Post Session: Quick Review

Last sessions jubilation got extended for the Indian equity markets and despite some intraday sluggishness, the local benchmarks strengthened further to over their one and half months high on Friday. The days’ gains were majorly induced by the better than expected first quarter numbers of IT bellwether Infosys. The company defying the expectations left FY14 sales growth guidance in dollar terms unchanged at 6-10 per cent. The company, on the consolidated basis, registered a gain of 3.71% in its net profit at Rs 2374 crore for the quarter as compared to Rs 2289 crore in the same quarter in the previous year.

The global cues remained mixed; the US markets continued their rally overnight, extending the upward trend seen in recent weeks, shrugging off the report of unexpected rise in jobless claims during the passing week. However, the Asian markets looked embroiled in the local issues and some of the indices in the region slipped from their week’s high on fresh evidence of weakness in the world's second largest economy China. Though, the firm start of the European markets supported the domestic market sentiments.

Back home, against the expectation of cautiousness due to the start of official earnings season followed by the announcement of IIP and CPI numbers later in the evening, the markets made a gap-up start and held the gains throughout the session, adding further to their last session’s rally. The IT pack was the major gainer of the day on the back of India's second largest software services exporter Infosys reporting a better than expected 3.7 percent year-on-year increase in its consolidated net profit for the first quarter and maintaining its forecast for 6-10 percent revenue growth for the current 2013-14 financial year. Though, there was some cautiousness too, related to RBI’s upcoming monetary policy review slated to be released on July 30, after the Reserve Bank of India (RBI) governor D Subbarao said that the central bank will assess growth, inflation and the external situation before taking a view. However, markets got a major boost in the last leg of trade with the report that India’s trade deficit narrowed in June to $12.24 billion from a 7-month high, helped by a slowdown in gold imports. The overall Exports fell 4.57% from a year earlier to $23.79 billion, their second straight monthly fall. Back on the street, the day was of the IT sector stocks which zoomed by 6 percent, followed by technology, capital goods and healthcare stocks. However, despite the rally mood, consumer durables, realty and PSU stocks remained in somber mood, ending the session in red.

The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 1083:1226, while 138 scrips remained unchanged. (Provisional)

The BSE Sensex gained 304.84 points or 1.55% to settle at 19980.90.The index touched a high and a low of 19985.55 and 19785.59 respectively. Among the 30-share Sensex pack, 22 stocks gained, while rest 8 declined. (Provisional)

The BSE Mid cap indices ended higher by 0.02%, while the Small cap indices ended lower by 0.18%. (Provisional)  On the BSE Sectoral front, IT up by 6.53%, Teck up by 5.22%, Capital Goods up by 2.05%, Health Care up by 1.23% and Oil & Gas up by 0.96% were the top gainers, while Consumer Durables down by 1.09%, Realty down by 0.46%, PSU down by 0.37%, FMCG down by 0.18% and Auto down by 0.12% were the top losers in the space. (Provisional)

The top gainers on the Sensex were Infosys up by 10.87%, Wipro up by 4.16%, TCS up by 2.93%,  RIL up by 2.77% and L&T up by 2.71%, while, Maruti Suzuki down by 2.97%, ONGC down by 2.63%, Hindalco Industries down by 1.12%, Mahindra & Mahindra down by 0.91% and ITC down by 0.84% were the top losers in the index. (Provisional)

Meanwhile, dashing rate cut hopes in the upcoming monetary policy review, the Reserve Bank of India (RBI) governor D Subbarao has said that the central bank will assess growth, inflation and the external situation before taking a view, while it will give priority to controlling inflation, which still remains high. The RBI governor presented an uncertain outlook for the domestic economy and expressed concerns over the deteriorating macro-economic indicators. Meanwhile, with the RBI and government’s collective efforts, the wholesale price index declined to 4.7 percent in May, however, retail inflation still remain at elevated levels of 9.31 percent.  

The sharp depreciation of the rupee has increased upside risks to WPI inflation and may prompt RBI to revise its inflation estimate upwards. The RBI governor has attributed the decline in rupee value to global factors and said that it is difficult to predict when global conditions affecting the rupee would ease. The Rupee has declined by about 9 percent in the past three months and had recently touched an all time low of 61.21 per dollar. Subbarao also cautioned that country’s current account deficit (CAD) is still high, the CAD has widened to a record high at 4.8 percent of GDP in the last fiscal.

The RBI next monetary policy meet will be held on July 30. In the last policy review in June, the central bank left interest rates unchanged on account of declining value of the rupee, fears of inflation and the high CAD.

India VIX, a gauge for markets short term expectation of volatility lost 1.05% at 18.69 from its previous close of 18.89 on Thursday. (Provisional)

The CNX Nifty gained 82.60 points or 1.39 % to settle at 6,017.70. The index touched high and low of 6,019.00 and 5,951.15 respectively. 31 stocks advanced against 19 declining on the index. (Provisional)

The top gainers on the Nifty were Infosys up by 10.92%, IDFC up by 3.68%, L&T up by 3.39%, TCS up by 2.90% and Reliance Industries was up by 2.87%. On the other hand, JP Associate down by 3.23%, Maruti Suzuki down by 3.22%, ONGC down by 2.66%, UltraTech Cement down by 1.83% and Grasim Industries down by 1.45% were the top losers. (Provisional)

Most of the European markets were trading in green with, France’s CAC 40 up by 0.41%, Germany’s DAX up by 0.88% and the United Kingdom’s FTSE 100 up by 0.53%.