Benchmarks trade jubilantly in early deals; Sensex surpasses 34,800 mark

Indian equity benchmarks made a gap-up opening and are trading jubilantly at their all time high levels in early deals on Monday, with frontline gauges surpassing crucial 34,800 (Sensex) and 10,700 (Nifty) levels. Sentiments remained up-beat with traders reacting positively to the IIP numbers, as an exponential rise in the manufacturing output lifted India's total factory production by over 8 percent in November from 1.99 percent in October and 5.1 percent during the corresponding period of 2016-17. On a year-on-year basis, the manufacturing sector expanded by 10.2 percent, whereas mining’s output inched-up by 1.1 percent and the sub-index of electricity generation increased by 3.9 percent. Market participants shrugged off India’s annual retail inflation data which accelerated in December to a 17-month high of 5.21 percent, mainly driven by faster rises in prices of food and fuel products.

Global cues too remained supportive with Asian markets trading mostly in green at this point of time amid optimism in global growth. Japanese shares too were rising even after appreciation in the yen the past week. The US markets extended their gains and ended higher in the last session with major averages once again climbing to new record closing highs.

Back home, IT pack remained in limelight, reacting to the global software major Infosys numbers, which reported consolidated net profit of Rs 5,129 crore for the third quarter of fiscal 2017-18, registering 38.3 percent record annual growth from Rs 3,708 crore in the like period a year ago. Stocks related to logistics space too remained in focus, as GST Network has said that from February 1, transporters will not need separate transit passes for moving goods from one state to another as the e-way bill issued to them will be valid throughout India.

The BSE Sensex is currently trading at 34840.51, up by 248.12 points or 0.72% after trading in a range of 34687.21 and 34842.69. There were 23 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.64%, while Small cap index up by 0.93%.

The top gaining sectoral indices on the BSE were Metal up by 1.68%, Basic Materials up by 1.34%, Bankex up by 1.08%, Power up by 1.06% and Realty was up by 0.99%, while there were no losers on the BSE sectoral front.

The top gainers on the Sensex were ICICI Bank up by 3.49%, Tata Steel up by 2.59%, HDFC up by 1.68%, NTPC up by 1.60% and Axis Bank up by 1.20%. On the flip side, Indusind Bank down by 0.79%, ONGC down by 0.47%, Hero MotoCorp down by 0.18%, Sun Pharma down by 0.14% and Hindustan Unilever down by 0.09% were the top losers.

Meanwhile, after hitting a three-month low of 2.2% in the month of October 2017, India’s Industrial production growth, gave a positive surprise, accelerating to 25-month high of 8.4% in November 2017, as compared to 5.1% in November 2016, on the back of robust performance of manufacturing and capital goods sectors. The previous high was recorded at 9.8% in October, 2015. However, the Index of Industrial Production (IIP) for October 2017 was revised downwards to 2% from the provisional estimates of 2.2%.

As per the data released by the Central Statistics Office of the Ministry of Statistics and Programme Implementation, IIP with base 2011-12 for the month of November 2017, stood at 125.6, which is 8.4% higher as compared to the level in the month of November 2016. The cumulative growth for the period April-November 2017 over the corresponding period of the previous year stood at 3.2%.

On the sectoral basis, the Manufacturing sector, which constitutes 77.63% of the IIP, recorded an impressive growth of 10.2% in November as compared to 4% a year ago. However, the mining sector production growth slowed to 1.1% from 8.1% a year ago. Electricity generation growth too slowed to 3.9% in November from 9.5% in the corresponding month a year ago. The Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month of November 2017 stood at 107.4, 127.5 and 140.1 respectively. The cumulative growth in these three sectors during April-November 2017 over the corresponding period of 2016 has been 3.0%, 3.1% and 5.2% respectively.

Capital goods output, which is a barometer of investment, grew by 9.4% in November as against 5.3% a year ago. Consumer non-durables, which are mainly fast moving consumer goods (FMCG), showed an output growth of 23.1% as against 3.3% in November 2016. However, production growth of consumer durables, mainly white goods like TVs, refrigerators and washing machines, slowed to 2.5% from 6.8%. As per Use-based classification, the growth rates in November 2017 are 3.2% in primary goods, 5.5% in intermediate goods and 13.5% in infrastructure/construction goods.

In terms of industries, 15 out of the 23 industry groups in the manufacturing sector have shown positive growth during the month of November 2017 as compared to the corresponding month of the previous year. The industry group ‘Manufacture of pharmaceuticals, medicinal chemical and botanical products’ has shown the highest positive growth of 39.5% followed by 29.1% in ‘Manufacture of computer, electronic and optical products’ and 22.6% in ‘Manufacture of other transport equipment’. On the other hand, the industry group ‘Other manufacturing’ has shown the highest negative growth of (-) 15.9% followed by (-) 13.1% in ‘Manufacture of wearing apparel’ and (-) 11.2% in ‘Manufacture of electrical equipment’.

The CNX Nifty is currently trading at 10747.20, up by 65.95 points or 0.62% after trading in a range of 10713.80 and 10748.05. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were ICICI Bank up by 3.54%, Tata Steel up by 2.85%, Zee Entertainment up by 2.60%, Hindalco up by 1.75% and HDFC up by 1.67%. On the flip side, Eicher Motors down by 0.85%, ONGC down by 0.82%, Indusind Bank down by 0.79%, HCL Tech. down by 0.61% and GAIL India down by 0.34% were the top losers.

Asian markets are trading mostly in green; FTSE Bursa Malaysia KLCI rose 4.44 points or 0.24% to 1,827.11, Jakarta Composite gained 7.35 points or 0.12% to 6,377.41, KOSPI Index increased 10.14 points or 0.41% to 2,506.56, Taiwan Weighted jumped 37.38 points or 0.34% to 10,921.34, Nikkei 225 added 79.84 points or 0.34% to 23,733.66 and Hang Seng was up by 178.43 points or 0.57% to 31,590.97.

On the flip side, Shanghai Composite was down by 1.73 points or 0.05% to 3,427.21.