Benchmarks soar to day’s high on sustained buying activities; Sensex trades past 20,600

Trading strength to strength, benchmark equity indices have now soared to day’s high level on sustained buying activities in index heavyweights, viz Reliance Industries, ITC, Infosys, HDFC, ICICI Bank among others. The rally at Dalal Street is just not confined to larger peers, as broader indices are equally participating in it and are now trading with gains over half a percent. Meanwhile, at day’s high point, both Sensex and Nifty are comfortably cruising past the crucial 20,600 and 6,100 levels respectively.

On the global front, in the Asian-pacific region, Japanese shares surged and the yen sagged on Tuesday after the Bank of Japan (BoJ) doubled loan programs aimed at stimulating bank lending and economic growth, while most other Asian shares were softer after solid gains in recent sessions.

Closer home, while none of the sectoral indices are trading in red, stocks from banking, Metal and Capital goods counters were outperforming. Banking shares gained after the finance minister announced a fiscal deficit target of 4.1 percent of the GDP, its lowest since 2007/08, and a gross market borrowing of 5.97 trillion rupees, below market expectations. The overall market breadth on BSE is in the favour of advances, which were outnumbering declines in the ratio of 1304:482; while 43 shares remained unchanged.

The BSE Sensex is currently trading at 20648.63, up by 184.57 points or 0.90% after trading in a range of 20658.13 and 20436.48. There were 23 stocks advancing against 7 declines on the index.

The broader indices too added some ground; the BSE Mid cap index was up by 0.70% and Small cap index gained 0.52%.

The top gaining sectoral indices on the BSE were, Bankex up by 2.38%, Metal up by 1.18%, Capital Goods up by 1.12%, Power up by 0.93% and Auto up by 0.54%, while there were no losers on BSE sectoral front.

The top gainers on the Sensex were Axis Bank up by 3.30%, HDFC up by 3.00%, ICICI Bank up by 2.92% SBI up by 2.06% and HDFC Bank up by 1.84. On the flip side, Bharti Airtel down by 0.98%, Coal India down by 0.60%, Gail India down by 0.58%, Dr Reddy’s Lab down by 0.44% and Tata Power down by 0.39% were the top losers on the Sensex.

Meanwhile, marking tenth consecutive month of decline, Indian exports of gold jewellery dropped in January, with outbound shipments declining by 23 per cent to Rs 2,993 crore. Cumulatively, gold jewellery exports from April to January fell 44.42 per cent to Rs 33,178 crore from Rs 59,693 crore in the corresponding period of the previous fiscal. However, in the first two months of the current fiscal, gold imports had crossed 300 tonne. Nevertheless, exports are expected to further fall due to no sign of any government incentives to revive the sagging shipments.

India has imposed a lot of restriction to bring down the imports of the yellow metal, which is the second biggest import item by value after oil. These measures include a rule that 20 percent of all gold shipped to be re-exported as jewellery, which makes it difficult for domestic jewellers and even exporters to get supplies despite high premiums. Besides the 80/20 import rule, the government has raised the customs duty thrice to 10 per cent in 2013.

However, in a development which has raised the hopes of improvement in imports of gold, finance ministry has said that India will review the curbs by the end of March, which coincides with the end of India's fiscal year.

The CNX Nifty is currently trading at 6,130.95, up by 57.65 points or 0.95% after trading in a range of 6,134.20 and 6,066.80. There were 39 stocks advancing against 11 decliners on the index.

The top gainers of the Nifty were Jindal Steel up by 5.86%, Axis bank up by 3.42%, HDFC up by 3.14%, ICICI bank up by 3.14% and PNB up by 2.73%. On the flip side, BPCL down by 0.87%, Gail India and Bharti Airtel down by 0.77%, HCL Technologies down by 0.67% and Coal India down by 0.59% were the top losers on the index.

The Asian equity indices were trading mixed; Hang Seng up by 0.08%, Jakarta Composite strengthened by 0.18%, Nikkei 225 surged 3.13%, KOSPI Composite added 0.03% and Taiwan Weighted added 0.43%.

On the flip side, Shanghai Composite declined 1.00%, KLSE Composite contracted 0.21% and Straits Times slid 0.04%.