Benchmarks continue to trade firm on upbeat GDP numbers

Benchmarks continued to remain steady in late morning trade. Better than expected GDP data and positive China PMI data were providing support to the indices after an upmove last week. Sentiments remained boosted on report that foreign investors, continuing their buying spree for the third straight month invested net Rs 8,000 crore in Indian stocks in November. On the global front, most of the Asian equity benchmarks were trading in green at this point of time, as investors were cautiously awaiting key US data this week. Though, some support came in from decent reading on China manufacturing. The nation’s factory activity maintained steady growth momentum in November, boosted by resilient new orders, though the pace of expansion eased slightly from October.

Back home, traders were buying, Healthcare, Bankex and Capital Goods while selling were seen in Oil & Gas, FMCG and PSU on the BSE. Sugar stocks like Balrampur Chini, Shree Renuka Sugar, Rana sugar edged higher as the price deadlock was resolved and millers in Uttar Pradesh agreed to pay Rs 280 per quintal of sugarcane, they will pay Rs 260 per quintal in 15 days and another Rs 20 by the end of the crushing season.

The market breadth on BSE remains positive with advances to declines in the ratio of 1197:499. BSE Sensex and NSE Nifty were comfortably trading near their psychological 20,800 and 6,200 levels respectively. The BSE Sensex is currently trading at 20882.93, up by 91.00 points or 0.44% after trading in a range of 20893.99 and 20770.51. There were 21 stocks advancing against 9 declines on the index. The broader indices were trading green; the BSE Mid cap index was up by 1.00% and Small cap index gained 0.96%.

The top gaining sectoral indices on the BSE were, Healthcare up by 1.51%, Bankex up by 1.28%, Capital Goods up by 1.22%, Realty up by 0.90%, and Power up by 0.60%, while Oil & Gas down by 0.28%, FMCG down by 0.18% and PSU down by 0.03% and were the only losers on the sectoral index.

The top gainers on the Sensex were Jindal Steel up by 2.99%, ICICI Bank up by 2.63%, BHEL up by 2.40%, Sun Pharma up by 1.92%, and L&T up by 1.51%. On the flip side, ONGC was down by 2.93%, Hindustan Unilever was down by 1.24%,  Gail India was down by 1.20%, Hindalco Inds was down by 1.02% and Maruti Suzuki was down by 0.50% were the top losers on the Sensex.

Meanwhile, in its highest reading since April, the HSBC Purchasing Managers’ Index (PMI), a headline index designed to measure the overall health of the manufacturing sector, snapping its three consecutive months’ declining streak climbed from 49.6 in the previous month to 51.3 in November, mainly led by the rise in new domestic orders. Indicating a slight improvement in operating conditions, this was the first reading above 50.0 recorded since July.

Strengthened demand resulted in new order growth and although modest, the rise in new work intakes that ended five month period of contraction, mainly helped boost the PMI. Export business which increased at a marginal and slower rate, suggested that the domestic market was the main source of new order gains. Meanwhile, the new orders sub-index rose to 51.9 last month; it’s highest since April and against 48.9 in October.

Sector wise data indicated that consumer goods continued to outperform the other two categories monitored by the survey, with both output and new orders rising at solid rates in the latest month. This was closely followed by intermediate goods.

Further, the employment activity increased for the second consecutive month, though the pace of job creation remained marginal and weaker than its long run average. Additionally, inflationary pressures in the Indian manufacturing economy too softened in November, while purchase prices increased at the weakest pace since August, Input costs rose at weaker rates across all three monitored sub-sectors.

The latest data is quite encouraging as this points some good news on inflation as well, suggesting that Reserve Bank of India (RBI) is getting closer to the end of its tightening cycle, which so far has hiked interest rates by 25 basis points each at its back-to-back meetings to curb rising prices, taking the policy repo rate to 7.75%. However, the survey also added that RBI may still need to notch rates a bit up further.

The CNX Nifty is currently trading at 6,208.80 up by 32.70 points or 0.53% after trading in a range of 6,211.95 and 6,171.15. There were 38 stocks advancing against 12 stock declines on the index.

The top gainers of the Nifty were Ranbaxy up by 5.27%, Jindal Steel up by 2.69%, ICICI Bank up by 2.54%, Axis Bank up by 2.22%, and IDFC up by 2.12%, On the flip side, ONGC down by 3.11%, Power Grid down by 2.00%, Hindustan Unilever down by 1.47%,Gail down by 1.20%, and Hindalco down by 1.02% were the top losers on the index.

Most of  Asian equity indices were trading in green; Shanghai Composite declined 36.62 points or 1.65% to 2,183.88, Nikkei 225 shed 59.61 points or 0.38% to 15,602.26, and Seoul Composite contracted 14.68 points or 0.74% to 2,029.73. On the flip side, Straits Times was up by 2.63 points or 0.09% to 3,178.72, Hang Seng rose 26.61 points or 0.11% to 23,907.90, Jakarta Composite surged 52.64 points or 1.24% to 4,309.08, KLSE Composite added 2.12 points or 0.12% to 1,814.84, and Taiwan Weighted was up by 2.99 points or 0.04% to 8,408.33.