Sensex sneaks past 16,500 mark in noon trades; IT, Auto shares support

Stock markets in India continued to garner steam in Tuesday afternoon trades with the benchmark indices touching fresh intraday highs. The key indices climbed by around half a percent and went past the important psychological 16,500 (Sensex) and 5,000 (Nifty) levels. After the over a percent rally in last session, domestic markets showed signs of consolidation in morning trades. However, the key gauges gathered some momentum in early noon trades following the sanguine European market opening. The markets in Europe traded with significant gains of around a percent but investors doubted the upmove as rising Spanish borrowing costs augmented worries about Europe’s debt restructuring challenges. Moreover, the Asian markets too exhibited optimistic trends as investors took to bargain hunting after reports showed world’s second largest Chinese economy continued to employ stimulus measures to boost the nation’s economic activity. The upside for local markets was capped by the resurfacing concerns from money market where the rupee traded on weak note against the US dollar, snapping three sessions of gains on the back of weakness in euro and dollar demand from oil importers and corporate. On the BSE sectoral front, investors were seen piling positions in the Information Technology counter which jumped over a percent, being the top gainer in the space. The rate sensitive Automobile pocket, which got beaten down in the previous session on reports of government mulling hiking excise duty on diesel cars, witnessed some short covering  and climbed about a percent. Though, largely across the board buying interest was evident, investors were seen booking profits from Consumer Durables and defensive FMCG sectors which fell around half a percent.

Moreover, the broader markets continued to trade on a positive note with moderate gains of around a quarter percent, underperforming their larger peers. The bourses rose on good volumes of over Rs 0.8 lakh crore while the market breadth on BSE was in favor of advances in the ratio of 1282:1052 while 135 scrips remained unchanged.

The BSE Sensex is currently trading at 16,510.25 up by 93.41 points or 0.57% after trading as high as 16,510.25 and as low as 16,410.23. There were 23 stocks advancing against 7 declines on the index.

The broader indices were trading on a positive note; the BSE Mid cap index rose 0.23% and Small cap index gained 0.39%.

On the BSE sectoral space, IT up 1.22%, Auto up 0.86%, TECk up 0.82%, Capital Goods up 0.80% and Power up 0.74% were the major gainers, while Consumer Durables down 0.69% and FMCG down 0.46% were the only laggards in the space.

Maruti up 2.03%, SBI up 1.98%, TCS up 1.92%, Tata Motors up 1.66% and BHEL up 1.34% were the major gainers on the Sensex, while ITC down 1.13%, Bharti Airtel down 0.69%, DLF down 0.45%, HDFC Bank down 0.40% and Hindalco down 0.22% were the major losers in the index.

Meanwhile, Manmohan Singh’s visit to Myanmar, the first by an Indian Prime Minister in 25 years, turned out to be a significant one as both the nations discussed and agreed upon a host of agreements including one on oil exploration. The two south Asian neighbors have mutually agreed to target doubling of bilateral trade by 2015 and also both governments would work to identify and remove various impediments to bilateral trade.

Underscoring the fact that there is considerable untapped potential for greater trade, both Indian Prime Minister Manmohan Singh and Myanmar President Thein Sein urged the business communities to capitalize on this potential. The two leaders also highlighted the importance of the newly created Trade and Investment Forum in enabling timely and accurate exchange of information and ideas.

Myanmar, a reclusive south-east Asian country that has begun to open up, specifically encouraged investments by Indian companies in areas like ports, highways, oil & gas, plantation, manufacturing, hospitality and ICT. India and Myanmar signed agreements on production sharing contract for exploration and production of Petroleum and leasing of a paper and pulp mill.

In view of the vast potential for promoting trade between the two countries, both sides agreed that the Reserve Bank of India (RBI) would sign a MoU with the Central Bank of Myanmar (CBM) on currency arrangements between India and Myanmar in the near future. Further, the RBI would also conclude a MoU with the CBM to serve as a platform for an exchange of views on issues of mutual interest. The two sides agreed upon sharing of banking experiences and technical know-how from State Bank of India or any other bank as mutually agreed.

The S&P CNX Nifty is currently trading at 5,009.55, up by 23.90 points or 0.48% after trading as high as 5,013.50 and as low as 4,982.30. There were 34 stocks advancing against 16 declines on the index.

The top gainers on the Nifty were Ranbaxy up 2.70%, HCL Tech up 2.61%, Cairn up 2.36%, Maruti up 2.02% and SBI up 1.96%.

BPCL down 1.87%, IDFC down 1.50%, ITC down 1.26%, Grasim down 0.83% and Ambuja Cement down 0.76% were the major losers on the index.

In the Asian space, Shanghai Composite surged 1.23%, Hang Seng soared 1.06%, KLSE Composite inched up 0.19%, Nikkei 225 climbed 0.74%, Straits Times Index advanced 0.49%, KOSPI Composite Index jumped 1.41% and Taiwan Weighted spurted 2.89%.

On the other hand, Jakarta Composite dropped 0.26%.

The European markets got off to a positive start as France’s CAC 40 climbed 0.79%, Germany’s DAX gained 0.60% and United Kingdom’s FTSE rose 1.01%.