Re-energized bulls take Nifty near crucial 5,900 bastion; Sensex surges around 1%

Boisterous benchmarks showcased yet another enthusiastic performance on Monday with frontline indices rallying vehemently by about a percentage point. Indices not only extended their gaining streak for the third successive session but also soared to highest levels in last one month. The key bourses drew comfort after foreign institutional investors (FII) bought shares worth Rs 11.24 billion on June 28, 2013, snapping a 13-day selling streak. There was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too equally participated in the rally. Both the frontline indices ended the session near their psychological levels of 19,600 (Sensex) and 5,900 (Nifty).

Surprisingly, the beaten down realty sector surged in the day, emerging as the top gaining sectoral indices on the back of short covering. Some support also came in after Prime Minister Manmohan Singh stated that the government aims to invest Rs 1.15 lakh crore in PPP (public private partnership) projects across infrastructure sectors in rail, port and power in the next six months. Meanwhile, Indian factory activities remained weak in June as output contracted for the second consecutive month and order books contracted for the first time in over four years. However, consistent with a marginal expansion of the country’s manufacturing sector, the HSBC Purchasing Managers’ Index (PM) recorded above the no-change threshold for the fifty-first consecutive month in June, by coming at 50.3, slightly higher from 50.1 in May.

Domestic markets gained further following firm opening in European counterparts. CAC, DAX and FTSE all edged higher by half a percent ahead of the release of a raft of factory activity data from across the region, which will throw more light on the health of the European Union's economies. However, Asian markets ended mostly in the red as sentiments got dampened after Chinese factory activity shrank for a second consecutive month in June and reached its lowest in nine months as new orders fell despite price cuts by producers.

Back home, northward journey continued after the Confederation of Indian Industry (CII) made a strong push for speedy action to implement the proposed Goods and Service Tax (GST) and have said that the industry hopes that political developments would not overshadow its progress. Rally in public sector oil marketing companies (PSU OMCs) too aided sentiments as IOC, BPCL and HPCL all edged higher after raising petrol price by Rs 1.82 a litre, excluding local sales tax or VAT, with effect from midnight of June 28, 2013. Actual increase will be higher and will vary from city to city depending on local taxes. Additionally, power equipment maker gained on hopes that higher natural gas prices would lead to higher orders from gas-based power producers.

The NSE’s 50-share broadly followed index Nifty gained over fifty points to end near its psychological 5,900 support level, while Bombay Stock Exchange’s Sensitive Index - Sensex zoomed by over one hundred and eighty points to finish over its psychological 19,550 mark.

Moreover, the broader markets too traded jubilantly and ended the session with a gain of about two percent. The market breadth remained in favor of advances as there were 1,611 shares on the gaining side against 768 shares on the losing side while 127 shares remain unchanged.

Finally, the BSE Sensex gained 181.58 points or 0.94% to settle at 19,577.39, while the CNX Nifty rose by 56.65 points or 0.97% to end at 5,898.85.

The BSE Sensex touched a high and a low of 19,598.43 and 19,347.57, respectively. The BSE Mid cap index was up by 1.81% and Small cap index was up by 1.95%.

The top gainers on the Sensex were, Maruti Suzuki up by 4.37%, Sterlite Industries up 3.89%, GAIL up 3.27%, L&T up 3.26% and SBI up by 3.17%, while Infosys down by 1.83%, TCS down 1.76%, ONGC down 0.55%, Sun Pharma down 0.44% and HDFC Bank down 0.19% were the top losers on the index. 

The top gainers on the BSE Sectoral space were, Realty up 5.26%, Capital Goods up 2.77%, Power up 2.77%, FMCG up 2.11% and Metal up 1.97%, while IT down 1.60%, TECk down 0.44% were top losers on the sectoral space.

Meanwhile, the government will borrow Rs 1.56 lakh crore in the July-September quarter through the auction of Treasury Bills to meet their financing requirements. The government, in consultation with the Reserve Bank of India (RBI), has notified amounts for the issuance of T-Bills for the, following a review of its cash position. As per the auction calendar, the government will raise Rs.12,000 crore on every Wednesday each week starting July 3 till September 25, to mop up a total amount of Rs.1.56 lakh crore during the second quarter of 2013-14.

Currently, the gross market borrowing through issue of dated securities in this fiscal has been pegged at Rs 5.79 lakh crore and the net borrowing will be at Rs 4.84 lakh crore against Rs 4.67 lakh crore in 2012-13. The front-loading of borrowing is mainly targeted at making available capital to the private sector in the last six months of current fiscal year.

In current fiscal, government has to borrow funds from market to finance the fiscal deficit estimated to be 4.8% against 4.9 % in 2012-13. It is expecting to collect Rs 40,000 crore from disinvestment, Rs 15,000 crore from sale of remaining stakes in the companies and healthy growth in tax collection in current fiscal to fund its expenditure.

The CNX Nifty touched a high and low of 5,904.35 and 5,822.20 respectively. 

The top gainers on the Nifty were Ranbaxy up 5.19%, Reliance Infra up 5.10%, DLF up 4.33%, Sesa Goa up 3.89% and JP Associates up by 3.73%.

On the flip side, the top losers of the index were Infosys down 2.24%, HCL Tech down 1.93%, TCS down 1.92%, ONGC down 0.85% and Sun Pharma down by 0.70%.

The European markets were trading in green, France’s CAC 40 up by 0.72%, the United Kingdom’s FTSE 100 up by 0.49% and Germany’s DAX up by 0.39%.

Asian Markets shut the shop on mixed note, as Chinese manufacturing data weighed on the market sentiments. Japan’s Nikkei went home with strong gains as the yen weakened against the dollar.  Chinese market too closed marginally higher after China's manufacturing sector showed fresh signs of weakness in June, against a background of strains in the country's financial markets and an effort to rebalance the economy. Korean markets’ ended lower as HSBC data released for the day showed that the country's manufacturing activity contracted for the first time in five months in June.

Hong Kong's markets were closed for the Hong Kong Special Administrative Region Establishment Day holiday.