Benchmarks hold early gains on firm global cues

Indian benchmarks- Sensex, Nifty were trading over 0.60% higher in the late morning session on heavy buying by funds and retail investors amid firm global cues. On the global front, most of the Asian counters made a strong start of the New Year, after a day of break, as US Senate passed a budget bill to avoid the looming fiscal cliff of $600bn tax hikes and spending cuts. Hong Kong market is the top performer so far, garnering gains of about two per cent, responding to a third straight monthly expansion in China’s manufacturing sector.  Back home, the traders were seen piling up position in Consumer Durable, Capital Goods and Metal. Gujarat Ambuja Exports gained after commencement of commercial production of maize processing unit in the state of Karnataka. HPCL, BPCL and Indian Oil Corporation edged higher after the Petroleum ministry stated that the under-recovery on High Speed Diesel has decreased to Rs 9.03 per litre applicable for the first fortnight of January 2013. Bajaj Auto jumped after the company has stated that its total vehicle sales rose 13% to 3.43 lakh units in December 2012 over December 2011. Glenmark Pharmaceuticals soared after the company has stated that USFDA has provided marketing approval to the company's partner in US, Salix Pharmaceuticals, for Crofelemer 125 mg delayed-release tablets. Tata Motors jumped 52-week high after reporting total sales of commercial and passenger vehicles at 65,582 units (including exports) during December. Hero MotoCorp surged after the company's total sales rose 8% to 5.41 lakh units in December 2012 over November 2012. Reliance Industries was trading in green after the company has stated that it has bought back 4.62 crore shares for about of Rs 3358.91 crore till 24 December 2012 under its ongoing share buyback program. The NSE Nifty and BSE Sensex were managing to hold their psychological 5,950 and 19700 levels respectively. The market breadth on BSE was positive, in the ratio of 1533:628.

The BSE Sensex is currently trading at 19701.19 up by 120.38 points or 0.61% after trading in a range of 19731.65 and 19686.50. There were 26 stocks advancing against 4 declines on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.67% and Small cap index was up by 0.82%.

 The top gaining sectoral indices on the BSE were, Consumer Durable by 1.45%, Capital Goods up by 1.31%, Metal up by 1.05%, Power up by 0.97% and Bankex up by 0.90%. While, there were the no losers.

The top gainers on the Sensex were BHEL up by 2.15%, Maruti Suzuki up by 1.77%, Bajaj Auto up by 1.58%, Sterlite Industries up by 1.39%, Hindalco Industries up by 1.34%.

On the flip side, Mahindra & Mahindra was down by 0.56%, Hindustan Unilever was down by 0.41% , Wipro was down by 0.29%, HDFC Bank was down by 0.05%  and ITC was down by 0.03% were the top losers on the Sensex.

Meanwhile, signaling further improvement in the health of the Indian manufacturing sector, the seasonally adjusted HSBC Purchasing Managers’ Index, a composite indicator of operating conditions in the manufacturing economy posted a good advancement in December, by surging to its six-month high to 54.7 from 53.7 in November, its biggest monthly rise since January 2012.

Boosted by strong factory output and a spike in new orders, both of which hit their highest levels since June, Indian goods-producing sector has shown output growth advancement for the forty-fifth consecutive month. The PMI index has now stayed above the 50 mark that separates growth from contraction for almost four years.

New orders and export sales both increased at manufacturing companies in India during December. While, the volume of incoming new work at manufacturers in India increased in December. The rate of growth was sharp, and the fastest in six months. New export orders also expanded, and at a solid pace.  The new orders sub-index in the survey, a reliable gauge of future output, jumped to 58.0 from 55.8 in November, its biggest monthly jump since April, indicating that the factory sector might be in for better days ahead.

Further, December data signalled job creation in the Indian goods-producing sector, amid reports of higher production requirements. However, labour shortages and demand for higher salaries weighed on payroll numbers.

Meanwhile, input prices in the Indian manufacturing sector also rose for the forty-fifth consecutive month. According to the companies monitored, the rise in input costs reflected increased raw material prices, stronger demand and un-favourable exchange rates. Consequently, average selling prices rose again.

Nevertheless, the survey, which expects higher growth on account of firmer demand, also pointed at Inflation pressures remaining firm in the coming months. However, after rising to the highest level in the year for the month of September, the wholesale price index (WPI), India's main inflation gauge, unexpectedly cooled down to 7.24% (Provisional) for the month of November, 2012.

 The S&P CNX Nifty is currently trading at 5,989.75 up by 38.90 points or 0.65% after trading in a range of 5,997.75 and 5,982.00. There were 46 stocks advancing against 4 declines on the index.

The top gainers of the Nifty were JP Associate up by 2.84%, BHEL up by 2.28%, Punjab National Bank up by 2.25%, Maruti Suzuki up by 1.94% and Bajaj-Auto up by 1.87%.

On the flip side, Mahindra & Mahindra down by 0.57%, HUL down by 0.39%, Wipro down by 0.30% and ITC down by 0.05% were the only losers on the index.

Most of the Asian equity indices were trading in green; Hang Seng soared 433.11 points or 1.96% to 23,100.03, Jakarta Composite rose 31.60 points or 0.73% to 4,348.28, Straits Times surged 40.94 points or 1.30% to 3,208.02, KOSPI Composite added 33.25 points or 1.66% to 2,030.52 and Taiwan Weighted was up by 69.95 points or 0.91% to 7,769.45.

On the flip side, KLSE Composite was down by 13.16 points or 0.78% to 1,675.79.

Markets in Japan and China are closed for trade on account of public holidays and will reopen on Friday.