Benchmarks trade higher in early deals; Nifty surpasses 6,000 level

Extending their previous sessions’ rally, Indian equity indices have made a positive start with frontline gauges surpassing their crucial 6,000 (Nifty) and 19,750 (Sensex) levels supported by firm global cues. Overnight, the US markets closed mostly higher, continuing the S&P 500 index’s record run above 1,600 after the April jobs report exceeded expectations while most of the Asian equity indices were trading in fine fettle in Tuesday’s morning trade after the European Central Bank said it is ready to cut interest rates further. Japanese Nikkei stock average opened higher by over three percent, resuming trade after a four-day long weekend.

Back home, sentiment remained firm on hopes of encouraging Index of Industrial Production (IIP) data for March to be released later this week. Sentiments also remained upbeat after foreign institutional investors (FIIs) bought shares worth Rs 897.47 crore on May 6, 2013. On the sectoral front, healthcare witnessed the maximum gain in trade followed by banking and realty while, software, consumer durables and technology remained the top losers on the BSE sectoral space. The broader indices were going neck-to-neck with benchmarks while, the market breadth on the BSE was positive; there were 838 shares on the gaining side against 396 shares on the losing side while 50 shares remain unchanged.

The BSE Sensex opened at 19,697.33; about 23 points higher compared to its previous closing of 19,673.64, and has touched a high and a low of 19,806.06 and 19,697.33 respectively.

The index is currently trading at 19,781.52, up by 107.88 points or 0.55%. There were 22 stocks advancing against 8 declines on the index.

The overall market breadth has made a strong start with 65.56% stocks advancing against 30.22% declines. The broader indices were trading in green; the BSE Mid cap and Small cap indices up by 0.54% and 0.57% respectively. 

The top gaining sectoral indices on the BSE were, Health Care up by 0.98%, Bankex up by 0.91%, Realty up by 0.90%, Capital Goods up by 0.89% and Power up by 0.82% while, IT down by 0.21%, Consumer Durables up by 0.14% and Teck down by 0.04% were the only losers on the sectoral index.

The top gainers on the Sensex were NTPC up by 2.04%, Hindalco Industries up by 1.92%, ICICI Bank up by 1.71%, BHEL up by 1.48% and Jindal Steel up by 1.30%.

On the flip side, Mahindra & Mahindra was down by 1.19%, Coal India was down by 1.13%, HDFC was down by 0.57%, Wipro was down by 0.43% and Maruti Suzuki was down by 0.41% were the top losers on the Sensex.

Meanwhile, growth in services sector, which make up nearly 60% of country’ economics output, eased dramatically during April as new orders came in at a much slower pace, prompting firms to rein in hiring plans. As per the HSBC services Purchasing Managers’ Index (PMI), based on a survey of around 400 companies, fell to its slowest pace in one and half years to 50.7 in April from 51.4 in March.  

The services sector growth which rose an 18-month high in January, fell for its third straight month in April and took the index dangerously close to the 50 mark that separates growth from contraction.  Although the business placed in firm rose during April, service providers mentioned extreme weather and challenging market conditions for the slower pace of growth.

Service providers also stated that delayed payments from clients had resulted in increased levels of unfinished business.  Moreover, the growth in payroll numbers eased in service sector and the rate of job creation was modest and the slowest in the current 14-month sequence of hiring.

Similarly, the HSBC India Composite Output Index, which measures activity in both the manufacturing and services sector, also came down to 50.5, from 51.4 in March, indicating that activity increased marginally and at the slowest pace since October 2011.  Further, April data signaled broadly steady inflation reading even as input prices continuing the trend that started in April 2009, rose during April. Subsequently, services companies increased their selling prices. However, the rate of increase in average selling prices were slower at service providers as the overall rate of charge inflation moderate and the slowest in 30 months.

Furthermore, firms operating in the Indian service sector remained optimistic towards output growth in the short-term. Service sector firms linked positive sentiment to expectations of stronger demand, increased marketing and maintained brand reputation. The degree of positive sentiment was little changed from March and remained strong.

The CNX Nifty opened at 5,983.45; about 12 points higher as compared to its previous closing of 5,971.05, and has touched a high and a low of 6,011.10 and 5,982.95 respectively.

The index is currently trading at 6,003.95, up by 32.90 points or 0.55%. There were 39 stocks advancing against 11 declines on the index.

The top gainers of the Nifty were ICICI Bank up by 1.97%, NTPC up by 1.91%, Hindalco up by 1.57%, BHEL up by 1.45% and ITC up by 1.29%.

On the flip side, Coal India down by 1.50%, M&M down by 1.29%, HDFC down by 0.82%, Ambuja Cements down by 0.70% and HCL Tech down by 0.41%, were the major losers on the index.

Most of the Asian equity indices were trading in green; Shanghai Composite rose 0.34 points or 0.02% to 2,231.51, Hang Seng increased 31.13 points or 0.14% to 22,946.22, Jakarta Composite jumped 28.12 points or 0.56% to 5,019.99, KLSE Composite surged 13.54 points or 0.77% to 1,765.56, Nikkei 225 soared 428.54 points or 3.13% to 14,122.58 and Straits Times was up by 9.43 points or 0.28% to 3,391.72.

On the flip side, KOSPI Composite declined 3.95 points or 0.20% to 1,957.53 and Taiwan Weighted was down by 5.68 points or 0.07% to 8,163.37.