Post Session: Quick Review

Indian markets extended their rally with big gains on Thursday, amid continued buying by funds and retail investors. Nifty not only reclaimed its crucial psychological level of 8,600, but both the benchmarks ended at their highest level since April 17. The broad based buying continued unabated and apart from the blue-chips the broader markets too participated in the rally equally. The Iran deal continued powering the markets, as per the deal, sanctions imposed by the US, European Union and United Nations will be lifted in return for Iran agreeing long-term curbs on a nuclear program.  Oil stocks, especially the downstream ones got additional boost with Petroleum Minister Dharmendra Pradhan’s statement that International oil prices will come down with the imminent lifting of sanctions against Iran and benefit India.In the latter part of trade, markets got a boost with the Cabinet clearing a policy for composite foreign investment limits by including FDI, FII and other routes. Now, there would be no separate caps for foreign direct investments and foreign portfolio investments. Composite caps have been suggested for sectors like agriculture, tea plantations, petroleum and natural gas, manufacturing, airports, real estate, telecommunications, mining, non-banking financial companies and pharmaceuticals.

On the global front, despite weak cues from the US markets, the Asian markets ended mostly in green after Greece’s parliament endorsed the fresh set of austerity measures. The Shanghai Composite pared its early losses to end with gains of around half a percent. The European markets too extended their gains along with the other global markets on speculation a Greek parliamentary vote in favor of creditor-imposed demands removes an obstacle to higher US rates. The focus now shifts to how the European Central Bank will bolster the nation’s financial system.

Back home, the jubilant markets got additional boost with some announcements of the government; Finance Minister Arun Jaitley informed that the Cabinet approved spending of over Rs 8,500 crore on multi-state power transmission system. Additional funds of Rs. 700 crore have been sanctioned for recapitalisation of regional rural banks. He also announced that the Cabinet approved a proposal for redevelopment of 400 railway stations across the country. This particular announcements turned the infra stocks in a jubilant mood. Markets kept moving higher and stopped only with the closing bell, near the session's high. Traders  even overlooked the disappointing export data; value of exports for June was $22.89 billion, down 16 percent year-on-year. Trade deficit in June increased by 4% to $10.83 billion, to $10.41 billion in May. Apart from oil & gas financial and other rate sensitive stocks surged on hopes that a fall in oil prices due to the Iran nuclear deal will lower import costs and interest rates.

The BSE Sensex ended at 28477.30, up by 279.01 points or 0.99% after trading in a range of 28245.81 and 28477.54. There were 23 stocks advancing against 6 stocks declining on the index. (Provisional)

The broader indices went neck-in-neck to the broader markets and the BSE Mid cap index surged by 1.38%, while Small cap index ended higher by 0.76%. (Provisional)

The top gaining sectoral indices on the BSE were Consumer Durables up by 2.38%, Bankex up by 2.00%, FMCG up by 1.22%, Power up by 1.18%, PSU up by 1.09%, while Realty down by marginally 0.05% was the lone losing index on the BSE. (Provisional)

The top gainers on the Sensex were Axis Bank up by 4.11%, BHEL up by 2.45%, HDFC Bank up by 1.99%, ITC up by 1.83% and Cipla up by 1.79%. On the flip side, Vedanta down by 1.24%, Mahindra & Mahindra down by 1.03%, Wipro down by 0.79%, TCS down by 0.56% and Hero MotoCorp down by 0.45% were the top losers. (Provisional)

Meanwhile, India’s trade deficit narrowed to 10.8 billion in June as compared to 11.7 billion in same month previous year. The trade deficit for April-June, 2015-16 was estimated at $ 32225.66 million which was lower than the deficit of $33083.93 million during April-June, 2014-15. However, country’s exports contracted for the seventh straight month by 15.82 percent to $22.2 billion on account of slump in global demand. 

As per the government data, Exports during June, 2015 were valued at $22289.43 million which was 15.82 per cent lower in Dollar terms than the level of $26479.72 million. In rupee terms Exports stood at Rs 142341.88 crore, 10.00 per cent lower, as compared to Rs 158165.21 crore  during June, 2014. Cumulative value of exports for the period April-June 2015-16 was $ 66690.90 million as against $80112.30 million, while in rupee term it stood at Rs 423315.24 crore compared to Rs 478928.90 crore, registering a negative growth of 16.75 per cent in Dollar terms and 11.61 per cent in Rupee terms over the same period last year.

The imports also dropped 13.40 percent to $33116.55 million in May as compared to $38242.96 million and in rupee term the level of imports valued at Rs 211484.61 crore, 7.42 per cent lower as compared to Rs 228427.88 crore in June 2014. Cumulative value of imports for the period April-June 2015-16 was $98916.56 million as against $113196.23 million, while in rupee term it was Rs 627830.30 crore against Rs 676694.53 crore, registering a negative growth of 12.61 per cent in Dollar terms and 7.22 per cent in Rupee terms over the same period last year.

Oil imports during June, 2015 were valued at $8676.38 million, 34.97 per cent lower than oil imports valued at $13342.79 million in the corresponding period last year. Oil imports during April-June, 2015-16 were valued at $ 24657.97 million which was 39.54 per cent lower than the oil imports of $ 40785.50 million in the corresponding period last year. Non-oil imports during June, 2015 were estimated at $24440.17 million, 1.85 per cent lower than non-oil imports of $24900.17 million in June, 2014. Non-oil imports during April-June, 2015-16 were valued at $ 74258.59 million which was 2.55 per cent higher than the level of such imports valued at $ 72410.73 million in April-June, 2014-15.

The CNX Nifty ended at 8610.80, up by 87.00 points or 1.02% after trading in a range of 8542.90 and 8616.10. 38 stocks ended in green against 11 stocks in red on the index, while one stock remained unchanged. (Provisional)

The top gainers on Nifty were Kotak Mahindra Bank up by 4.17%, Axis Bank up by 4.14%, Yes Bank up by 3.07%, BHEL up by 2.76% and BPCL up by 2.54%. On the flip side, NMDC down by 1.48%, Vedanta down by 1.31%, Mahindra & Mahindra down by 0.87%, Ultratech Cement down by 0.63% and GAIL India down by 0.55% were the top losers. (Provisional)

The European markets were trading with good gains, UK’s FTSE 100 was up by 35.17 points or 0.52% to 6,788.92, France’s CAC surged by 79.18 points or 1.57% to 5,126.42 and Germany’s DAX was higher by 176.91 points or 1.53% to 11,716.57.

Asian markets closed mostly in green on Thursday, while Indonesia Stock Exchange was closed today on account of ‘National Leave’ holiday. The Asian Development Bank trimmed its growth forecasts for China and developing Asia this year and next. After a slow first half, full-year gross domestic product growth in China is now estimated at 7 percent this year and 6.8 percent next year. That compares with its March estimate of 7.2 percent in 2015 and 7 percent next year. Weaker-than-expected external demand, a declining working-age population and rising wages were all factors in China’s slowing growth. Softness in major industrialized economies should lead to growth in East Asia including China, Taiwan, South Korea and Hong Kong to ease to 6.2 percent this year instead of 6.5 percent.

Indonesia posted a $477 million trade surplus in June, narrowing from a revised $1.1 billion in May as exports of coal and palm oil continue to fall. The country has recorded its seventh straight monthly surplus as slowing investments and lack of government spending drags demand of overseas goods. The surplus should provide some support to the rupiah, which continues falling ahead of the US Federal Reserve’s plan to raise its interest rate by the end of this year. A recovery in China’s home sales has yet to take hold and give developers enough confidence to speed up land acquisitions and new construction, although there are expectations the second half will be better than the past six months under strong policy support, including easier and cheaper funding. China’s property sales revenues rose 10 percent year-on-year in the first half, quickening from an increase of 3.1 percent in the first five months which ended a losing streak in the previous 15 months. Singaporean Retail Sales rose to a seasonally adjusted 6.1%, from 5.0% in the preceding month.