Markets end at all time closing high level; Sensex surpasses 21,500 mark

Boisterous benchmarks once again showcased an enthusiastic performance on Thursday, by rallying over a percentage point. Sentiments remained up-beat since start as key bourses opened with decent gains and there appeared not even an iota of profit booking in the session as the benchmarks managed to fervently gain from strength to strength, as investors continued their hunt for fundamentally strong stocks. Frontline indices not only extended their rally for third straight day but also recorded their all time closing high, settling comfortably above their crucial 6,400 (Nifty) and 21,500 (Sensex) bastions as investors took to hefty across the board buying.

Sentiments got bolstered on report that India’s current account deficit (CAD) came sharply lower at a four-year low to $4.2 billion or 0.9% of GDP in December quarter of 2013-14. The lower CAD was primarily on account of a decline in the trade deficit as merchandise exports picked up and imports moderated, particularly gold imports. Sentiments also remained up-beat after planning commission Deputy Chairman Montek Singh Ahluwalia said that the new government will need to revive investments and push infrastructure projects within the three months of being elected to bring economic growth back on track.

Global cues too remained supportive with European markets trading higher in early deals ahead of the European Central Bank’s interest-rate decision. All the Asian markets too ended the session in green led by the Japanese market after an advisory committee said the world’s largest pension fund doesn’t need a domestic-bond focus. Weakness in Yen too aided the sentiments.

Back home, there was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too participated strongly in the rally. Appreciation in Indian rupee too supported the sentiments. The partially convertible rupee was trading at 61.42 per dollar at the time of equity market closing against the Friday’s close of 61.75 on the Interbank Foreign Exchange on the back of dollar sale by exporters and banks. The markets sentiment was also boosted by data showing that foreign funds remained net buyers of Indian stocks on March 5, 2014. Foreign institutional investors (FIIs) bought shares worth a net Rs 737.29 crore on Wednesday, as per provisional data from the stock exchanges.

Meanwhile, Cement stocks remained on buyers’ radar on expectation of higher demand in coming months as March to mid-June period is among the peak periods for cement demand before the monsoon season kicks in. Banking stocks too performed well despite Finance Minister P. Chidambaram after a performance review meeting with public sector banks and financial institutions said that Public sector banks could report higher non-performing assets in the current financial year ending March, which increased due to the stress in large corporate accounts, the small-scale industry, and small and medium enterprises. Additionally, shares of public sector oil marketing companies (OMCs) edged higher as crude oil prices eased and the Indian rupee strengthened against the dollar.

The NSE’s 50-share broadly followed index Nifty rose by over seventy points and ended above the psychological 6,400 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex surged by over two hundred and thirty points to finish above the psychological 21,500 mark. Broader markets too were traded with traction throughout the trade and ended the session with a gain of over a percentage point. The market breadth remained in favor of advances, as there were 1,701 shares on the gaining side against 1,033 shares on the losing side while 149 shares remain unchanged.

Finally, the BSE Sensex surged by 237.01 points or 1.11%, to settle at 21513.87, while the CNX Nifty gained 72.50 points or 1.15% to settle at 6,401.15.

The BSE Sensex touched a high and a low of 21525.14 and 21329.88, respectively. The BSE Mid cap index was up by 1.21%, while the Small cap index gained 1.22%.

The top gainers on the Sensex were Hindalco Inds up by 4.33%, BHEL up by 3.78%, ICICI Bank up by 3.33%, ONGC up by 2.91% and Tata Steel up by 2.38%, while Cipla down by 1.38% Wipro down by 0.86%, Tata Motors down by 0.45%, TCS down by 0.40% and Hindustan Unilever down by 0.29% were the top losers in the index.

On the BSE Sectoral front, Realty up by 4.09%, Power up by 2.45%, Oil & Gas up by 2.23%, Metal up by 2.23% and PSU up by 2.11% were the top gainers, while Healthcare down by 0.27% was the only loser in the space.

Meanwhile, according to the industry body Assocham, India's trade with Commonwealth of Independent States (CIS) nations is likely to decline by 15 percent if the prevailing political turmoil between Ukraine and Russia escalates and stretches over a longer period of time. At present Ukraine is India's second largest trading partner in the region after Russia and is also the gateway for country's exports to a number of other CIS countries.

Assocham study found that trade between India and the CIS countries declined by over eight percent during April-January' FY14 in the current fiscal adding that India's bilateral trade with Ukraine during the reported period will be around $2 billion facing a shortfall of about 36 percent as compared to the last fiscal year. On sector front, industry body stated that pharmaceuticals and electrical machinery industry could get hit the most on account of the current turmoil as these are the top exporters to the CIS region.

Ongoing political turmoil between Ukraine and Russia would also prove a setback to the recent efforts being taken by Commerce Ministry to promote exports to former members of the erstwhile Soviet Union. Ministry had decided to organize 14 India shows in the next 14 months in the key countries of CIS to enhance exports. During April-January'FY14, value of exports increased by 5.71% to $257.09 billion from a year earlier. Prevailing turmoil is also likely to impact India's imports as Ukraine is an important supplier of edible oil, petroleum products and fertiliser to India.

The CNX Nifty touched a high and low of 6,406.60 and 6,339.70 respectively.

The top gainers of the Nifty were Jaiprakash Associates up by 8.49%, DLF up by 5.08%, Hindalco Industries up by 4.32%, BPCL up by 4.27% and BHEL up by 3.92%. On the other hand, Cipla down by 1.31%, Wipro down by 1.00%, Tata Motors down by 0.72%, Lupin down by 0.72% and TCS down 0.53% were the top losers.

The European markets were trading in green, France's CAC 40 was up by 0.51%, Germany's DAX was up by 0.26% and United Kingdom's FTSE 100 was up by 0.14%.

The Asian markets concluded Thursday’s trade in green with Japan’s Nikkei share average jumping to a five-week high as investors took heart from news about the world’s largest pension fund’s allocation plan, and as a weaker yen boosted shares of exporters. Indonesia’s rupiah advanced to a 16-week high after overseas investors pumped money into the nation’s assets on improving economic fundamentals. Indonesia’s 10-year bonds rose for a seventh day after inflation slowed and the cost to insure the nation’s debt against default dropped to the least since June. In Hong Kong, the Land Registry has received 3,159 sale and purchase agreements for residential units in February, down 29.6% month-on-month and down 49.9% year-on-year. It received 3,987 sale and purchase agreements for all building units in the month, down 31.5% month-on-month and down 58.7% year-on-year.