Markets trade jubilantly in early deals; Sensex claims 21,000 level

Shrugging off weak global cues, Indian equity benchmarks are trading jubilantly in early deals on Thursday with frontline gauges comfortably trading over their crucial 21,000 (Sensex) and 6,200 (Nifty) bastions, gaining over a percentage point. Sentiments remained higher on report that foreign institutional investors (FIIs) bought shares worth a net Rs 644.80 crore on October 23, 2013. Buying in telecom stocks too supporting the sentiments with scrips like Bharti Airtel, Idea Cellular and Reliance Communication all edged higher after the Telecom Regulatory Authority stuck to its earlier stance on pricing of spectrum, which calls for up to 60 percent cut in the reserve price of spectrum in the upcoming third round of auction.

Global cues remained sluggish with the US markets ending lower overnight on profit booking following the upward trend shown over the past two weeks. Moreover, most of the Asian equity benchmarks were trading in the red at this point of time after Chinese money market rates surged, while worries over China’s economic outlook too weighed down sentiments. However, some recovery was seen in the regional counterparts after a preliminary survey showed activity in China's vast manufacturing sector expanded at its fastest pace in seven months in October.

Back home, all the sectoral indices on the BSE were trading in the green with Realty and Banking segments gaining the most. Oil and gas, auto, fast moving consumer goods, consumer durables and public sector undertakings too were trading with significant gains. The broader indices too were trading with traction, while the market breadth on the BSE was positive; there were 911 shares on the gaining side against 326 shares on the losing side while 47 shares remain unchanged.

The BSE Sensex opened at 20766.05; about 1 points lower compared to its previous closing of 20767.88, and has touched a high and a low of 21039.42 and 20750.98 respectively.

The index is currently trading at 21014.08, up by 246.20 points or 1.19%. There were 28 stocks advancing against 2 declines on the index.

The overall market breadth has made a strong start with 70.56% stocks advancing against 25.90% declines. The broader indices too were trading in green; the BSE Mid cap index up by 0.84% and Small cap index up 0.76%. 

The top gaining sectoral indices on the BSE were, Realty up by 2.02%, Bankex up by 1.43%, Oil & Gas up by 1.36%, Auto up by 1.23% and FMCG up by 1.22%, while there were no losers on the sectoral index.

The top gainers on the Sensex were Tata Motors up by 2.67%, Bharti Airtel up by 2.07%,  ONGC up by 1.88%, ITC up by 1.76% and HDFC Bank up by 1.48%. On the flip side, Wipro was down by 0.73% and Coal India was down by 0.22% were the few losers on the Sensex.

Meanwhile, Finance minister P Chidambaram, after reviewing the performance of public sector banks, has allowed the government to infuse the budgeted Rs 14,000 crore of bank capitalization through preferential allotment. However, the minister ruled out the possibility of the government diluting its shareholding in the state-run banks.

This development is complete contradiction to Reserve Bank of India’s suggestion of government diluting ownership in Public State Banks even below 51% as an option for raising funds and easing fiscal burden, with government maintaining of keeping its stake in state-run banks at 58%.

Further, the minister has left it on the bank’s board to decide upon the issue of raising capital from the markets through qualified institutional placement (QIP) or other routes, which would be in addition to the capital infusion by the government. This development comes on the heels of the country's biggest lender, State Bank of India mulling raising 8,000 crore through the QIP route. The bank, in which government holds 62.31% stake, is expected to take a call on this within a month.

The government infused Rs 12,517 crore into 13 PSBs in 2012-13. It had infused about Rs 20,117 crore in PSBs during 2010-11, and Rs 12,000 crore in 2011-12.

The CNX Nifty opened at 6,162.80; about 15 point lower as compared to its previous closing of 6,178.35, and has touched a high and a low of 6,252.45 and 6,162.60 respectively.

The index is currently trading at 6,241.25, up by 62.90 points or 1.02%. There were 42 stocks advancing against 8 declines on the index.

The top gainers of the Nifty were DLF up by 2.83%, Bank of Baroda up by 2.37%, JP Associate up by 2.26%, Kotak Bank up by 2.18% and Tata Motors up by 2.14%. On the flip side, Ambuja Cements down by 1.55% Power Grid down by 0.75%, HCL Tech down by 0.51%, Wipro down by 0.50% and ACC down by 0.49% were the top losers on the index.

Most of the Asian equity indices were trading in red; Shanghai Composite dipped 5.20 points or 0.24% to 2,177.90, Hang Seng declined 204.27 points or 0.89% to 22,795.68, Nikkei 225 shed 94.22 points or 0.65% to 14,331.83, Straits Times slipped 4.20 points or 0.13% to 3,200.60, Seoul Composite decreased 1.97 points or 0.10% to 2,033.78 and Taiwan Weighted was down by 9.43 points or 0.11% to 8,384.19.

On the flip side, Jakarta Composite rose 21.33 points or 0.47% to 4,567.83 and KLSE Composite was up by 5.71 points or 0.31% to 1,819.82.