Benchmarks prolong gains for second straight session in morning trade

Sentiments remained bullish in the morning trade with Nifty breaching 5,000 mark in initial trade, extending gains for the second straight session on continued buying by funds and retailers amid a firming trend in Asian markets. Though, markets came off its crucial 5,000 mark tracking weakness in Indian rupee, which opened marginally weaker at 55.42 against the US dollar. On the global front, most of the Asian counters were trading in the green at this point of time though, Japanese Nikkei edged lower on report that unemployment unexpectedly rose in the country. The unemployment rate increased to 4.6 percent in April from 4.5 percent in March, the first increase in three months. Back home, BSE’s -- Sensex -- and NSE’s -- Nifty - inching towards their crucial, 16,500 and 5,000 mark respectively, supported by index heavyweights SBI, ICICI Bank, Tata Motors and L&T. Moreover, the sentiments were supported by global rating agency Moody’s comment that the sliding rupee will not impact India’s sovereign ratings. On sectoral front, healthcare witnessed the maximum gain in trade followed by capital goods and auto while, consumer durables, fast moving consumer goods and technology remained the few losers on the BSE sectoral space. The broader indices were going neck to neck with benchmarks. The market breadth on the BSE was positive; there were 890 shares on the gaining side against 628 shares on the losing side while 76 shares remained unchanged. 

The BSE Sensex opened at 16,500.04; about 83 points higher compared to its previous closing of 16,416.84, and has touched a high and a low of 16,505.35 and 16,438.67 respectively.

The index is currently trading at 16,442.61, up by 25.77 points or 0.16%. There were 21 stocks advancing against 9 declines on the index.

The overall market breadth has made a strong start with 55.83% stocks advancing against 39.40% declines. The broader indices were trading in-line with benchmarks; the BSE Mid cap and Small cap indices surged 0.16% and 0.36% respectively.

The top gaining sectoral indices on the BSE were, HC up by 0.65%, CG up by 0.52%, Auto up by 0.43%, Bankex up by 0.43% and PSU up by 0.41%. While CD down by 0.51%, FMCG down by 0.31%, TECk down by 0.08% and Realty down by 0.03% remained the few losers on the index.

The top gainers on the Sensex were Tata Motors up by 1.23%, BHEL up by 1.20%, SBI up by 1.16%, Coal India up by 1.10% and Maruti Suzuki up by 0.93%.

On the flip side, Hindalco was down by 1.00%, Bajaj Auto was down by 0.64%, HUL was down by 0.57%, DLF was down by 0.42% and Bharti Airtel was down by 0.36% were the top losers on the Sensex.

Meanwhile, the record production of wheat this year has led to a wheat procurement of 32.6 million tonnes (mt) in the marketing season of April-June. This is more than the government’s estimate of 31.8 mt and is expected to grow further as wheat from Uttar Pradesh and Madhya Pradesh is still coming in.

UP and MP are seeing a daily crop arrival of up to 150,000 tonnes. This is in contrast to the almost dried up arrival of 16,500 tonnes daily seen by Punjab and Haryana who have already contributed record 12.8 mt and 8.6 mt of the grain respectively this year.

Punjab and Haryana had procured nearly 10.9 mt and 6.92 mt of wheat respectively in the previous season. Wheat purchase in Madhya Pradesh stood 6.9 mt this year while that in Uttar Pradesh was at 2.5 mt this year. Food Corporation of India (FCI) and other state agencies had procured about 24.8 mt in the year-ago period. In the entire 2011-12, the procurement stood at 28.33 mt.

India is the second largest producer of wheat in the world. It is estimated that India will produce a record 90.23 mt in the 2011-12 crop year (July-June). Its storage however, is likely to be a task for the government. This is because the government has a capacity to store 62.8 mt of foodgrains but the stocks are expected to go upto 75 mt by end of this month.

The Ranagarajan committee had suggested last week that the government should consider offloading of 10 mt of wheat to BPL and APL families and three million tonnes through open market sale. The panel had also suggested exports of 2 million tonnes of wheat from the government godowns.

The S&P CNX Nifty opened at 5,005.35; about 20 points higher compared to its previous closing of 4,985.65, and has touched a high and a low of 5,009.95 and 4,988.80 respectively.

The index is currently trading at 4,990.50, higher by 4.85 points or 0.10%. There were 30 stocks advancing against 20 declines on the index.

The top gainers of the Nifty were HCL Tech up by 2.54%, Ranbaxy up by 1.97%, Tata Motors up by 1.16%, SBI up by 1.10% and Coal India up by 1.05%.

On the flip side, BPCL down by 1.79%, Reliance Infra down by 1.75%, Hindalco down by 1.26%, Bajaj Auto down by 1.01% and IDFC down by 0.91%, were the major losers on the index.

Most of the Asian equity indices were trading in the green; Shanghai Composite climbed 19.29 points or 0.82% to 2,380.65, Hang Seng Index advanced 43.61 points or 0.23% to 18,844.60, Straits Times Index added 2.75 points or 0.10% to 2,789.97, KOSPI Composite Index gained 10.70 points or 0.59% to 1,834.87 and Taiwan Weighted spurted 169.46 points or 2.37% to 7,305.46.

On the other hand, Jakarta Composite eased 13.61 points or 0.35% to 3,905.07, KLSE Composite dropped 0.84 points or 0.05% to 1,554.10 and Nikkei 225 fell 30.29 points or 0.35% to 8,562.86.