Post session - Quick review

The new month F&O series was received well by Indian equity markets, which incurring heavy losses in the previous trading session, lured significant traction to end the last trading session of the week, with gains of over half a percent. After staring on a positive note, benchmark equity indices building on significant gains, concluded near day’s highest point thanks to sustained buying by funds and retail investors tracing sanguine regional counterparts. Revival of global risk sentiment on hopes that fiscal cliff issue in the US would be soon resolved activating the hibernating bulls, mainly spurred gains at D-street.

Thus, after starting on positive note, 30 share index, Sensex, on BSE puffing close to century of points, concluded at above 19450 psychological level. In the similar fashion, 50 share widely followed index, Nifty, too adding over 3/ 4 percent, finished above 5900 bastion. Meanwhile, Midcap index, outperforming frontline equity indices mustered gains of over 8/10 percent, while BSE Smallcap index, too ended up with gains of 3/10 percent. For the week, both Sensex and Nifty both ended up with over a percent gains, while CNX Midcap index outperforming frontline equity indices accumulated profit of over one and half percent against the 2/10 percent gains of BSE Smallcap index.

On the global front, Asian stocks extended gains Friday as investors held on to hopes U.S. lawmakers could still reach an agreement before the year-end to avert the fiscal cliff, with Japanese shares ending 2012 on a high note as the yen fell to levels which was last seen in 2010. The broad region-wide rally came as President Barack Obama called on congressional leaders to the White House Friday for talks on a pact to avert imminent tax increases and spending cuts that are feared to potentially drag the world's largest economy into a recession. Additionally, US budget worries pegged back European shares.

Closer home, except for Health Care, Bankex and Realty, all the BSE sectoral indices ended in green. Yet, strong buying in Oil & Gas, Information Technology and Public Sector Undertaking counters, mainly kept the undertone positive for D-street. Oil companies led the gainers pack of BSE Oil companies after petroleum ministry proposed a gradual rise in diesel prices, by 1 rupee a litre every month over a 10-month period. Hindustan Petroleum Corporation (HPCL), Indian Oil Corporation (IOC) and Bharat Petroleum Corporation (BPCL) rallied in the range of 3-4% each. Software pack too supported the rally, surging by about a percent on hopes the US lawmakers will try to reach a deal to break the budget impasse before the end of the year, since these firms derive lion share of their revenue from exports. Additionally, Auto space too made a positive close as stocks like Maruti Suzuki, Hero MotoCorp and Bajaj Auto surged ahead of outcome December sales figures starting January 1, 2013. Meanwhile, Bharti Infratel's made disastrous debut in a bullish market, as stocks ended at a discount of 13% at Rs 191.20 from the issue price of Rs 220.

The BSE Sensex gained 130.96 points or 0.68% and settled at 19454.76. The index touched a high and a low of 19465.74 and 19346.07 respectively. 22 stocks were seen advancing while 8 stocks were declining on the index (Provisional)

The BSE Mid-cap index was up by 0.76% while Small-cap index was up by 0.29%. (Provisional)

On the BSE Sectoral front, Oil & Gas was up by 2.71%, IT up by 1.19%, Consumer Durables up by 0.92%, PSU up by 0.88% and TECk up 0.87% were the top gainers, while Health Care down by 0.11% was the only loser in the space.

The top gainers on the Sensex were RIL up by 3.29%, ONGC up 2.51%, Sterlite Industries up 2.41%, Infosys up by 1.44% and Gail India up 1.43%, while, Tata Steel down by 0.91%, Mahindra & Mahindra down by 0.72%, SBI down by 0.66%, Sun Pharma down by 0.52% and HDFC Bank down by 0.35% were the top losers in the index. (Provisional)

Meanwhile, on the back of moderating industrial growth, India may not be able to meet investment target and 100 million job opportunities by 2022 envisaged by the government in the National Manufacturing Policy (NMP), as per the CII report. According to the CII-BCG report, by considering the moderate growth forecast by top management of manufacturing companies, the NMP targets for 2022 might be missed by a wide margin and India might end up losing $350 billion in incremental manufacturing GDP and also expected to create 70 million less jobs.

On the manufacturing sector, the report said that it has seen a slowdown during the last two years. Besides global crisis, domestic issues like regulatory burden, poor infrastructure, land acquisition, inflexible labour laws have contributed to the declining business confidence and fall in investments in the sector. Whereas in the NMP, the government expects to enhance the share of manufacturing in the GDP to 25 percent within a decade from 16-17 percent at present. 

On survey of over 70 senior representatives of top Indian manufacturing companies, 75 percent said that they expect the growth of manufacturing sector to be less than 7 percent. Industrial growth was 1.2 percent in the April-October period of current fiscal, which was less than 3.6 percent in the same period of previous fiscal. Further, to boost the manufacturing sector in India, the CII-BCG report recommended various steps that include setting up of an industry-government institutional framework to achieve the industrial agenda, which would be responsible for coordination across relevant diverse departments.

Moreover, the report said that the current restructuring of the global manufacturing opens a lot of opportunity for India, which will be done if India fixes the basic enablers, since countries like Indonesia, Thailand, Malaysia and Mexico are already building on the low cost competitive advantage by multiple actions.  The report also added that government should also increase investment in R&D and innovation as India is lagging behind its peers and spends less than 1 percent of its GDP in R&D and it also requested the private sector to aggressively invest in innovation and R&D.

India VIX, a gauge for markets short term expectation of volatility lost 0.80% at 13.63 from its previous close of 13.74 on Thursday. (Provisional)

The S&P CNX Nifty gained 38.40 points or 0.65% to settle at 5,908.50. The index touched high and low of 5,915.75 and 5,879.50 respectively. 35 stocks advanced against 14 declining and one remain unchanged on the index. (Provisional)

The top gainers on the Nifty were Reliance was up 3.22%, ONGC up 2.93%, BPCL up 2.46%, WIPRO up 1.70% and Infosys was up 1.70%. On the other hand, Axis Bank down 0.69%, SBI down by 0.65%, Mahindra & Mahindra down by 0.60%, HDFC Bank down by 0.57% and Sun Pharma down by 0.54% were the top losers. (Provisional)

The European markets were trading in red with, France’s CAC 40 down by 0.66%, Germany’s DAX down by 0.26% and the United Kingdom’s FTSE 100 down by 0.02%.

Asian equity markets extended earlier sessions gains and ended higher on Friday with Japan’s Nikkei touching a fresh yearly high for a second consecutive session on the back of persistent weakness in the yen. Shanghai Composite went home with strong gains as banking stock rallied on policymakers' supportive stance towards financial reforms. Investors were expecting some major cues from the US fiscal cliff talks this weekend. Kospi Composite closed higher but Korean automakers were weighed down by the lower yen which gives their Japanese rivals a competitive edge in exports.