Post session - Quick review

Benchmark equity indices of Indian equity markets showcased fervor amidst lingering uncertainty across the globe over the outcome of the tight US Presidential elections, where non-Americans from across the world, including India, want incumbent President Barack Obama to emerge victorious over his Republican rival Mitt Romney. With most of the domestic corporate earning’s being hit, investor’s found reason enough to pour in their fund into risky equities. Much of the buying that emerged in the last leg of the trade only led to the close of Dalal Street in vicinity to highest point of the session. As after getting a cautious start, markets gained momentum with the opening of European shares, which provided the required fillip to the Indian equity markets. European counters nudged higher as Americans get prepared to decide whether giving President Barack Obama another four years in White House or replacing him with Republican challenger Mitt Romney. On the flip side, Asian pacific shares closed lower on renewed doubts over Greece's ability to push through severe fiscal reforms and ahead China's Party Congress meet, scheduled to start on Thursday, as the country with Asia's largest economy is expected to unveil the next generation of Chinese leaders.

Back home, 30 share index, Sensex, of BSE, amassed over quarter percent, to conclude above the psychological 18800 level. Similarly, the widely followed index, Nifty, on NSE, too gained 4/10 percent to shut shop above the crucial 5700 bastion. Broader indices, staging a session of outperformance, went home with gains of over 0.50% (Midcap) and 0.25% (Smallcap) indices respectively. Gains of Realty, Health Care, Power and Bankex counters, mainly aided the bourses gains.

On the result front, most of the corporate earnings were hits. Drug producer Cipla, rallied over 3 percent following a 62 percent spike year-on-year in its net profit to Rs 500 crore for the quarter ended September 2012, which was above expectations. Further, software services exporter Tech Mahindra too scooped up gains of over half a percent as its second quarter consolidated net profit rose 23 percent year-on-year to Rs 296 crore, helped by new deal wins and acquisitions. Moreover, shares of public sector lender, Andhra Bank, spurted over a percent despite reporting a sluggish 3.01% rise in net profit of Rs 325.83 crore for the quarter ended September 30, 2012 as compared with Rs 316.12 crore for the same quarter.

On the flip side, Aluminum major Hindalco Industries declined over a percent and half on reporting 29% drop in net profit to Rs 259 crore for the fiscal second quarter on the back of lower realizations. Bangalore-based, Canara bank shares too edged lower on reporting more than 22% year-on-year drop in second quarter (July-September) net profit to Rs 661 crore in 2012-13 on the back of higher operating expenses and lower other income.

In the second line shares, air-conditioner-maker Voltas fell nearly 3 percent as its consolidated net profit rose 2.53 percent Y-o-Y to Rs 42.53 crore for the July-September quarter, which was below street estimates due to lower than expected other income that fell 56 percent Y-o-Y to Rs 18 crore. Jubilant Life Sciences too dropped 3 percent despite reporting of 91 percent rise in net profit to Rs 152 crore in the quarter ended September 2012 from Rs 79.4 crore in a year ago period. Amara Raja Batteries surged 15.54 percent as its net profit increased 35 percent Y-o-Y to Rs 70.1 crore during the quarter. The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1502:1338 while 138 scrips remained unchanged. (Provisional)

The BSE Sensex gained 60.71 points or 0.32% and settled at 18,823.58. The index touched a high and a low of 18,829.07 and 18,726.94 respectively. 18 stocks were seen advancing while 12 stocks were declining on the index (Provisional)

The BSE Mid-cap index was up by 0.56% while Small-cap index was up by 0.37%. (Provisional)

On the BSE Sectoral front, Realty was up by 2.07%, Health Care up by 1.00%, Bankex up by 0.74%, Power up by 0.66% and PSU up 0.44% were the top gainers, while Auto down by 0.53%, Capital Goods down by 0.24%, TECk down by 0.16%, IT down by 0.15% and Metal down by 0.03% were the only losers in the space.

The top gainers on the Sensex were Cipla up by 4.11%, GAIL India up 1.84%, HDFC up 1.76%, Jindal Steel up by 1.21% and SBI up 1.17%, while, Hindalco Industries down by 2.14%, Maruti Suzuki down by 1.88%, Tata Motors down by 1.02%, Bajaj Auto down by 0.76% and Hero MotoCorp down by 0.69% were the top losers in the index. (Provisional)

Meanwhile, amid slowing economy with sluggish investments and industrial growth, the Finance Ministry might scale down the financial growth forecasts to 5.7-6% in its mid-term review of the state of economy to be tabled in Parliament by December.

The Reserve Bank of India (RBI), in its half yearly review of the monetary policy, had lowered the financial growth projection of the country to 5.8%, from the previous forecast of 6.5%, albeit in 2012-13 budget the envisaged estimate was 7.6% growth. The RBI had blamed global and domestic factors like poor investments and subdued demand for the scale down.

Even though, the first quarter of the current financial year has registered a sluggish economic growth of 5.5%, the Planning Commission officials has expressed confidence that the economy is likely to pick up growth in the second half of 2012-13. The financial growth had slipped to nine-year low of 6.5% in 2011-12.

It is also likely to revise the fiscal deficit target, which was pegged at 5.1% of the Gross Domestic Product (GDP) in the financial budget 2012-13. The Finance Ministry had revised the fiscal deficit projection to 5.3%, considering various adverse global and domestic developments, though various global rating agencies opined that it is likely to peak to 6.1%. The panel will also consider various measures to improve the Current Account Deficit (CAD) situation. While, Chidambaram has stressed that it could improve to 3.5% of the GDP in the current fiscal, from 4.2% a year ago.

The review will also consider the peaking inflation, considering current price situation amid global and domestic factors, including the impact of monsoon on crops. RBI had recently revised the March-end inflation estimate to 7.5%, from previous projected 7%. Amid continuing attempts to promote investments to contain inflation and take India to high growth trajectory, Chidambaram last week had come up with a five-year road map for fiscal consolidation.

India VIX, a gauge for markets short term expectation of volatility gained 3.96% at 15.21 from its previous close of 14.63 on Monday. (Provisional)

The S&P CNX Nifty gained 24.95 points or 0.44% to settle at 5,729.15. The index touched high and low of 5,730.80 and 5,693.65 respectively. 33 stocks advanced against 17 declining ones on the index. (Provisional)

The top gainers on the Nifty were Cipla was up 4.23%, Asian Paints up 3.61%, Ambuja Cement up 2.71%, ACC up 2.68% and Ranbaxy Laboratories was up 2.51%. On the other hand, IDFC down 2.34%, Maruti Suzuki down by 1.89%, Hindalco Industries down by 1.83%, Reliance Infrastructure down by 1.72% and Tata Motors down by 1.07% were the top losers. (Provisional)

The European markets were trading in green with, France’s CAC 40 up 0.62%, Germany’s DAX up 0.50% and the United Kingdom’s FTSE 100 up 0.45%.

Following the sluggish start of the week, Asian markets ended mixed on Tuesday ahead of the U.S. Presidential election result. Hong Kong closed lower weighed by its largest constituent HSBC Holdings which dropped 1.4% after releasing third quarter results. In China, the Shanghai Composite went home with red mark ahead of key political events. However, South Korea's market closed in green zone, as stocks of car companies that were sold heavily on Monday regained some ground. Meanwhile, Investors were looking for economic data release from China on Friday, which includes retail sales, industrial production and the country’s consumer and producer price indexes.