Markets remain aggressive; Sensex up 368 points

Following global markets rallies, Indian equity markets continued trading strong after opening on a buoyant note this morning, on the back of much awaited launch of third quantitative easing by the Federal Reserve yesterday with keeping the funds rate at 0.0%-0.25% at least until mid-2015. The hike in diesel price also supported local markets to an extent. Meanwhile, India’s WPI inflation in August came in higher-than-expected at 7.55%, reducing hopes of a rate cut in the RBI’s upcoming monetary policy review on Sept 17. The inflation in food articles group stood at 9.14% as against 10.06% the month. Fuel and power group witnessed a surge in inflation to 8.32% from 5.98% a month ago. In currency markets Indian rupee appreciated to two months high level by tracing the overall weakness of dollar across the basket of major currencies. On sectoral front most rate sensitive stocks were trading high ahead of monetary policy review, while auto stocks rose in relief that the government had chosen not to slap a tax on diesel vehicles. In global markets, Asian stock markets bounded higher on Friday. Back home, the market breadth favoring positive trend; there were 1,511 shares on the gaining side against 1,048 shares on the losing side while 120 shares remain unchanged.

The BSE Sensex is currently trading at 18,389.69 up by 368.53 points or 2.04% after touching a high of 18,456.33 and low of 18,284.75. There were 29 stocks advancing against one decline on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.91% and Small cap index was up by 0.81%.

The top gaining sectoral indices on the BSE were, Realty up by 3.74%, Bankex up by 3.46%, Metal up by 3.36%, Auto up by 2.76% and Capital Goods up by 2.70%. While, Health Care down by 0.18% was the only loser on the index.

The top gainers on the Sensex were Hindalco up by 6.68%, Jindal Steel up by 5.36%, ICICI Bank up by 4.93%, SBI up by 4.14% and Tata Motors up by 4.05%. While TCS down by 0.42% was remained the only loser on the Sensex.

Meanwhile, Indian exports dropped by 9.7% in August to $22.3 billion on the global economic slowdown. The sluggish demand in Europe and US made the exports difficult. However, imports too declined 5.1% to $38 billion and ended up with a large trade deficit of $15.7 billion in August.

Commerce Secretary S R Rao said that during April-August period the exports fell about 6% from $127.6 billion to $120 billion and imports during the same period are behind by 6.2% to $191.1 billion in the same period last year. Trade deficit during the period stood at $71.1 billion. Exports had dropped 14.8% in July, giving some hope that they may stabilize at lower levels in the coming months.

SR Rao added that there is a slight improvement after the fall of exports in July. The new proposals announced in the annual supplement to Foreign Trade Policy (FTP) are possibly playing out. An improvement in the US market growth has given hope and it will sustain.

The S&P CNX Nifty is currently trading at 5,547.75, up by 112.40 points or 2.07% after trading in a range of 5,564.05 and 5,526.95. There were 46 stocks advancing against just 4 declines on the index.

The top gainers of the Nifty were Hindalco up by 6.66%, JP Associates up by 5.57%, Jindal Steel up by 5.54%, DLF up by 5.52% and Bank of Baroda up by 4.97%.

On the flip side, TCS down by 0.59%, HCL Tech down by 0.53%, Power Grid down by 0.25% and Ranbaxy down by 0.07% remained the only losers on the index.

All the Asian equity indices were trading in the green; Shanghai Composite up by 1.11%, Hang Seng index up by 2.78%, Jakarta Composite up by 2.02%, KLSE Composite up by 0.56%, Nikkei 225 up by 1.83%, Strait Times up by 1.08%, Kospi Composite Index up by 2.92% and Taiwan waited up by 2.10%.