Sensex extends uptrend; June series F&O expiry eyed

Stock markets in India snapped a choppy session on a positive note on the penultimate day of June series Futures and Options contract expiry, as the frontline equity indices settled with gains of around one third of a percent.

Despite trading with good gains for most part of the day, the bourses failed to build on the impetus after reports suggested that likelihood of good monsoon this season is fast receding. While there is already a 23 percent deficiency in rainfall, Northern and western parts of India will have to wait for at least another eight days for a major revival in the monsoon, a development which could hurt India’s agrarian economy in a big way.

However, the markets managed to extend the uptrend for second straight session and settled just below the psychological 17,000 (Sensex) and 5,150 (Nifty) levels. Domestic sentiments were supported by SEBI’s recent decision to relax rules that govern Offer for Sale (OFS) and Institutional Placement Programme (IPP) mechanisms which will aid firms to smoothly conduct disinvestment process and also abide by the public shareholding regulations.

Moreover, investors also remained in positive mood following the resignation of Pranab Mukherjee as hopes that the government would push for investments in the infrastructure sector rose after Prime Minister Manmohan Singh took over the charge of the Finance Ministry. But, cues from the money market remained subdued as the Indian rupee, despite recent measures announced by RBI, extended its streak of depreciation against the dollar as it rose above 57.10 mark against the US dollar on sustained American greenback demand, undermining investor sentiments and raising concerns over slowing economic activity and drying inflows from foreign funds.

On the BSE sectoral space, the Metal counter soared over one and half a percent and remained the top gainer in the space. The Power pocket surged over a percent led by power generation and distribution company shares after three Delhi-based private distribution companies hiked the price of power for domestic use by a steep 24.15 percent after getting the go-ahead from the Delhi Electricity Regulatory Commission while the price of power for commercial use also was hiked by 19.5 percent. However, investors were seen booking profits from rate sensitive Auto counter which sank over half a percent and capped the upside chances for the benchmarks.

On the global front, markets showed strength with most Asian peers gaining around half to one percent as increasing hopes that government in China would further employ measures to support world’s second largest economy and encouraging housing market report from world’s largest US economy which went on to temper concerns over deepening financial troubles in the Euro-zone.

Besides, the European markets too got off to a positive opening but major equity indices there traded with only around half a percent gains as investors remained on the sidelines after Germany reiterated its staunch opposition to common bonds to share the euro zone's debt burden ahead of a Euro-Zone Summit.

Back home, the NSE’s 50-share broadly followed index Nifty, added under half a percent gains to settle below the psychological 5,150 support level while Bombay Stock Exchange’s Sensitive Index - Sensex rose sixty one points to finish above the crucial 16,950 mark. Moreover, the broader markets too settled on a positive note with the Mid Cap index performing in tandem with its larger peers as it closed with gains of over one third of a percent.

The markets rose on large volumes of over Rs 2.12 lakh crore while the turnover for NSE F&O segment remained on the lower side as compared to that on Tuesday at over Rs 1.48 lakh crore. The market breadth remained in favor of advances as there were 1462 shares on the gaining side against 1309 shares on the losing side while 142 shares remained unchanged.

Finally, the BSE Sensex gained 61.18 points or 0.36% to settle at 16,967.76, while the S&P CNX Nifty rose by 21.10 points or 0.41% to close at 5,141.90.

The BSE Sensex touched a high and a low of 17,029.27 and 16,930.80 respectively. The BSE Mid cap index was up by 0.36% and Small cap index up by 0.32%.

Tata Steel up 2.51%, Tata Power up 2.25%, Sterlite Industries up 1.79%, Sun Pharma up 1.34% and Hindalco up 1.30% were the major gainers on the Sensex, while Tata Motors down 3.06%, Bharti Airtel down 0.42%, Wipro down 0.37%, Mahindra & Mahindra down 0.25% and SBI down 0.13% were major losers on the index.

The top gainers on the BSE sectoral space were Metal up 1.55%, Power up 1.03%, IT up 0.94%, TECk up 0.77% and Health Care up 0.52%, while Auto down 0.77%, Consumer Durables down 0.54% and Oil & Gas down 0.08% were top losers on the BSE sectoral space. 

Meanwhile, throwing a big respite for petrol consumers in India, the oil marketing companies are likely to reduce petrol prices by Rs 4/ litre from July 1 after the recent increase of Rs 7.54 a litre on May 23, the highest so far. Albeit each time one dollar depreciation the oil companies can cut down the petrol price by Rs. 0.34 a litre, every one rupee depreciation will raise the petrol prices by Rs 75-80 paise a litre.

The current crude oil price has slashed to $99 a barrel, but the oil companies will reduce the petrol prices only if crude prices continue to be steady and rupee does not fall any further against dollar.

The S&P CNX Nifty touched a high and low 5,160.10 and 5,129.25 respectively.

The top gainers on the Nifty were Sesa Goa up 3.66%, IDFC up 3.41%, Tata Steel up 2.53%, Tata Power up 2.45% and HCL Tech up 1.96%. On the flipside, Tata Motors down 3.16%, Cairn down 1.40%, Kotak Bank down 1.37%, ACC down 1.35% and JP Associates down 0.57% were the top losers on the index.

The European markets were trading in green, as France's CAC 40 up 0.44%, Germany's DAX up 0.17% and United Kingdom’s FTSE 100 up 0.45%.

Most of the Asian market ended in green today after four days of losing streak due to overnight up move in the US market but gains were reduced as doubt over the upcoming Euro Summit that the world leaders will not be able to tackle the crisis effectively.

Nikkei today rose after three days of incurring losses as investors bought shares of construction and real estate sector on the expectation that this share price will rise ahead of the sales tax increase in 2014. Shares in Hang Seng fluctuated in narrow range as decline in Chinese resource and banking centre was countered with buying shares in mainland property and consumer firm. Jakarta Composite rose for the second day due to gains in stocks of banking sector as Indonesian largest bank rose 1.4 percent and is planning to expand its business in Myanmar, Vietnam and Thailand. Shanghai Composite closed today down by 0.2 percent for the 6th consecutive day. Strait Times gained 1.1 percent after falling for the past four days as countries big and small cap stocks rose. Kospi fell due to loss incurred by the country’s biggest blue chip company Samsung Electronics.