Nifty ends at 8395, Sensex up 380 points; banks up, M&M drags

03:30 pm Market close: After a stellar rally, the market ended on a high note. The Sensex was up 380.36 points or 1.4 percent at 27887.90 and the Nifty closed up 111.45 points or 1.4 percent at 8395.45.

About 1784 shares advanced, 1160 shares declined, and 709 shares were unchanged.

HDFC, BHEL, Tata Motors, ICICI Bank and Axis Bank were up 2-4 percent. M&M, Reliance, Bajaj Auto, Hero MotoCorp and HUL were laggards.

03:15 pm Macro economic outlook: Samiran Chakraborty, head of research, Standard Chartered Bank says at the moment there is some disconnect between PMI and IIP data. He estimates November IIP to be closer to 4 percent and if that happens the divergence will narrow.

He adds that right now just a positive IIP even at 2 percent will make everyone happy, but that should not be the case. October IIP slipped to -4.2 percent. India should aspire for higher IIP, he says. However, on the brighter side, he believes low IIPs are a thing of the past. Going ahead, he expects export growth numbers to be better in the second half of FY15.

On third quarter GDP, he says due to the much higher weightage on agriculture in Q3 when compared to the rest of the quarters, it will be closer to 5.5 percent. "Kharif production this time was not good, and to what extent it will be counterbalanced by manufacturing will have to be seen," he explains. Also, Chakraborty feels services will be tepid.

3:00 pm FDI policy on March 31: The Commerce and Industry Ministry plans to release the next edition of its consolidated FDI policy document on March 31, incorporating all the changes made over the past year.

"The next edition of the Consolidated FDI Policy Circular i.e. 'Consolidated Foreign Direct Investment Policy Circular of 2015' is scheduled to be issued on March 31, 2015, and will be effective from 1 April 2015," the Department of Industrial Policy and Promotion (DIPP) said.

The DIPP has invited public comments on the document till January 16, it said. FDI is considered crucial for economic development and India has taken several steps to attract such funds.

2:35 pm Market outlook: Veteran fund manager Akash Prakash of Amansa Capital sees Indian corporate earnings growing by over 20 percent compounded over the next 2-3 years. He believes the stock market will deliver similar growth. He bases the expectation on low base, acceleration of the economy and the rupee trading at 63-65 per dollar, coupled with low commodity prices.

"I am making an assumption that multiples will hold because interest rates are coming down, they may not expand. Bulls ofcourse will argue that multiples will expand. I would say do not assume that, assume multiples hold, earnings growth over the next 2-3 years will be 15-20 percent, so the markets should compound at that," he told CNBC-TV18. He is bullish on banks and consumer discretionary stocks. He continues to like IT despite the fact that he sees short-term pain in the sector.

Heavy buying continues on Dalal Street. The Sensex is up 354.98 points or 1 percent at 27862.52, and the Nifty up 103.70 points or 1 percent at 8387.70. About 1783 shares have advanced, 1088 shares declined, and 725 shares are unchanged.

HDFC, Tata Motors, Axis Bank, BHEL and ICICI Bank are top gainers in the Sensex. M&M, Hero Moto, Bajaj Auto and HUL are losers.

Gold prices fell further by Rs 75 to Rs 27,025 per ten gram at bullion market today on subdued demand even as the metal strengthened overseas. Silver, however, found fresh buying support from industrial units and coin manufacturers and rebounded by Rs 400 to Rs 36,600 per kg. Marketmen said sluggish demand from jewellers and retailers mainly kept pressure on gold prices. The metal had lost Rs 100 per ten gram yesterday.

1:50 pm Order win: Shares of BHEL rose 3 percent intraday after it bagged a Rs 3810 crore contract from Telangana for setting up the newly formed state's first thermal power project.

"Valued at Rs 3,810 crore, the order is for setting up the 800 MW supercritical thermal power plant on EPC (engineering, procurement & construction) basis at Kothagudem in Khammam District of Telangana," BHEL said in a statement.

The order has been placed on the company by the Telangana State Power Generation Corporation Limited (TSGENCO). The project is to be commissioned in 36 months on fast-track basis with both BHEL and TSGENCO setting up teams to expedite clearances and execution of the project.

1:30 pm Buzzing: Shares of Cyient jumped 3 percent intraday as it has acquired acquire 74 percent equity stake in Rangsons Electronics in an all-cash transaction. Rangsons Electronics is a electronics system design and manufacturing (ESDM) services company, headquartered in Mysore.

The acquisition positions Cyient strongly to expand into high-technology and high-value, design-led systems and solutions in line with the company's S3 (services, systems and solutions) strategy.

Krishna Bodanapu, Managing Director & CEO, Cyient said, "The new relationship will help Cyient expand its core business while deepening partnerships with OEM customers. I look forward to working closely with the Rangsons team to achieve the maximum synergy from this acquisition, and believe that this will make our offerings even more attractive to our customers.''

The market is holding on to its gains as the Sensex is up 373.30 points or 1.4 percent at 27880.84, and the Nifty is up 113.05 points or 1.4 percent at 8397.05. About 1837 shares have advanced, 857 shares declined, and 790 shares are unchanged.

HDFC, BHEL, ICICI Bank, Axis Bank and Tata Motors are top gainers in the Sensex. Top losers include M&M, Hero and Bajaj Auto.

Brent crude futures retreated from early highs above USD 58 and fell towards USD 57 a barrel on Friday as an abundance of oil erased earlier support drawn from a larger-than-expected fall in US crude stocks. US crude inventories fell by 1.8 million barrels in the last week as refineries raised production, compared with analysts' expectations of a decrease of 67,000 barrels.

Oil prices have fallen by half from last year's peak to a 5-5.5-year low, under pressure from a global glut of crude, exacerbated by the refusal of the world's top oil exporter, Saudi Arabia, to trim supply.

12:50 pm Interview: Aviation turbine fuel or ATF prices coming down is a much needed relief and a welcome move for airlines, says Sanjiv Kapoor, COO of SpiceJet . Jet fuel prices are down almost 23 percent since the peak in June 2014. With this, the annual fuel bill will reduce by Rs 700 crore, he adds. He says that the troubled airline is working on capitalisation plans for the company. The low-cost airline will fly 230 flights per day till the company is recapitalised. SpiceJet's market share has fallen to 14 percent from 21 percent.

12:30 pm Market outlook: Equities are likely to give a 13-15 percent compounded return over the next three years, but fixed income may give better returns over the next six months, says Manish Gunwani, Senior Fund Manager, ICICI Prudential AMC. He advises investing in financial services and capital goods stocks to play the economic recovery theme. He feels valuations of auto stocks are not as attractive as they were a year back. Gunwani expects aggregate corporate earnings to grow 15-16 percent this year and 20 percent next year. He sees the rupee depreciating slightly or hovering around current levels.

The market is celebrating new year in style with some massive gains. The Sensex is up 340.23 points or 1 percent at 27847.77 and the Nifty up 101.05 points or 1 percent at 8385.05. About 1746 shares have advanced, 788 shares declined, and 824 shares are unchanged.

HDFC is still up 4 percent while BHEl, Axis Bank, Tata Motors and ICICI Bank are top gainers in the Sensex. Among the losers are HUL, Hero and Bajaj Auto.

The banking stocks surged, with the Bank Nifty Index hitting a record high on hopes of faster reforms in the sector ahead of a two-day industry meet that starts today.

The one-of-a-kind retreat, spearheaded by Prime Minister Narendra Modi along with Reserve Bank of India (RBI) Governor Raghuram Rajan and Finance Minister Arun Jaitley, will include all top bankers to address issues such as consolidation, bad loans, financial inclusion and capital needs.

The Bank Nifty index surged as much as 1.4 percent to a record high of 19,010.60, surpassing the previous peak of 18,923.60 on December 23.

11:50 am HSBC PMI: In what could be a big sentiment boost, data showed that HSBC India Purchasing Managers' Index (PMI) climbed to a two-year high of 54.5 in December, up from 53.3 in the prior month. The index is a composite indicator designed to give an accurate overview of manufacturing operating conditions. Accelerated growth of the manufacturing sector was reflected by faster expansions in output, new business and foreign orders, noted the HSBC India release issed on Friday. Latest data also painted a brighter picture in terms of prices, as inflationary pressures eased during the month. Consumer Goods emerged as the best performing sector.

Commenting on the India Manufacturing PMI survey, Pranjul Bhandari, Chief India Economist at HSBC said, "Manufacturing activity momentum accelerated to a two-year high in December, led by a healthy increase in new orders from both at home and from abroad."

11:30 am How will crude price impact consumer cos? As crude oil prices fall 47 percent in rupee terms over the past five months, CLSA feels consumer companies will benefit from it but growth pick may still take some time.

"While a part of the savings would be ploughed back in the form of higher adverstising and promotion (A&P), there would still be a positive impact on margins. The demand environment continues to remain weak, though, most companies expect a gradual pick-up in FY16," the firm says in a report.

It also feels that decline in oil prices may also help in lowering the freight costs for the industry. It sees  Asian Paints and HUL as the key beneficiaries where oil derivatives form almost 40-45 percent of the input base.

CLSA warns that as the consumers tread through a challenging environment benign input prices also imply lesser contribution from price hike which may further impact the overall growth rate, negatively.

The market is still maintaining its uptrend with major boost from banks and auto stocks. The Sensex is up 318.65 points or 1.2 percent at 27826.19 and the Nifty is up 95.70 points or 1.2 percent 8379.70. About 1657 shares have advanced, 621 shares declined, and 863 shares are unchanged.

HDFC is up 3 percent while BHEL, Axis Bank, ICICI Bank and Tata Motors are up 2 percent each. Among the losers are Hero and Bajaj.

From other asset classes bonds are lower on concerns of persistent fiscal concerns and fear of lower oil prices not translating into lower inflation. Rupee is little changed

PSU banks are in focus as the Gyan Sangam kicks off today. Issues on the agenda include consolidation, inclusion, priority sector lending and hr amongst others.

Globally, Hong Kong and Indonesian markets lead gains in light post holiday trade. Brent trades above USD 57 per barrel.

11:00 am HSBC PMI: In what could be a big sentiment boost, data showed that HSBC India Purchasing Managers' Index (PMI) climbed to a two-year high of 54.5 in December, up from 53.3 in the prior month. The index is a composite indicator designed to give an accurate overview of manufacturing operating conditions.

Accelerated growth of the manufacturing sector was reflected by faster expansions in output, new business and foreign orders. Latest data also painted a brighter picture in terms of prices, as inflationary pressures eased during the month. Consumer goods was the best performing of the broad sectors monitored.

Commenting on the India Manufacturing PMI survey, Pranjul Bhandari, Chief India Economist at HSBC said: "Manufacturing activity momentum accelerated to a two-year high in December, led by a healthy increase in new orders from both at home and from abroad. A steep rise in new orders from the consumer sector more than offset a slowdown in new order growth from investment goods

10:50 am Market check: The Sensex is up 326.99 points or 1.2 percent at 27834.53, and the Nifty is up 95.75 points or 1.2 percent  at 8379.75. About 1625 shares have advanced, 595 shares declined, and 864 shares are unchanged.

HDFC is up 3 percent while Axis Bank is up 2 percent.

10:33 am Interview: Aviation turbine fuel or ATF prices coming down is a much needed relief and a welcome move for airlines, says Sanjiv Kapoor, COO of SpiceJet. Jet fuel prices are down almost 23 percent since the peak in June 2014.

With this, the annual fuel bill will reduce by Rs 700 crore, he adds. He says that the troubled airline is working on capitalisation plans for the company.

The low-cost airline will fly 230 flights per day till the company is recapitalised. SpiceJet's market share has fallen to 14 percent from 21 percent.

The market is back into action with a roar. The Sensex is up 274.44 points or 1 percent at 27781.98, and the Nifty is up 79.65 points or 0.9 percent at 8363.65. About 1393 shares have advanced, 439 shares declined, and 877 shares are unchanged.

HDFC is up 2 percent while Tata Motors, ICICI Bank, ONGC and BHEL are top gainers in the Sensex. Among the losers are Bajaj Auto, Bharti Airtel and Hero.

The rupee fell by 14 paise to 63.49 a dollar in early trade today at the Interbank Foreign Exchange market as the US currency strengthened overseas. Dealers said besides dollar's gains against other currencies overseas, increased demand for the American unit from importers also put pressure on the rupee.

Domestic equity markets opening with early gains, however, capped the losses, they said.

The euro started the new year at 29-month lows in Asia after the head of the head of the European  Central Bank fanned expectations it would take bolder steps on stimulus this month, so underlining the US dollar's rate advantage.

The ECB council meets on Jan. 22 and markets are wagering it will finally decide to start buying sovereign debt, following in the footstep of the US, UK and Japan. That kept the single currency down at USD 1.2082, depths last seen in mid-2012, while the dollar held firm against a basket of currencies having ended 2014 with its biggest annual increase since 1997.
 
9:55 am Caution:  European Central Bank President Mario Draghi said the risk of the central bank not fulfilling its mandate of preserving price stability is higher now than half a year ago, underlining its readiness to act early this year should it become necessary.

In an interview with German financial daily Handelsblatt, Draghi urged politicians to implement the necessary reforms, reduce tax burden and red tape to support the euro zone recovery, which Draghi said was "fragile and uneven".

There was a limited risk of deflation in the euro zone, Draghi said, but if inflation remained too low for too long and led to receding inflation expectations, the ECB would need to act to fulfill its mandate.

"The risk that we do not fulfill our mandate of price stability is higher than six months ago," Draghi was quoted as saying in an interview.

9:45 am Buzzing: Shares of  SRF jumped over 10 percent intraday. The company has acquired Global DuPont Dymel, pharmaceutical propellant business of American chemical giant DuPont for USD 20 million payable in cash.

Under the agreement SRF will own Du Font's 'Dymel' brand and receive the technology and knowhow for setting up its own 'current Good Manufacturing Practices' (cGMP) facility for manufacturing HFC 134a Pharma grade. DuPont will supply SRF the product from its existing facility till SRF's facility is approved.

SRF Limited has two plants for manufacture of technical grade of HFC 134a. It is envisaged that HFC 134a pharma will form a part of the downstream products from these plants.

9:30 am Market outlook: Kunj Bansal of Centrum Wealth Management does not see a major downside for the market. According to him the trend for the market is up even though one could see a small correction in the next 10-15 days. However, the correction may not be significant enough to offer a significant entry opportunity. He is upbeat on the PSU banking space and would be a buyer in them.

He thinks there is more value in PSU banks than private sector banks. Moreover, the non-performing assets (NPAs) are also likely to improve if the overall economy shows an improvement believes Bansal. He is also positive on the autos from a medium to long term timeframe. However, in the short-term the higher excise duty and poor December sales could impact them, he says.

The market has opened on a positive note. The Sensex is up 104.29 points at 27611.83 and the Nifty is up 32.40 points at 8316.40. About 715 shares have advanced, 164 shares declined, and 884 shares are unchanged.

BHEL, ONGC, Sesa Sterlite, Bharti Airtel and Tata Steel are major gainers while Tata Power, Coal India, Hindalco, Bajaj Auto and GAIL are laggards.

The Indian rupee opened lower by 8 paise at 63.43 per dollar versus 63.35 Thursday. Pramit Brahmbhatt of Veracity said, "Rupee is expected to depreciate as dollar demand from banks and oil importers would further hurt the rupee. Investors will trade cautiously ahead of US data due for the day. Rupee is expected to trade in a range of 63-63.70/dollar today."

Most of the Asian markets too were trading flat in the morning. The US and European markets were closed for the New Year.

Gold inched up as higher oil prices boosted its safe-haven appeal, but the metal looked set to post its third straight weekly loss, weighed down by a strong dollar. US crude futures hit USD 55.11 a barrel before easing below USD 55 a barrel on the first trading day of 2015 in Asia, supported by last week's larger-than-expected fall in US crude stocks.

Higher oil prices support gold as the metal is seen as a hedge against oil-led inflation.