Bourses add gains; Sensex up over 130 points

The local equity benchmarks added some gains in late morning session, with Sensex adding more than 130 points, buoyed by firm European markets. The markets have gained momentum, as the Indian services sector bounced back to growth in the month of December. The Nikkei Services Business Activity Index rose to 50.9 in December from 48.5 in November. Similarly, the Nikkei India Composite PMI Output Index rose to 53 in December from 50.3 in November.  The sentiments were also upbeat with the government’s reform push to improve the economy. Recently, the government has given green single to a revised model concession pact for projects based on public private partnership (PPP) design at major ports and capital infusion of Rs 7,577 crore in six weak public sector banks (PSBs) as part of the recapitalisation plan to bolster capital adequacy ratio. Moreover, higher buying in Metal, Capital Goods, Consumer Durables stocks along with higher broader indices, too helped the indices to gain further.  Meanwhile, there was some buzz in chemical stocks with India initiating an anti-dumping probe into import of a Chinese chemical used in detergents following complaints from some domestic companies.

On the global front, European markets were trading in green, as investors reacted to robust economic data from both sides of the Atlantic, while oil prices hovered around two-and-a-half year highs amid unrest in Iran. Asian markets were also trading in green. Back home, in scrip specific development, Veer Energy & Infrastructure traded jubilantly after the company received order for 2000 KW solar rooftop installations in Sanand District in Gujarat.

The BSE Sensex is currently trading at 33927.15, up by 133.77 points or 0.40% after trading in a range of 33802.13 and 33981.67. There were 18 stocks advancing against 13 stocks declining on the index

The broader indices were trading in green; the BSE Mid cap index was up by 0.47%, while Small cap index was up by 0.75%.

The top gaining sectoral indices on the BSE were Metal up by 2.09%, Capital Goods up by 1.85%, Consumer Durables up by 1.72%, Basic Materials up by 1.47% and PSU up by 1.31%, while Realty down by 0.50%, Auto down by 0.34% and IT down by 0.17% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 3.29%, Larsen & Toubro up by 2.85%, ONGC up by 2.76%, Coal India up by 2.20% and Asian Paints up by 2.19%. On the flip side, Tata Motors down by 0.91%, Hero MotoCorp down by 0.60%, Bajaj Auto down by 0.57%, Infosys down by 0.40% and ICICI Bank down by 0.35% were the top losers.

Meanwhile, recovering from last month’s steep fall, the services sector bounced back to growth in the month of December, on the back of stabilization in new order inflows along with easing inflationary pressures. Fastest job creation at both service providers & manufacturers coupled with growth in some industries such as information & communications and finance & insurance, also drove overall business activity during the month. However, the Goods and Services Tax (GST) continued to weigh on underlying sales volumes of some of the firms.

The seasonally adjusted Nikkei Services Business Activity Index rose back above the 50.0 no-change mark in December, posting reading at 50.9 from 48.5 in November. The Nikkei India Composite PMI Output Index which measures both manufacturing and services too climbed to 53.0 in December from 50.3 in November, signaling highest rate of expansion since October 2016.

As per the survey, demand conditions improved in the service sectors after the last month’ decline, while manufacturing new orders grew at sharpest rate since October 2016, backed by strong demand from domestic and international markets. However, backlogs of work increased at both manufacturers and service providers, on account of cash shortages and delayed customer payments.

On inflation front, input cost inflation in the service sector eased from November’s four-year high which softened output charge inflation during the month. On the other hand, manufacturers remained cost burdened in the reported month due GST and to compensate this, firms raised their average selling prices at the fastest pace in 10 months.

The CNX Nifty is currently trading at 10486.35, up by 43.15 points or 0.41% after trading in a range of 10441.45 and 10497.05. There were 28 stocks advancing against 21 stocks declining on the index, while 1 stock remained unchanged.

The top gainers on Nifty were ONGC up by 3.05%, Tata Steel up by 3.05%, Larsen & Toubro up by 2.85%, Coal India up by 2.35% and Asian Paints up by 2.23%. On the flip side, Eicher Motors down by 1.23%, Tata Motors down by 1.04%, HCL Tech. down by 0.98%, Hero MotoCorp down by 0.80% and Infosys down by 0.61% were the top losers.

Asian markets were trading mostly in green; Jakarta Composite increased 6.82 points or 0.11% to 6,258.30, FTSE Bursa Malaysia KLCI surged 7.38 points or 0.41% to 1,800.17, Shanghai Composite was up by 16.6 points or 0.49% to 3,385.71, Taiwan Weighted added 47.06 points or 0.44% to 10,848.63, Hang Seng rose 175.53 points or 0.57% to 30,736.48 and Nikkei 225 zoomed 741.39 points or 3.26% to 23,506.33. On the flip side, KOSPI Index decreased 19.89 points or 0.8% to 2,466.46.

All European markets were trading in green; UK’s FTSE 100 increased 9.85 points or 0.13% to 7,680.96, France’s CAC increased 39.78 points or 0.75% to 5,371.06 and Germany’s DAX increased 113.8 points or 0.88% to 13,092.01.