Post Session: Quick Review

Boisterous benchmarks showcased an enthusiastic performance on Friday, by rallying over a percentage point. After a cautious start, sentiments turned up-beat as investors continued hunt for fundamentally strong stocks. But, rally in last leg of trade mainly helped the frontline indices not only ended the session near intraday high levels but also recaptured their crucial 7,450 (Nifty) and 24,600 (Sensex) bastions as investors took to hefty across the board buying. Traders got some support with report that India has received $4.5 billion foreign direct investment (FDI), recording a whopping 114 percent growth during December 2015 which is more than double against the same period in 2014. During the period, the sectors which attracted FDI include computer software and hardware, trading, services, automobile and telecommunications. India receives maximum FDI from Singapore, Mauritius, the Netherlands and Japan. India had received $2.16 billion in December 2014.

Some support also came in with India Ratings’ report that the Indian economy may have expanded by 7.6% in the third quarter that ended in December 2015. Moreover, investors ignored that survey conducted by the Reserve Bank of India stating that Indian households expect inflation at over 10 percent in the year ahead, twice as much as RBI's retail inflation target of 5 percent by March 2017. In general, a majority of the respondents expect prices to increase over the next three months and a year ahead.

On the global front, European counters were trading mostly in green in early deals ahead of the release of a key jobs report in the United States that could provide clues on the Federal Reserve’s monetary policy outlook. Asian markets ended mostly in green, tracking the modest gains overnight on Wall Street. However, Japanese shares declined as the strengthening yen pressured major exporters.

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. Buying in metal counters too supported the sentiments on a report of MIP notification.

Shares of pharmaceutical companies rallied on the bourses after Lupin reported a better-than-expected net profit for the quarter ended December 31, 2015. The IT sector stocks too edged higher despite industry body Nasscom stating that export growth in the country's IT-BPO sector is expected to be slower at 10-12 percent next fiscal hit by currency fluctuations, especially the weakening of the rupee against the US dollar. Last year, the IT services and software industry body had forecast a growth of 12-14 percent in exports.

The NSE’s 50-share broadly followed index -- Nifty -- rose by around ninety points to end above the psychological 7,450 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex -- surged by around two hundred and eighty points to finish above the psychological 24,600 mark. Broader markets too traded with traction and ended the session with a gain of around one and half a percent.

The market breadth remained in favor of advances, as there were 1,619 shares on the gaining side against 1,016 shares on the losing side while 136 shares remain unchanged. (Provisional)

The BSE Sensex ended at 24616.97, up by 278.54 points or 1.14% after trading in a range of 24345.79 and 24672.90. There were 24 stocks advancing against 6 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 1.90%, while Small cap index up by 1.21%. (Provisional)

The gaining sectoral indices on the BSE were Metal up by 3.37%, Healthcare up by 3.37%, Bankex Auto up by 2.11%, Materials up by 1.99% and Finance up by 1.87%, while there was no loser on the index. (Provisional)

The top gainers on the Sensex were Lupin up by 10.72%, Axis Bank up by 4.95%, Tata Steel up by 4.18%, Cipla up by 3.63% and SBI up by 3.59%. On the flip side, GAIL India down by 2.71%, Maruti Suzuki down by 1.76%, Adani Ports &Special down by 1.58%, NTPC down by 0.60% and Infosys down by 0.25% were the top losers. (Provisional)

Meanwhile, afresh the demand for pay revision can be raised by Ministries and departments, if they find that some of the justified suggestions made by the staff associations were not accepted by the 7th Central Pay Commission. Such demands could be submitted to the Implementation Cell (IC), created in the Finance Ministry, to work as Secretariat for the Empowered Committee of Secretaries headed by Cabinet Secretary P K Sinha. The CoS will screen the recommendations of the Commission and firm up the conclusions for approval of the Cabinet.

Minutes of the of first meeting of the IC has said that If a representation was made by a Staff Association before the 7th Central Pay Commission and the Commission after due diligence has not accepted the demand made there in, the same matter normally not be considered at the stage. However, if departments consider that the issues are of such nature that they require consideration at this stage also, then they may give their comments with full justifications to the IC.

In order to process the recommendations of the 7th Central Pay Commission, the government has set up a 13-member Empowered CoS headed by Cabinet Secretary which functions as a Screening Committee to screen the recommendations of the Commission after taking into account the views of the concerned stakeholders. The final recommendations of the Empowered Committee of Secretaries will be submitted for approval of the Cabinet.

The 7th Pay Commission has recommended a 23.55 percent hike in salary, allowances and pension involving an additional burden of Rs 1.02 lakh crore for the government, of which increase in salary would be Rs 39,100 crore, allowances Rs 29,300 crore and pension Rs 33,700 crore. The new pay scales, subject to acceptance by the government, will come into effect from January 1, 2016.

The CNX Nifty ended at 7489.10, up by 85.10 points or 1.15% after trading in a range of 7406.65 and 7503.15. There were 38 stocks advancing against 12 stocks declining on the index. (Provisional)

The top gainers on Nifty were Vedanta up by 9.08%, Lupin up by 9.08%, Axis Bank up by 4.39%, PNB up by 4.18% and Hindalco up by 3.71%. On the flip side, Bosch down by 5.24%, GAIL India down by 3.51%, Adani Ports &Special down by 2.13%, Maruti Suzuki down by 1.88% and Power Grid down by 1.06% were the top losers. (Provisional)

European markets were trading mostly in green; France’s CAC increased 23.18 points or 0.55% to 4,251.71 and UK’s FTSE 100 was up by 24.29 points or 0.41% to 5,923.05, while Germany’s DAX was down by 23.95 points or 0.25% to 9,369.41.

Asian equity markets closed mostly higher on Friday, taking cues from a positive finish in Wall Street overnight and a rebound in oil prices in Asian deals helped underpin investor sentiment. But, gains were capped across the region ahead of the US monthly jobs report due out later in the day that could provide further insights into the world's largest economy and its rate policy. Employment is expected to increase by about 188,000 jobs in January after jumping by 292,000 jobs in December. The unemployment rate is expected to hold at 5.0 percent. Hong Kong shares rose, aided by overnight gains in US and European markets. But trading was thin, with many already leaving for the Lunar New Year holiday. China stocks ended lower as the market doubts that government moves to raise investment ceilings for overseas investors won't lead to an immediate surge in foreign buying of Chinese equities. Japanese shares fell for a fourth day amid a firmer yen on concerns about slowing US economic growth and growing doubts about the pace of future rate increases at the Federal Reserve.