Markets make gap up start tracking firm cues from Asian markets

After witnessing massacre of over a percent, Indian benchmarks have made a gap-up opening with the NSE Nifty climbing back above its crucial 5,700 mark amid firm cues from other Asian counters. Most of the Asian equity indices were trading in the green at this point of time with Chinese and Hong Kong markets surging by over a percent on speculation that China will add to measures to boost growth after IMF cut its global economic growth forecasts. Though, the US markets continued their declining trend with the start of new week and traders remained cautious ahead of the earning season starting from Tuesday, also the trading remained light owing to the Columbus Day holiday for the US government and the bond market.

Back home, sustained buying in mostly all the key heavyweights along with broader indices supported BSE’s -- Sensex -- and NSE’s -- Nifty -- to regain their crucial 18,800 and 5,700 mark respectively. The gains came despite a sharp downward revision in India’s 2012 growth forecast by the International Monetary Fund. It expects India GDP for 2012 at 4.9 per cent, perhaps the most pessimistic growth outlook by a global body. IMF lowered its forecast despite the government unleashing a series of reforms to attract foreign investment and boost business sentiment in the country. The government has also undertaken a series of steps to contain rising fiscal deficit in the hope of thwarting a downgrade by rating agencies.

Meanwhile, the Iron companies like SAIL, JSW Steel, Tata Steel and Jindal Steel all edged higher on report that mines minister Dinsha Patel has asked finance minister to immediately roll back the export duty on iron ore from 30% to 15%. All the sectoral indices are up 0.3-1.3 percent each. The BSE metal index is the top gainer, garnering over a percent points. Capital goods, banking, healthcare and consumer durables also garnered over a percent point. Moreover, FMCG, auto, power and PSU indices have also advanced over half a percent each in the opening deals. The broader indices too were going neck-to-neck with benchmarks and market breadth on the BSE was strong; there were 1,218 shares on the gaining side against 413 shares on the losing side while 61 shares remain unchanged.

The BSE Sensex opened at 18796.25; about 88 points higher compared to its previous closing of 18708.98, and has touched a high of 18885.84 while low remain its opening.

The index is currently trading at 18845.80, up by 136.82 points or 0.73%. There were 26 stocks advancing against only 4 declines on the index.

The overall market breadth has made a strong start with 71.99% stocks advancing against 24.41% declines. The broader indices too were trading in-line with benchmarks; the BSE Mid cap and Small cap indices rose 0.83% and 0.76% respectively.

The top gaining sectoral indices on the BSE were, Metal up by 1.24%, CG up by 1.21%, Bankex up by 1.18%, HC up by 1.03% and CD up by 1.03%. While, there were no losers on the index.

The top gainers on the Sensex were Tata Steel up by 1.73%, ICICI Bank up by 1.59%, Jindal Steel up by 1.56%, Sterlite Industries up by 1.49% and Sun Pharma up by 1.49% while, Bajaj Auto down by 1.38%, Bharti Airtel down by 0.98%, Wipro down by 0.70% and Infosys down by 0.08% remained the only losers on the Sensex.

Meanwhile, with the continuing reform measures to improve the growth of Indian economy amid stiff opposition, the centre heaved a sigh of relief as a survey held by Assocham revealed that India Inc's business confidence has shown a remarkable improvement since August. It has noted that the recent reforms like allowing FDI in multi-brand retail, aviation and approving hike in foreign investment in insurance have bolstered the current positive sentiments. It also expressed hopes that the current outlook might aid for a sharp recovery in nation’s financial growth in next three months.

In the survey conducted, nearly 70 % of the 245 CEOs who participated opined that the GDP growth in 2012-13 will not be below 6%, and majority of them remained confident that there is less chance for any political threat for the government and hoped that it will complete its full term. It also indicated that last two month's speed in taking reforms might continue for at least six more months and also anticipated that the Prime Minister Manmohan Singh would remain firm on his grounds and not likely to roll back the reforms.

The trade body also suggested that the demand should return to the consumer durables that one or two big ticket multi-billion infrastructure projects has to be taken off, while it appreciated centre’s approval for FDI in pension funds and power exchanges. It also commented that the exports for the year might fall below the target of $360 billion amid Euro-zone crisis.

The S&P CNX Nifty opened at 5,708.15; about 32 points higher compared to its previous closing of 5,676.00, and has touched a high of 5,728.65 while low remained its opening.

The index is currently trading at 5,717.65, higher by 41.65 points or 0.73%. There were 44 stocks advancing against 6 declines on the index.

The top gainers of the Nifty were JP Associates up by 2.33%, Lupin up by 1.96%, Tata Steel up by 1.69%, ICICI Bank up by 1.63% and Jindal Steel up by 1.59%.

On the flip side, Bajaj Auto down by 1.63%, Bharti Airtel down by 1.29%, DLF down by 1.03%, Wipro down by 0.73% and Power Grid down by 0.59% remained the top losers on the index.

Most of the Asian equity indices were trading in the green; Shanghai Composite was up by 41.65 points or 2.01% to 2,116.07, Hang Seng was higher by 229.12 points or 1.10% to 21,053.68, Jakarta Composite was up by 15.32 points or 0.36% to 4,283.62, KLSE Composite was marginally up by 1.77 points or 0.11% to 1,661.99, Straits Times gained 3.41 points or 0.10% to 3,079.08 and Kospi Composite was up by 6.64 points or 0.33% to 1,987.82.

Nikkei 225 was the lone loser, down by 31.99 points or 0.36% to 8,831.31 and Taiwan Weighted lost 12.98 points or 0.17% to 7,602.91.