Markets continue to trade in high spirit in early noon session

Indian markets despite coming off their day’s high were managing to remain considerably higher in the early noon session, on the back of broad-based buying in the front line blue chips counters. Besides, firm trend at other Asian markets, tracking weekend gains at the US markets, too was supporting the markets. Sentiment got boost with the Prime Minister Narendra Modi’s statement that the India is the fastest developing country among the ‘larger economies of the world’. He also said that India is the only economy which has not been affected by the global economic crisis that has hit the world, primarily due to the policies being implemented by the government.  Meanwhile, the banking and financial stocks rallied after Finance Minister Arun Jaitely said that the government would reduce its stake in public sector banks (PSBs) to 52 per cent. 

On the global front, Asian markets were trading mostly in green, after a strong fix for China's yuan eased devaluation concerns and Shanghai stocks returned from the Lunar New Year holidays with only modest losses. Back home, both the Sensex and Nifty were trading above their crucial 23,500 and 7,150 levels, respectively. In scrip specific development, shares of Tata Steel were trading higher over 10% after the company’s wholly owned subsidiary Tata Steel SEZ, is planning to invest about Rs 2,000-2,500 crore for development of infrastructure at Gopalpur in Odisha in the near term.

The BSE Sensex is currently trading at 23523.72, up by 537.60 points or 2.34% after trading in a range of 23197.67 and 23544.22. There were 29 stocks advancing against 1 stock declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 3.38%, while Small cap index up by 3.66%.

The top gaining sectoral indices on the BSE were Metal up by 6.44%, Realty up by 6.07%, Capital Goods up by 4.85%, PSU up by 4.82% and Oil & Gas up by 4.09%, while they were no losers on the sectoral index. 

The top gainers on the Sensex were Tata Steel up by 9.78%, SBI up by 7.16%, Adani Ports &Special up by 7.05%, Larsen & Toubro up by 5.69% and Axis Bank up by 4.91%. On the flip side, Bharti Airtel down by 1.92% were the top losers.

Meanwhile, recording its second straight month of fall, Index of Industrial Production (IIP) contracted by 1.3 percent in December 2015 against 3.6 percent in December 2014. The decline in factory output was mainly due to drop in manufacturing and capital goods sector. Factory output measured in terms of Index of Industrial Production (IIP) also declined by 3.4 percent in November.

As per the data released by the Central Statistics Office of the Ministry of Statistics and Programme Implementation, IIP with base 2004-05 for the month of December 2015 stood at 183.4, which is 1.3 percent lower as compared to the level in the month of December 2014. The decline in December has been primarily on account of a massive drop in output of capital goods which showed a contraction of 19.7 percent in December compared to growth of 6.1 percent in the same month a year ago.  The cumulative growth for the period April-December 2015 over the corresponding period of the previous year stands at 3.1 percent.

On the sectoral basis, growth of manufacturing index which occupies 75.52% weightage in the overall index declined by 2.4 percent against a growth of 4.1 percent in December 2014. The electricity sector, which constitutes about 10 per cent of the index, showed deceleration recording a growth of 3.2 percent as against 4.8 percent growth in same month a year ago. However, the mining sector showed an improvement, registering a growth of 2.9 percent in the month as against a contraction of 1.7 percent in same month a year ago.

The Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month of December 2015 stand at 137.5, 192.0 and 183.2 respectively. The cumulative growth in three sectors during April-December 2015 over the corresponding period of 2014 has been 2.3 percent, 3.1 percent and 4.5 percent respectively. In terms of industries, ten out of the twenty two industry groups in the manufacturing sector have shown negative growth during the month of December 2015 as compared to the corresponding month of the previous year.

As per Use-based classification, the growth rates in December 2015 over December 2014 are 0.5 percent in Basic goods, (-) 19.7 percent in Capital goods and 0.9 percent in Intermediate goods (Statement III).  The Consumer durables and Consumer non-durables have recorded growth of 16.5 percent and (-) 3.2 percent respectively, with the overall growth in Consumer goods being 2.8 percent.

Along with the Quick Estimates of IIP for the month of December 2015, the indices for November 2015 have undergone the first revision and may undergo final (second) revision along with the release of IIP for the month of February 2016.

The CNX Nifty is currently trading at 7156.65, up by 175.70 points or 2.52% after trading in a range of 7056.80 and 7161.10. There were 48 stocks advancing against 2 stocks declining on the index.

The top gainers on Nifty were Bank of Baroda up by 18.43%, Vedanta up by 11.46%, Tata Steel up by 9.93%, SBI up by 7.46% and Hindalco up by 7.31%. On the flip side, Bharti Airtel down by 1.46% and Idea Cellular down by 1.37% were the top losers.

Asian markets were trading mostly in green; Taiwan Weighted increased 3.51 points or 0.04% to 8,066.51, FTSE Bursa Malaysia KLCI increased 12.61 points or 0.77% to 1,656.35, Jakarta Composite increased 23.18 points or 0.49% to 4,737.57, KOSPI Index increased 26.92 points or 1.47% to 1,862.20, Hang Seng increased 540.02 points or 2.95% to 18,859.60 and Nikkei 225 increased 1118.18 points or 7.48% to 16,070.79, while Shanghai Composite decreased 15.89 points or 0.57% to 2,747.60.