Post session - Quick review

Jubilation prevailed at D-street for second straight session as bolstered risk appetite after ‘Fiscal Cliff’ drama was resolved by final vote, giving a shot of adrenaline to Indian benchmark equity indices, besides the globe, led to over half a percent gains at D-street. After fervent New Year brinkmanship, the US Congress on Tuesday finally backed a deal to avert a 'fiscal cliff' of tax hikes and slashing spending cuts that had threatened to unleash economic calamity.

Sentiments at D-street were also buttressed by good macro-economic data. Boosted by strong factory output and a spike in new orders, both of which hit their highest levels since June, India's manufacturing activity surged to a six-month high in December.

Thus, building on previous session, 30 share index, Sensex, accumulating over century of points, rallied close to 2 years high level of 19700 mark. In the Similar fashion, barometer 50 share index, Nifty, too surging close to 3/ 4 percent, ended sub psychological 6000 level, its highest since January 7, 2011.  Both, Sensex and Nifty faced stern resistance at 19750 and 6000 respective levels. Profit-booking, which was encountered at higher levels in the early noon deals, mainly pared bourses’ some of the early gains. On the global front, with no price for guessing, fiscal cliff deal led to gains in both Asian and European markets. However, some of the gains in European markets could be tempered after reports suggested Activity among euro-zone manufacturers continued to shrink in December, as factories across the currency area's biggest economies curbed their output.

Back on the home turf, although buying was broad-based, yet stocks from Consumer Durables, Capital Goods and Oil & Gas counters, made to top gainers. While, bout of profit-booking which witnessed in the last hour of trade that dragged the benchmarks to intra-day’s low by its close, also dragged the Fast Moving Consumer Goods and Information Technology counters in the red zone. Additionally, banking shares gained traction for the second consecutive session as hopes rate cut in January gathered steam. Some amount of supported also came in from Auto space which gained by about a percent as companies like Hero MotoCorp, Atul Auto and Bajaj Auto registered decent gains in December sales. Further, sugar stocks, namely, Balrampur Chini, Shree Renuka Sugars, Bajaj Hindusthan and EID Parry ended on mixed note after Sugar production in the first three months of the 2012-13 sugar year was up 2.5 per cent at 7.96 million tonnes over the corresponding period last year. Also, gains of select blue chip stocks, aided the rally. Shares of Bharat Heavy Electricals (BHEL) were up 3 per cent on Wednesday after the government imposed a 35 per cent safeguard duty on electrical insulators imported from China, in a bid to protect domestic manufacturers from cheaper shipments. Furthermore, even Reliance Industries and ICICI Bank scooped up gains of close to and over a percent.

The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1766:1184 while 151 scrips remained unchanged. (Provisional)

The BSE Sensex gained 124.38 points or 0.64% and settled at 19705.19. The index touched a high and a low of 19756.68 and 19686.50 respectively. 22 stocks were seen advancing while 8 stocks were declining on the index (Provisional)

The BSE Mid-cap index was up by 0.53% while Small-cap index was up by 0.89%. (Provisional)

On the BSE Sectoral front, Consumer Durables was up by 1.69%, Capital Goods up by 1.34%, Oil & Gas up by 1.11%, PSU up by 0.99% and Bankex up 0.96% were the top gainers, while FMCG down by 0.22%, IT down by 0.17% and Realty down by 0.04% was the only loser in the space.

The top gainers on the Sensex were Bajaj Auto up by 3.32%, Maruti Suzuki up 3.23%, BHEL up by 2.38%, ONGC up by 2.17% and Gail India up 2.02%, while, Mahindra & Mahindra down by 0.56%, ITC down by 0.54%, Wipro down by 0.44%, TCS down by 0.27% and Coal India down by 0.17% were the top losers in the index. (Provisional)

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.

India VIX, a gauge for markets short term expectation of marginally gained 0.14% at 13.71 from its previous close of 13.69 on Tuesday. (Provisional)

The S&P CNX Nifty gained 41.00 points or 0.69% to settle at 5,991.85. The index touched high and low of 6,006.05 and 5,982.00 respectively. 35 stocks advanced against 15 declining ones on the index. (Provisional)

The top gainers on the Nifty were Bajaj-Auto was up 3.66%, JP Associate up 3.40%, Maruti Suzuki up 3.28%, BPCL up 3.14% and IDFC was up 3.08%. On the other hand, Asian Paint down by 0.97%, Bharti Airtel down by 0.65%, ITC down by 0.59%, Mahindra & Mahindra down by 0.54% and Wipro down by 0.48% were the top losers. (Provisional)

The European markets were trading in green with, France’s CAC 40 up by1.99%, Germany’s DAX up by 2.01% and the United Kingdom’s FTSE 100 up by 1.82%.

Asian markets ended mostly higher on the first trading day of the year as the US Congress backed a deal to avert a fiscal cliff of drastic tax rises and spending cuts in an upbeat start to the year for regional markets. Hong Kong closed higher after touching 19-month high as China's manufacturing sector continued to grow. Moreover, benchmarks in Singapore, Taiwan, the Philippines, Thailand and Indonesia posted solid gains.

Markets in Japan and China remained shut for public holidays and will reopen on Friday.