Rally of Power stocks lift markets to day’s high; positive European markets opening too boosts sentiment

Benchmark equity indices have escalated to day’s high mainly on account of aggressive buying in Power stocks, which besides lifting the pivotal higher have also aided sentiment at D-Street. Power stocks rallied after Cabinet Committee on Economic Affairs (CCEA) approved coal price pass-through mechanism, which will allow the power companies to pass the entire additional cost of imports to consumers as against the averaging of prices of imported and domestic coal under the earlier planned price-pooling mechanism. Additionally, a positive opening of European counterparts also provided the required fillip to the markets. Benchmark 30 and 50 share indexes, Sensex and Nifty, puffing gains of over quarter of a percent, were trading above the psychological 18,750 and 5,650 mark respectively. Meanwhile, broader indices continued to trade on mixed note.

On the global front, shrugging off weak Asian counterparts, European shares rose on Friday, steadying after the previous session's hefty falls on the prospect of diminished stimulus from the US Federal Reserve, though traders were braced for a choppy ride in the medium term. Closer home, besides power, Oil & Gas and Information Technology counters are also notable gainers. On the flip side, Metal and Health Care counters are the only dark spot of the trade. The overall market breadth on BSE is in favour of advances, which have thumped declines in the ratio of 1099:961; while 131 shares remain unchanged.

The BSE Sensex is currently trading at 18,781.02, up by 61.73 points or 0.33% after trading in a range of 18,799.37 and 18,615.14. There were 21 stocks advancing against 9 declines on the index.

The broader indices were trading on mixed note; the BSE Mid cap index was down by 0.15% and Small cap index was up by 0.40%.

The only gaining sectoral indices on the BSE were Power up by 1.29%, Oil & Gas up by 1.11%, Information Technology up by 0.86%, Teck up by 0.84% and PSU up by 0.53%, while Metal down by 0.29% and Health Care down by 0.26% were the top losers on the BSE.

The top gainers on the Sensex were Tata power up by 3.09%, Hero MotoCorp up by 2.14%, ONGC up by 1.88%, NTPC up by 1.36% and BHEL up by 1.34%. On the flip side, Jindal Steel down by 3.11%, Hindalco Industries and Sun Pharma were down by 1.74%, ICICI Bank down by 0.78% and HDFC was down by 0.67% were the top losers on the Sensex.

Meanwhile, with the rise in prices of food items and fuel, the inflation based on consumer price index (CPI) for agricultural labourers (AL) and rural labourers (RL) increased in May as compared to the previous month. The point-to-point rate of inflation based on the Consumer Price Index-Agriculture Labour (CPI-AL) and Consumer Price Index-Rural Labour (CPI-RL) rose to 12.70 per cent and 12.50 per cent in May from 12.32 per cent and 12.15 per cent in April, 2013.

The index varied from state to state and the index for agriculture workers recorded an increase which varied between 3 to 19 points in 19 states and a decrease of 11 points in one state. On the other hand, the retail inflation index for rural workers registered an increase between 2 to 20 points in 19 states and a decrease of 10 points in one state.

State wise, West Bengal registered the maximum increase of 19 and 20 points, respectively for farm and rural workers, on account of rise in the prices of food articles including rice, wheat, meat goat, fish fresh and ginger among others while, Bihar registered a decline of 11 points and 10 points, for CPI-AL and CPI-RL. Meanwhile, Karnataka topped the index table for CPI-AL and CPI-RL with 792 and 789 points, while Himachal Pradesh with an index level of 560 points and 592 points stood at the bottom.

The CNX Nifty is currently trading at 5,674.45 up by 18.55 points or 0.33% after trading in a range of 5,679.65 and 5,616.85. There were 35 stocks advancing against 13 declines while 2 stocks remains unchanged on the index.

The top gainers of the Nifty were Indusind Bank up by 3.88%, Tata Power up by 2.96%, ONGC up by 2.20%, Hero MotoCorp up by 2.15% and Reliance Infra up by 1.52%. On the flip side, Jindal Steel down by 2.88%, Bank of Baroda down by 2.37%, Hindalco Industries down by 1.89%, Sun Pharmaceuticals down by 1.82% and ACC down by 1.48% were the major losers on the index.

Most of the Asian equity indices were trading in red; Shanghai Composite declined 0.31%, Hang Seng tumbled 0.68%, Jakarta Composite declined 2.04%, KLSE Composite dipped 0.39%, Straits Times dropped 0.35%, KOSPI Composite contracted 1.49% and Taiwan Weighted plunged 1.34%. 

On the flip side, Nikkei 225 grew by 1.66% were the sole gainer.

European markets got off to a positive start; with CAC 40 adding 0.79%, DAX rising 0.37% and FTSE 100 gaining 0.61%.