Strong trade continues in market; Nifty breaches 5,600 mark

Indian equity markets remained well entrenched in positive territory in the late morning session on Tuesday amid strong and sustained buying in several blue chip stocks. The Sensex climbed 223 points, while Nifty breached 5,600 mark. Investors were busy picking up stocks despite weak global cues, amid rate cut hopes in the next monetary policy following a significant drop in inflation. Market sentiments was also boosted with the sharp fall in the gold prices, as lower commodity prices is expected to reduce the pressure on the country's record current account deficit. In currency markets, rupee appreciated against dollar on the back of increased selling of the US currency by exporters. On the sectoral front, capital goods, power, bank and automobile stocks were trading mostly up with impressive gains. Stocks from FMCG, PSU and realty sectors were also trading firm, while information technology and consumer durables stocks remain subdued. Meanwhile, Indian gold loan providers continued to decline on Tuesday on the back of sharp decline in gold prices, potentially reducing the value of collateral against lending held by these companies.

On the global front, Asian shares were trading mixed after two explosions at the Boston Marathon in the US, following weak economic data, falling commodity prices and big losses on Wall Street. Back home, the market breadth was favoring positive trend; there were 1,063 shares on the gaining side against 799 shares on the losing side while 116 shares remain unchanged.

The BSE Sensex is currently trading at 18,581.06, up by 223.26 points or 1.22% after trading in a range of 18,603.11 and 18,325.73. There were 23 stocks advancing against 7 declines on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.59% and Small cap index was up by 0.39%.

The top gaining sectoral indices on the BSE were, Bankex up by 1.92%, Capital Goods up by 1.74%, Power up by 1.58%, FMCG up by 1.39% and Auto up by 1.25% while, IT down by 0.61%, Metal down by 0.30% and Teck down by 0.23% were the top losers on the BSE.

The top gainers on the Sensex were Hero MotoCorp up by 2.90%, HDFC up by 2.60%, Tata Power up by 2.60%, Mahindra & Mahindra up by 2.54% and Maruti Suzuki up by 2.40%.

On the flip side, Sterlite Industries was down by 2.38%, Infosys was down by 1.02%, TCS was down by 0.62%, Jindal Steel was down by 0.24% and Tata Motors was down by 0.17% were the top losers on the Sensex.

Meanwhile, fall in international oil prices have prompted the oil marketing companies (OMCs) to slash petrol price by Re 1 per litre - third reduction in rates in one month, effective April 15 midnight. The price cut, which was made possible, excludes local sales tax or VAT. However, diesel prices were left untouched, even though April 15 was the appointed day for putting into effect the government decision to hike rates by 40-50 paise a litre. Diesel price was last increased on March 23, by 45 paise.

After including VAT, the reduction in petrol price in Delhi comes to Rs 1.20 per litre and the fuel will cost Rs 66.09 per litre against Rs 67.29, in Mumbai it will cost Rs 1.26 less at Rs 72.88 per litre. In Chennai, the price has been cut by an equal measure to Rs 69.08 and in Kolkata it will cost Rs 73.48 a litre against Rs 74.72.

Since the last price revision, the international prices of petrol have gone down from $119.23/bbl to $116.61/bbl. Normally, oil firms review the price of petrol every two weeks. Petrol price was last revised on April 3, when it was reduced by 85 paise (without taxes), further on March 16 it was decreased by Rs 2 a litre and including VAT translated into a Rs 2.40 a litre reduction at pumps - the steepest cut in 9-month.

Though, petrol price has been deregulated since June 2010 and the price is market determined, the government still controls the price of diesel, and allows only minor revisions. The government had only this January allowed oil companies to increase the price of diesel by 40-50 paisa per litre every month until the companies have wiped out the losses they incur from having to sell diesel at subsidized rates.

The CNX Nifty is currently trading at 5,629.55 up by 61.15 points or 1.10% after trading in a range of 5,642.35 and 5,555.85.

There were 37 stocks advancing against 13 declines on the index. The top gainers of the Nifty were Hero Moto Corp up by 2.90%, Tata Power up by 2.87%, M&M up by 2.76%, HDFC up by 2.71%, and Maruti Suzuki up by 2.44%.

On the flip side, Ambuja Cements down by 1.62%, Cairn down by 1.50%, Sesa Goa down by 1.36%, Lupin down by 1.13%, and Infosys down by 1.21%, were the major losers on the index.

Asian equity indices were trading mixed; Hang Seng dropped 0.11%, KLSE Composite slipped 0.22%, Nikkei 225 decreased 0.18%.

On the flip side, Shanghai Composite up by 0.02%, Jakarta Composite rose 0.64%, Straits Times added 0.07%, Taiwan Weighted was up by 0.48% and KOSPI Composite was up by 0.17%.