Sensex hits 6-month high to end at 18K, Tata Motors up 5%
12 September 2012
The 30-share BSE Sensex surpassed the 18000 level quite smartly in late trade on Wednesday, for the first time since February 23, 2012. Favourable German's Constitutional Court ruling has lifted the mood of not only global markets but also commodities.
The Sensex rose 147.08 points to close at 18,000.03, aided by the upmove in Tata pack, metals, FMCG, oil & gas and banks stocks. Meanwhile, the Nifty climbed 41 points to 5,431.
European markets gained strength, immediately after the Germany's Constitutional Court said the country can ratify the euro zone's new rescue fund and budget pact as long it can guarantee there will be no increase in German financial exposure to the bailout fund without parliament's approval.
Ruling that an injunction against the European Stability Mechanism (ESM) and fiscal compact was largely unfounded, the court said one condition for allowing ratification was that any increase in German liability beyond 190 billion euros (USD 244.77 billion) must first be approved by the Bundestag lower house of parliament.
France's CAC rose 0.7% and Germany's DAX was up 1% while Britain's FTSE gained 0.3%. Currencies against the US dollar also appreciated. Euro rose 0.57% to 1.2928 a dollar while Indian rupee went up by 17 paise to 55.17 against the US dollar.
Commodities too gained momentum; Gold jumped 0.7% to USD 1744.55 an ounce and copper was up by 0.5%. Brent crude moved up 0.8% and NYMEX crude gained 0.7%.
Now all eyes are on other important events; Dutch polls and the second is Federal Reserve's policy meeting that will begin today for two days. Market experts expect economic stimulus after the disappointing jobs report last week.
Benoit Anne, MD, head-EM strategy, Societe Generale says the markets are desperate for action and overall, there is a very strong possibility of the Fed implementing the third round of quantitative easing.
Back home, the industrial output for July, which was the non-event for the market, grew by 0.1% as against expectations of 0.5% as all sectors disappointed. Capital goods contracted by 5% while consumer goods remained flat.
Inflation for August, which will be announced on Friday, will closely be watched by investors ahead of RBI policy meet on September 17. Experts feel the upcoming Reserve Bank of India policy meeting is expected to be a non-event for the market. Agam Gupta, Standard Chartered Bank doesn't expect the central bank to cut rates.
Country's largest commercial vehicle maker Tata Motors topped the buying list with 5.3% gains after the German ruling. Software services exporters TCS and Wipro were up 1.5% and 2.5%, respectively.
Metals stocks too rallied; Jindal Steel shot up 3.8% while Tata Steel gained 2.7%. Sterlite Industries rose 1.4%. Coal India, India's largest coal mining company jumped 3%.
Private sector lender HDFC Bank moved up 1% while its rival ICICI Bank was up 0.4%.
Index heavyweight Reliance Industries and cigarette major ITC were up 0.9% each. Engineering conglomerate Larsen & Toubro spiked nearly 3%.
Drug producer Cipla tanked 2.7% and state-run power producer NTPC plummeted 2%.
Power equipment manufacturer BHEL lost 1.6% on concerns over order book. Two-wheeler majors Hero Motocorp and Bajaj Auto were down 1%.
Airline stocks gained momentum after India's aviation minister Ajit Singh says he's hopeful the government will allow foreign direct investment into the sector and has talked to most of the ruling coalition's political allies. Kingfisher, SpiceJet and Jet Airways were up 5-8%.
In the second line shares, Mahindra Satyam, Rolta, Polaris and Tech Mahindra rallied 3.7-4.6%.
Gujarat State Petronet surged nearly 4% after the Petroleum and Natural Gas Regulatory Board cut company's gas grid tariff by 12.5%, which was quite less compared to analysts' expectations.
Deccan Chronicle was locked at 10% lower circuit as sources say there was no formal request from lenders to refer the company to corporate debt restructuring cell.
Sugar stocks Shree Renuka and Bajaj Hindusthan were down 2.5% while Balrampur Chini fell 1.6%.
Advancers outnumbered decliners by 835 to 600 on the National Stock Exchange.
The Sensex rose for a sixth consecutive session to close at its highest since February 23 on rising hopes for government reforms after the aviation minister signalled the country was moving to allow foreign direct investment into the sector.
Gains in local shares on Wednesday also tracked a risk-on mood globally, after Germany's top court backed the legality of the euro zone bailout funds, although with conditions.
SpiceJet Ltd provisionally gained 7.12 percent, Kingfisher Airlines advanced 8 percent, while Jet Airways rose 5 percent.
The Sensex provisionally rose 0.89 percent to end just above the psychologically key 18,000 points.
The Nifty rose rose 0.76 percent.
The BSE Sensex was touched the 18000 level - a six-month high - supported by Tata pack, FMCG, metals and technology stocks. Engineering conglomerate Larsen & Toubro and index heavyweight Reliance Industries rose over 2% and 1%, respectively.
The BSE benchmark gained 152.24 pionts at 18,005.19 and the NSE benchmark went up 41.6 points to 5,431.6.
Airline shares extend gains after India's aviation minister says he's hopeful the government will allow foreign direct investment into the sector and has talked to most of the ruling coalition's political allies.
SpiceJet rose 7.8%, Kingfisher Airlines advanced 8%, while Jet Airways rallied 5%.
Potential airline measures help cement expectations for further government reforms, while Germany's top court's backing of the euro zone bailout fund also helps.
Tata Motors rallied 5.6%, helped as well by hopes for increased sales for the new Range Rover model to be introduced in October.
Software services exporter TCS and FMCG major Hindustan Unilever were up 1.5% each.
Metals stocks too gained further on German court ruling. Jindal Steel shot up nearly 4%. Tata Steel was up 2.5% and Sterlite rose 1.3%.
Coal India, country's largest coal mining company surged nearly 3%. Private sector lender HDFC Bank and IT services exporter Infosys were up over 0.5%.
Indian shares gained strength following upmove in European markets after the German's Constitutional Court ruling . The court has rejected complaints against European Stability Mechanism (ESM) as 'largely unfounded'.
The 30-share BSE Sensex rose 100.27 points to 17,953.22 and the 50-share NSE Nifty went up 27 points to 5,417.05.
German court has allowed ratification of ESM under certain conditions and rejected complaint against ECB bond buys. The court said the country must ensure German liability does not exceed 190 billion euros.
Euro too gained 0.3% to 1.29 against the US dollar while Dollar index declined 0.14% to 79.79. France's CAC and Germany's DAX were up 0.5-0.8% while Britain's FTSE moved up just 0.3%. IBEX (Spain) jumped above 1.2%. Bond yields reacted too; Spain and Italy's 10-year bond yields fell more than 0.5%.
Back home, country's largest commercial vehicle maker Tata Motors extended gains to 3.65%. The Bank Nifty gained 0.5% as private sector lender HDFC Bank rose 0.6% while its rival ICICI Bank was up 0.2%.
Top software services exporter TCS jumped 1.5% and Wipro rallied nearly 2%. Engineering conglomerate Larsen & Toubro and drug producer Dr Reddy's Labs were up 1.6% each.
FMCG majors ITC and Hindustan Unilever climbed 0.8% and 1.4%, respectively. Shares of Tata Steel and Coal India rallied 2%.
Index heavyweights Reliance Industries, Infosys and HDFC were marginally higher.
Shares of Cipla, BHEL, NTPC, Jindal Steel and Hindalco Industries were down 1-2%.
`Indian equity benchmarks continued to trade with marginal gains due to upmove in Tata pack, FMCG, technology, healthcare and private banking stocks. But the weakness in BHEL, Bharti, Cipla and ONGC has limited the upside. Even heavyweights Reliance Industries and State Bank of India turned flat.
The 30-share BSE Sensex went up 44 points to 17,897 and the 50-share NSE Nifty advanced 8 points to 5,398.
European markets were flat in early trade, especially ahead of German's Constitutional Court ruling that will determine the fate of EU's 500 billion euro bailout fund (ESM) and Dutch polls. Federal Reserve's policy meeting, which will begin today for two days, will also be closely watched by investors as the expectations have been mounted over economic stimulus after the disappointing employment data.
Back home, state-run power equipment maker BHEL lost over 2% on concerns over order books after the coal allocation scam. JSPL too tanked 2.8% ahead of decision by inter ministerial group over de-allocation of coal blocks.
County's largest private sector lender ICICI Bank fell 0.4% while its rival State Bank of India declined 0.2%. Housing finance company HDFC was down 0.3%.
Shares of Cipla, NTPC, Hindalco and Hero Motocorp were down 1-1.8%. Telecom operator Bharti Airtel and utility vehicle maker M&M plummeted 0.6% each.
Tata Motors remained top gainer with 3% gains. Shares of TCS, L&T, HUL, Coal India, Wipro and Dr Reddy's Labs gained 1-2%.
Indian equity benchmarks erased somewhat gains after a flat growth in industrial output for July, which came in to 0.1% as compared to minus 1.8% in previous month. Major sectors like manufacturing, mining and capital goods have shown degrowth in July as compared to a year ago period. The growth in consumer durables, electricity and basic goods has fallen during the same period.
The BSE benchmark gained 72 points at 17,926, which was inching towards the 18000 level before the announcement of IIP data. Meanwhile, the NSE benchmark remained above the 5400 level, rising 19 points to 5,405.
Not only India market but also its global markets remained firm ahead of major events. There are events like German's Constitutional Court ruling at 13:30 hours IST,
Dutch polls following the April collapse of Mark Rutte's Liberal-led government and Federal Reserve's policy meeting that will start today for two days.
Geoffrey Dennis, managing director and Global EM Strategist, Citi is hopeful of FOMC cheering the markets with another round of QE this week since the recently announced US employment data was subdued.
Back home, commercial vehicle maker Tata Motors extended gains to 3%. Country's largest coal mining company Coal India was up 2%.
Software services exporters TCS and Wipro gained 1.7% each. Private sector lender ICICI Bank rose 1% while its rivals HDFC Bank and SBI moved up 0.5% each.
Shares of Hindustan Unilever, Larsen & Toubro, Infosys, Tata Steel and Dr Reddy's Labs were up 0.5-1%.
Jindal Steel dropped for the third consecutive session, falling 2.7% on concerns over de-allocation of coal blocks. Drug producer Cipla tanked 1.7%.
Telecom operator Bharti Airtel and power producer NTPC were down 0.7% each.
Indian shares gained more strength, helped by banking, technology, fast moving consumer goods, metals and auto stocks. Asian markets too gained further ahead of key events like German's Constitutional Court ruling on ESM around 13:30 hours IST, Dutch polls and Federal Reserve's policy meeting that will begin today for two days.
Nikkei and Taiwan Weighted were up more than 1% while Kospi surged 1.6%. Hang Seng moved up 0.8% while Shanghai was flat.
The 30-share BSE Sensex rose 82 points to 17,934.74 and the 50-share NSE Nifty climbed 23 points to 5,412.90.
Get the best expert advice for queries on investments in equity, debt, gold, mutual funds, real estate
Industrial output data for July will be announced today.
The broader markets outperformed benchmarks as three shares advanced for every share declining on the National Stock Exchange. The BSE Midcap Index moved up 0.8% and Smallcap jumped nearly 1%.
Country's largest commercial vehicle maker Tata Motors topped the buying list with 2.6% gains. Private sector lender ICICI Bank was up over 1% while its rivals State Bank of India and HDFC Bank were up 0.5-0.7%,
Engineering conglomerate Larsen & Toubro, FMCG major Hindustan Unilever, world's sixth largest steel producer Tata Steel and London Stock Exchange-listed Vedanta Resources' subsidiary Sterlite Industries advanced 1% each.
Technology majors Infosys, TCS and Wipro too gained 0.4-0.7%.
Housing finance company HDFC, telecom operator Bharti Airtel, two-wheeler maker Hero Motocorp, power equipment manufacturer BHEL and drug producer Cipla were down 0.3-0.7%. Jindal Steel fell 3% for third consecutive session.
The 50-share NSE Nifty reclaimed the 5,400 in early trade following a positive trend across the globe. There are major events like German's Constitutional Court ruling that will decide the fate of ESM around 13:30 hours IST, Dutch polls and the Federal Reserve's policy meeting.
The BSE Sensex moved up 58 points to 17,910.79 and the NSE Nifty rose 15 points to 5,405.05. Among Asian peers, Hang Seng and Taiwan Weighted climbed 0.9% while Nikkei and Kospi were up 1-1.5%, but Shanghai was down 0.4%.
Get the best expert advice for queries on investments in equity, debt, gold, mutual funds, real estate
Back home, Tata Steel, Tata Motors, SBI, ICICI Bank, Axis Bank, Kotak Mahindra Bank, JP Associates, Dr Reddy's Labs, Reliance Industries, HUL, NTPC, L&T and Wipro led the market higher.
Drug producer Sun Pharma has touched fresh 52-week high of Rs 696, up 1%.
Siemens fell 3% as the parent company Siemens AG was expected to sell 39.59 lakh shares via block deal.
The CNX Midcap Index moved up 32 points to 7,310. About three shares advanced for every share declining on the National Stock Exchange.
In the second line shares, Gujarat State Petronet jumped 6%. Petroleum and Natural Gas Regulatory Board (PNGRB) has cut company's gas grid tariff by 12.5%, which was not higher as earlier expected.
Panacea Biotec gained another 6.5%. IFCI rose 3%. The Financial Express reported that the company is planning to redeem Rs 400 crore bonds to prevent government from converting the debentures into equity.
Rolta, HCC, Sintex Industries, Apollo Tyres and Jain Irrigation were up 1-2%. FACT surged 4%.
Civil aviation minister Ajit Singh yesterday said that the government is keen on allowing FDI in civil aviation. He expects cabinet to take up aviation FDI proposal soon. Kingfisher was up 3%. Jet Airways rose 1.5% and Spice Jet spiked 3.5%.
Deccan Chronicle tanked 4% as The Times of India reported that the company pledged its four trademarks (Deccan Chronicle, The Asian Age, Andhra Bhoomi and Financial Chronicle) to IDBI for Rs 250 crore loan. Yesterday the board members of the company has passed resolution to restructure debt via CDR route.