically get insurance amount for the crop loss while sitting at his home. We are bringing an insurance scheme only for the farming sector.”

Earlier the Finance Minister had stated that Ashok Gulati, Infosys Chair Professor for Agriculture, ICRIER (Indian Council for Research on International Economic Relations), had made a presentation to the government on a 'doable and effective' insurance programme, under which the farmer is able to at least recover the basic inputs in the event of uncertainty caused by more than one reason.

The CNX Nifty touched a high and low 8,531.40 and 8,462.95 respectively.

The top gainers on Nifty were Maruti Suzuki up by 2.49%, HDFC up by 2.48%, Tata powers up by 2.26% Wipro up by 2.23% and Ultra cement up by 2.13%. On the flip side, Cairn India down by 1.23%, Yes Bank down by 0.91%, PNB down by 0.86%, HCL Tech down by 0.78 and BPCL down by 1.00%, were the top losers.

European Markets were trading in the green; UK's FTSE was up by 0.01%, Germany’s DAX was up by 0.09% and France’s CAC was up by 0.01%.

Asian markets closed mostly in green on Wednesday, with Tokyo stocks closing higher as a weaker yen supported the market after Bank of Japan cut its annual inflation and growth forecasts, boosting the chance of more monetary easing this year. The Bank of Japan voted 8 to 1 as expected to keep monetary policy steady as board member Takahide Kiuchi once again dissented and called for a cut in outright government bond buying by nearly half. The board enlightened that exports and output were picking up even as consumer prices are nearly flat year-on-year. Kiuchi has called for trimming asset purchased by the BoJ to 45 trillion yen annually from 80 trillion yen set in October last year. Chinese GDP remained unchanged at an annual rate of 7.0% compared to the preceding month. Chinese Retail Sales rose to an annual rate of 10.6%, from 10.1% in the preceding month while Chinese Industrial Production rose to 6.8%, from 6.1% in the preceding month. Indonesian Trade Balance fell to a seasonally adjusted 0.48B, from 0.95B in the preceding month. Singaporean Retail Sales rose to a seasonally adjusted 6.1%, from 5.0% in the preceding month.