Benchmarks stage splendid performance; Nifty ends near 8,950 mark

Boisterous benchmarks showcased an enthusiastic performance on Tuesday, by rallying over one and a half percentage point amid strong global cues. Sentiments remained up-beat since start as key bourses made a gap-up opening and there appeared not even an iota of profit booking in the session as the bourses managed to fervently gain from strength to strength, as investors continued accumulating fundamentally strong stocks. Frontline indices not only ended the session near intraday high levels but also recaptured their crucial 8,900 (Nifty) and 28,900 (Sensex) bastions on hefty across the board buying.

Sentiments remained up-beat on expectation of further delay in interest rate hike by the US Federal Reserve on account of slower than expected US jobs data in August. Traders also took some encouragement with report that growth in India’s service industry accelerated to its fastest pace in more than 3-1/2 years in August, driven by a surge in domestic and foreign demand. The Nikkei/Markit Services Purchasing Managers’ Index jumped to 54.7 in August, it’s highest since January 2013, from 51.9 in July. Reports that Prime Minister's Office (PMO) will soon clear projects worth Rs 20 lakh crore, too aided sentiments. Moreover, Project Monitoring Group (PMG) has already cleared 276 projects worth 10 lakh crore which were stalled due to various reasons including roads, environment, coal and power among others.

Global cues too remained supportive with European counters making a positive start and holding near their highest levels since April as commodities-related stocks surged. Asian markets rallied on the back of surge in oil prices and the Reserve Bank of Australia keeping rates on hold, as widely expected.

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. Markets got some support with surge in Indian rupee against the US dollar on selling of the American currency by exporters and banks amid sustained foreign fund inflows and a weak dollar against other currencies overseas. Meanwhile, former RBI Governor Raghuram Rajan has expressed his hopes that the process of cleaning up banks in the country will be finished and government will continue to prioritise “low inflation”.

On the sectoral front, auto stocks remained in top gear post fabulous August sales figure.  Tata Motors reported 6% growth in August sales, Hero MotoCorp posted 28% growth in August sales and TVS Motor Company witnessed a sales growth of 20% in the same month. Steel stocks ended higher despite early cautiousness that came with some reports that government is unlikely to further extend the minimum import price (MIP) on certain steel products beyond October 4 as these items could be covered under anti-dumping duty.

The NSE’s 50-share broadly followed index -- Nifty -- rose by over one hundred and thirty points to end above the psychological 8,900 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex -- surged by around four hundred and fifty points to finish near the psychological 29,000 mark. Broader markets too traded with traction and ended the session with gain of around a percentage point.

Finally, the BSE Sensex surged 445.91 points or 1.56% to 28,978.02, while the CNX Nifty gained 133.35 points or 1.51% to 8,943.00. 

The BSE Sensex touched a high and a low 29,013.40 and 28,631.27, respectively. There were 25 stocks on gainers side against 4 stocks on decliners side, while one stock remained unchanged on the index. The broader indices too ended in green; the BSE Mid cap index surged by 1.84%, while Small cap index was up by 0.95%.

The top gaining sectoral indices on the BSE were Bankex up by 2.96%, Consumer Durables up by 2.94%, Auto up by 2.83%, Industrials up by 2.22% and Finance up by 2.17%, while there were no losers on the BSE sectoral front.

The top gainers on the Sensex were Tata Motors up by 7.19%, Axis Bank up by 6.14%, ICICI Bank up by 4.25%, Tata Steel up by 3.25% and Maruti Suzuki up by 3.04%. On the flip side, TCS down by 1.17%, Coal India down by 1.11%, Wipro down by 0.11% and ITC down by 0.04% were the few losers.

Meanwhile, in what could come as a major boost to the country’s infrastructure sector and the economy as on whole, the Prime Minister's Office (PMO) reportedly will soon clear projects worth Rs 20 lakh crore. The report which is yet not confirmed has stated that the Project Monitoring Group (PMG) that works under the Prime Minister's Office has cleared 276 projects, stalled due to various reasons accounting for investment of nearly Rs 10 lakh crore, in the last two years, while another 258 projects, with investment of more than Rs 10 lakh crore, will be cleared soon.

Since 80% of clearance problems are state-level, PMO has reduced the number of such clearances from 63 to 31, and has asked all states to digitise the process of applying for these clearances. PMG, which was formed by the UPA government and put under the cabinet secretariat, was shifted to the PMO in September 2015. Prime Minister Narendra Modi wants more private sector entrepreneurs to use the PMG portal. Roughly 20% of projects assessed by PMG are from the private sector.

States that have benefitted most from PMG clearances are Odisha, Jharkhand, Maharashtra, Chhattisgarh and Karnataka. All states have been asked to create their own version of PMG portal for investment below Rs 1,000 crore.

The CNX Nifty traded in a range of 8,950.85and 8,848.45. There were 43 stocks advancing against 8 decliners on the index.

The top gainers on Nifty were Tata Motors up by 7.07%, Tata Motors - DVR up by 6.14%, Axis Bank up by 6.12%, ICICI Bank up by 4.36% and Yes Bank up by 3.78%. On the flip side, TCS down by 1.22%, Coal India down by 1.04%, Tata Power down by 0.63%, Ultratech Cement down by 0.26% and Aurobindo Pharma down by 0.25% were the top losers.

European markets were trading mostly in green; France’s CAC increased 8.68 points or 0.19% to 4,549.76 and Germany’s DAX was up by 38.79 points or 0.36% to 10,711.01, while UK’s FTSE 100 was down by 12.17 points or 0.18% to 6,867.25.

The Asian markets ended in green on Tuesday, as oil prices rallied and the Reserve Bank of Australia kept rates on hold, as widely expected. The Reverse Bank of Australia (RBA) in a statement cited reasons such as continued growth, low inflation and mixed labor market data as contributing factors to hold interest rates steady. Chinese shares ended higher, led by gains in consumer and industrial stocks. Further, Japanese shares rose as the yen weakened against the dollar after rising on Monday following a speech from BOJ Governor Haruhiko Kuroda.