Benchmarks make gap-up opening; Nifty recaptures 6,050 mark

Snapping three days of continues fall, Indian equity benchmarks have made a gap-up opening and are trading with a gain of around one and a half percent, recapturing their crucial 20,500 (Sensex) and 6,050 (Nifty) levels. Sentiments remained jubilant on E&Y’s report that India has emerged as the most attractive investment destination surpassing neighbouring China and the US, due to relaxation in FDI norms to boost investor sentiments. Some support also came in from rally in pharma and realty sector, as the Cabinet is expected to take a decision on relaxing FDI norms for the housing sector and reducing foreign direct investment cap to 49 percent in critical areas of the pharma segment.

Global cues too remained euphoric with the US markets making a positive closing of the passing week with S&P 500 reaching new record closing high above 1,800 on upbeat economic reports. Moreover, all the Asian equity markets were trading higher at this point of time with investors rejoicing the news that Iran reached an agreement with the Western powers after five days of talks in Geneva and agreed to limit its nuclear program.

Back home, shares of oil and gas companies including oil marketing companies are trading higher by up to 4% on the bourses as global oil prices have declined following the deal with Iran. Meanwhile, all the sectoral indices on the BSE were trading in the green with Banking and Capital Goods segments gaining the most. Fast moving consumer goods, realty, oil and gas, auto and public sector undertaking 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 918 shares on the gaining side against 270 shares on the losing side while 44 shares remain unchanged.

The BSE Sensex opened at 20326.66; about 109 points higher compared to its previous closing of 20217.39, and has touched a high and a low of 20533.28 and 20326.66 respectively.

The index is currently trading at 20510.47, up by 293.08 points or 1.45%. All the 30 stocks were trading in green on the index.

The overall market breadth has made a strong start with 73.65% stocks advancing against 21.89% declines. The broader indices too were trading in green; the BSE Mid cap index up by 0.87% and Small cap index up 0.86%. 

The top gaining sectoral indices on the BSE were, Bankex up by 2.21%, Capital Goods up by 1.80%, FMCG up by 1.70%, Realty up by 1.47% and Oil & Gas up by 1.31%, while there were no losers on the sectoral index.

The top gainers on the Sensex were ICICI Bank up by 3.10%, L&T up by 2.39%, ITC up by 2.29%, HDFC Bank up by 2.04% and Hero MotoCorp up by 1.87%, while there were the no losers on the Sensex.

Meanwhile, allaying fears of investors in overseas countries, especially the Indian diaspora, concerned over the deteriorating fundamentals of the domestic country, Finance Minister P Chidambaram assured them saying that India is a safe investment destination for them. By adding further, Chidambaram has said that present exchange rate of rupee is a better reflection of its true value and the country is confident that both volatility and speculation have been largely contained.

Finance Minister assured investors that stability in rupee value will come soon as Indian authorities such as RBI have been continuously taking measures in order to check rupee volatility. On inflation front, Chidambaram said that the rate of price rise will ease to below 5 percent in current fiscal following steps taken by the Government and the Reserve Bank of India.

Foreign investment is considered crucial for economic development, as a rise in capital inflow will help support the rupee, which has depreciated over 15 percent against dollar in 2013. Despite the various efforts of Indian authorities to enhance capital inflow, FIIs have pulled out Rs 2,916 crore from debt securities so far this month and have withdrawn Rs 53,070 crore from the debt market since the beginning of year owing to the rising worries over the US Fed tapering.

The CNX Nifty opened at 6,035.95; about 40 point higher as compared to its previous closing of 5995.45, and has touched a high and a low of 6,091.35 and 6,035.95 respectively.

The index is currently trading at 6,085.00, up by 89.55 points or 1.49%. All the 50 stocks were trading in green on the index.

The top gainers of the Nifty were ICICI Bank up by 3.19%, JP Associate up by 2.80%, L&T up by 2.41%, BPCL up by 2.39% and Kotak Bank up by 2.38%, while there were the no losers on the index.

The Asian equity indices were trading in green; Shanghai Composite was up by 7.31 points or 0.33% to 2,203.68, Hang Seng added 41.77 points or 0.18% to 23,738.05, Jakarta Composite was up by 15.83 points or 0.37% to 4,333.79, KLSE Composite added 11.02 points or 0.61% to 1,805.54, Nikkei 225 gained 201.45 points or 1.31% to 15,583.17, Straits Times was up by 6 8.04 points or 0.25% to 3,180.89, Seoul Composite gained 18.57 points or 0.93% to 2,024.80 and Taiwan Weighted gained 88.93 points or 1.10% to 8,205.71.