Sensex up 181 points, Nifty above 8500 for 1st time since Aug 2015

Indian equity benchmarks participated in global rally for the second consecutive session on Tuesday, hitting 11-month closing highs ahead of industrial output and CPI inflation data due later today.

The 30-share BSE Sensex climbed 181.45 points or 0.66 percent to 27808.14, supported by banking & financials, oil and metals stocks.

The 50-share NSE Nifty closed above the 8500 level for the first time since August 14, 2015. The index jumped 53.15 points or 0.63 percent to 8521.05.

Expectation of global easing of liquidity or global easing of rates has obviously helped the markets not only in India, but across other markets also, says Rahul Singh of Ampersand Capital Investment Advisors LLP.

According to him, as the market heads into earnings season, some consolidation is expected but a correction, if it happens, will not be deep.

The BSE Midcap index gained 0.5 percent, closing at record high despite the negative market breadth. About 1522 shares declined against 1237 advancing shares on Bombay Stock Exchange.

Global markets remained strong today as well. Asia closed higher, tracking positive lead from the Wall Street. Nikkei extended its rally, up 2.5 percent as stimulus comments made by Japanese Prime Minister Shinzo Abe late on Monday helped to weaken the yen. China's Shanghai was up 1.8 percent and Hong Kong's Hang Seng rose 1.65 percent.

European markets like France's CAC and Germany's DAX were up 1.65 percent (at 16 hours IST) as uncertainty over the UK's political scene diminished after news of the imminent appointment of Home Secretary Theresa May as UK prime minister. Britain's FTSE was flat. Brent crude oil prices jumped over 2 percent on weaker US dollar.

On home turf, Nifty Bank ended at fresh 11-month closing high, up 1.5 percent. It was majorly supported by ICICI Bank that contributed 40 percent to Nifty gain & over 60 percent to Nifty Bank gain, up 4.68 percent.

ICICI Bank in its annual general meeting yesterday said shareholders approved fundraising up to Rs 25,000 crore in this fiscal and it will launch IPO for ICICI Prudential Life this year. Meanwhile, rating agency S&P Global has removed bank's Bahrain branch bond from credit watch negative and affirmed 'BBB-' rating.

IDFC Bank was up 8.4 percent after it acquired Tamil Nadu-based micro finance company Grama Vidiyal Micro Finance.

Hindalco Industries gained 4.8 percent and Nalco rallied 13.3 percent after New York-based aluminum company Alcoa's second quarter (April-June) earnings beat analysts' expectations.

Cairn India and Vedanta rallied 7-8 percent. The merger of both companies is now imminent as Life Insurance Company (LIC) has given an informal green light for it, sources have told CNBC-TV18.

Among other largecaps, Tata Steel surged 4.6 percent followed by HDFC, Axis Bank, Reliance Industries, Maruti Suzuki and ONGC with 1-2 percent rally. ITC, Asian Paints, Sun Pharma, HUL, Dr Reddy's Labs, Cipla and Coal India fell 0.5-1 percent.

Quess Corp, the subsidiary of travel company Thomas Cook, has a stellar debut. The stock closed at Rs 503.10, up 58.7 percent over its issue price of Rs 317.

3:30 pm Market closing: The market ended at 11-month closing high. The Sensex was up 181.45 points or 0.7 percent at 27808.14, and the Nifty was up 53.15 points or 0.6 percent at 8521.05. About 1233 shares have advanced, 1522 shares declined, and 172 shares are unchanged. Midcap index was at a record high.

Tata Steel, ICICI Bank, Axis Bank, Maruti and HDFC are gainers while Coal India, Cipla, Dr Reddy's, Asian Paints and HUL are losers in the Sensex.

3:10 pm Bond: Indian government bonds rallied, with the benchmark 10-year yields at over three-year lows, as investors bet on benign inflation data later in the day and awaited a government announcement on the next RBI governor.

The rally also tracked gains in emerging markets this week on a combination of upbeat US data, expectations of more stimulus from global policymakers, and global investors seeking higher returns.

Foreign investors bought a net USD 76 million worth of Indian government debt on Monday, their highest purchase in four sessions, and remained net buyers of debt worth USD 157.66 million for July, helping send bond yields down 12-15 basis points across the curve.

2:59 pm Market Update: Equity benchmarks extended rally in last hour of trade with the Sensex rising 149.18 points to 27775.87 and the Nifty climbing 43.25 points to 8511.15.

2:50 pm Acquisition: IDFC Bank has entered into an agreement with Grama Vidiyal Micro Finance Limited (GVMFL) for acquisition of 100 percent equity share capital of GVMFL. The stock gained 12 percent intraday.

2:40 pm Buzzing: Sical Logistics shares rallied 6 percent intraday after its subsidiary signed the licence agreement with Kamarajar Port in Chennai.

"Subsidiary Sical Iron Ore Terminals has executed the licence agreement with Kamarajar Port for modification of the existing iron ore terminal on "as is where is"," says the company in its filing.

The modification will also include handling common user coal at Kamarajar Port.

The project, which signed agreement on July 11, is on design-build-finance-operate-transfer (DBFOT) basis.

2:25 pm Oil Update: Oil futures rose as an interruption in Iraqi crude loadings at Basra threatened to tighten supplies, but prices held close to two-month lows hit in the previous session as investors continued to slash their bullish bets.

Brent crude oil futures were trading at USD 46.87 per barrel, up 1.25 percent from their last close. US West Texas Intermediate (WTI) crude was up 1.03 percent at USD 45.22 a barrel.

2:15 pm Market Expert: As the market heads into earnings season, some consolidation is expected. But a correction, if it happens, will not be deep, says Rahul Singh of Ampersand Capital Investment Advisors LLP.

Expectation of global easing of liquidity by central banks has helped markets, he says.

2:00 pm Market Check
Buying interest continued for the second consecutive session as the Sensex gained 108.27 points at 27734.96 and the Nifty rose 30.20 points to 8498.10 despite negative market breadth.

About 1542 shares declined against 1088 advancing shares on Bombay Stock Exchange.

Hindalco shares surged 4 percent and Nalco jumped nearly 7 percent after better-than-expected earnings by Alcoa.

1:45 pm Interview: Microfinance and non-vehicle finance loan books will be the new revenue growth drivers for IndusInd Bank in the coming quarters, says MD & CEO Romesh Sobti in an interview to CNBC-TV18. With an over 30 percent growth in retail and corporate credit, the bank Monday reported net interest income (NII) growth above estimates at 38 percent with profit surging 26 percent. Sobti says 70 percent of the retail book is vehicle financing which after languishing for nearly 2 years has picked up pace. Although June was a cyclically weak month for commercial vehicle (CV) sales, he sees strong uptick in demand in the second half for both commercial vehicles and light commercial vehicles. Even two-wheelers is slowly picking up, he says.

1:30 pm New listing: Following the spectacular listing, the management of Quess Corp is upbeat on growth prospects for the company going forward. All verticals of Quess are capable of growing in range of 20-25 percent, says Ajit Issac, CMD & CEO of the company. Speaking to CNBC-TV18, Isaac says the aim is to take margins to 7 percent from current 4-5 percent level. The internal target, however, is 8 percent. Another target is to raise return on capital employed (RoCE) to around 25 percent this fiscal. Most of the company's loss-making subsidiaries have broken even. While some are making profits, aim is to grow other subsidiaries also, Issac says. Quess Corp has set aside Rs 160 core as working capital, Rs 80 crore for acquisitions and Rs 70 crore for capital spend. Issac says that the company is looking at acquiring one or two businesses in next financial year.

The market is still holding gains. The Sensex is up 74.43 points or 0.3 percent at 27701.12 and the Nifty is up 20.25 points or 0.3 percent at 8488.15. About 1159 shares have advanced, 1437 shares declined, and 146 shares are unchanged.

ICICI Bank, Maruti, Tata Steel, Axis Bank and ONGC are top gainers while BHEL, Coal India, HUL, Cipla and Sun Pharma are losers in the Sensex.

Amid a weak trend overseas, gold prices fell 0.15 percent to Rs 31,532 per 10 gram in futures trade today as participants cut down their bets.

Analysts said a weak trend in the overseas markets where gold fell from the highest in more than two years as equities surged and the dollar advanced following a jump in the US payrolls, reducing demand for the precious metal as a store of value weighed on the precious metal prices in futures trade.

Globally, gold slid 0.8 percent down at USD 1,355.49 an ounce in New York yesterday.

12:59 pm Market Update: Equity benchmarks remained higher as the Sensex rose 118.71 points to 27745.40 and the Nifty advanced 35.15 points to 8503.05.

About 1367 shares declined against 1187 advancing shares on Bombay Stock Exchange.

12:45 pm Europe opens: European stocks opened higher as uncertainty over the UK's political scene diminishes with the imminent appointment of Home Secretary Theresa May as UK prime minister.

The pan-European Stoxx 600 index opened 0.3 percent higher.

In Asia, markets were mixed, as Japan shares surged as investors digested stimulus comments made by Japanese Prime Minister Shinzo Abe late on Monday, helping to weaken the yen.

12:35 pm Interview: Surana Solar is on a major drive to expand exports to Europe and expects 50 percent of its revenues to come from exports by the year-end, Managing Director Narender Surana says.

Speaking to CNBC-TV18, Surana said that Chinese imports had been eating into the share of domestic players in the local market and that with the government's focus on solar energy, he hoped to relief in the form of interest subvention.

"The total market for photovoltiac cells is 6000-7000 MW per year and Indian manufacturers only supply around 1000-1500 MW per year," he said, adding that local taxes make it unviable for domestic products to compete with Chinese imports.

Still, shares of Surana have seen activity in the equity market, rising 40 percent of the last one month.

12:20 pm Cairn Energy seeks compensation: British explorer Cairn Energy has sought USD 5.6 billion in compensation from the Indian government for raising a retrospective tax demand of Rs 29,047 crore on 10-year old internal reorganisation of its India unit.

In a 160-page 'Statement of Claim' filed with an international arbitration panel on June 28, the Edinburgh-based company sought withdrawal of the tax demand and declaring that India has "failed to uphold its obligations" under the UK-India Investment Treaty by not giving its investments in the country "fair and equitable treatment."

It sought USD 1.05 billion in compensation for the loss of value its 9.8 per cent shareholding in its erstwhile subsidiary Cairn India suffered following Income Tax Department raising the tax demand in January 2014 and attaching the shares.

12:00 pm Market Check
The market remained higher in noon trade with the Nifty hovering around 8500 level, supported by banking & financials and oil stocks.

The Sensex gained 104.76 points or 0.38 percent at 27731.45 and the Nifty rose 30.50 points or 0.36 percent to 8498.40. The broader markets also traded in line with benchmarks as the BSE Midcap was up 0.55 percent despite negative market breadth.

About 1261 shares declined against 1171 advancing shares on the Bombay Stock Exchange.

Thomas Cook shares fell 2.5 percent on the day of listing of its subsidiary Quess Corp that rallied more than 50 percent on debut.

ICICI Bank, Axis Bank, Maruti Suzuki, ONGC and Tata Steel gained 1.5-2 percent while HUL, L&T, Sun Pharma, Asian Paints, HDFC Bank, Dr Reddy's Labs and Cipla fell 0.2-1 percent.

11:30 am Interview: India's commercial vehicle industry is likely to grow by 15-20 percent in FY17, Ashok Leyland CFO Gopal Mahadevan says.

In an interview with CNBC-TV18, Mahadevan said the company is hopeful of growing at at least industry rate despite two months of declining growth.

"First quarter is too early to judge the company's performance," he added.

He is also hopeful that the Euro-IV (will be implemented across the country on April 1, 2017) norms will lead to pre buying in fourth quarter of FY17.

The company has already received orders for 3,600 buses and the execution is expected in FY17. The market share of the company in bus segment has risen to 36 percent from 33 percent.

The market seems to be consolidating after a strong rally. The Sensex is up 59.09 points or 0.2 percent at 27685.78, and the Nifty up 18.75 points or 0.2 percent at 8486.65. About 1108 shares have advanced, 1158 shares declined, and 127 shares are unchanged.

ICICI Bank, Tata Steel, Axis Bank, Maruti and ONGC are top gainers in the Sensex. BHEL, Coal India, Dr Reddy, Sun Pharma and Asian Paints are losers in the Sensex.

Quess Corp made a stellar market debut, listing at Rs 500 per share, up by a whopping 58 percent on NSE from its issue price of Rs 317 per share. The staffing company, partly owned by Thomas Cook raised Rs 400-crore from its initial public offer (IPO) which was open for subscription from June 29 to July 1.

Quess Corp's IPO was oversubscribed 145 times earlier this month, emerging as the most oversubscribed IPO in the past 9 years. Promoted by Ajit Isaac and Thomas Cook (India), the company was set up in 2007 which offers comprehensive solutions, including recruitment, temporary and technology staffing, and IT products and solutions, among others.

10:45 am Interview: India's commercial vehicle industry is likely to grow by 15-20 percent in FY17, Ashok Leyland CFO Gopal Mahadevan says.

Mahadevan said the company is hopeful of growing at at least industry rate despite two months of declining growth.

"First quarter is too early to judge the company's performance," he added.

He is also hopeful that the Euro-IV (will be implemented across the country on April 1, 2017) norms will lead to pre buying in fourth quarter of FY17.

The company has already received orders for 3,600 buses and the execution is expected in FY17.

The market share of the company in bus segment has risen to 36 percent from 33 percent.

10:30 am Buzzing: Edelweiss Financial Services shares gained 4 percent intraday after the company received approval from the insurance regulator to set up general insurance company.

"The Insurance Regulatory & Development Authority of India (IRDAI) has accepted the registration application form IRDA /R1, for setting up a general insurance company in India, filed by Edelweiss General Insurance Company, a wholly owned subsidiary," says the company in its filing.

This is the first step of regulatory clearances required for carrying on the business as general insurance company in India.

10:15 am FII View: Surendra Goyal of Citi says he expects Citi coverage universe Q1FY17 earnings to be flattish (YoY).

"Earnings, ex-commodities, are expected to be up 6 percent (YoY) versus a sharp decline in Q4FY16. Q1FY17 earnings are nearly 23 percent of our FY17 expectation," he explains.

He remains constructive with nearly 6 percent upside to 1-year target of 28,800 for the Sensex. "The Sensex is up 10 percent over the past 3 months and we would see enhanced buying opportunities on any dips," Goyal says.

10:00 am Market Check
Equity benchmarks as well as broader markets continued to trade higher with marginal gains, tracking positive global cues.

The Sensex rose 59.17 points or 0.21 percent to 27685.86 and the Nifty advanced 17.45 points or 0.21 percent to 8485.35. About 1015 shares advanced against 805 declining shares on BSE.

Quess Corp has stellar listing today, rallying more than 50 percent in opening. It traded at Rs 494.75 against issue price of Rs 317. However, Thomas Cook, the owner of Quess Corp, declined 1.6 percent.

ICICI Bank, HDFC Bank, Maruti Suzuki, Bharti Airtel, NTPC and Tata Steel were gainers in morning trade, up 1-2 percent while Coal India and BHEL fell over a percent. TCS, Sun Pharma, Infosys, Dr Reddy's Labs, Lupin and Cipla were also down on profit booking.

9:55 am Monsoon update: Monsoon rains will cover the whole of India in the next 48 hours, the country's weather office said, boosting hopes of a rise in farm output and incomes after two straight years of drought.

The monsoon has yet to cover parts of Rajasthan and Gujarat and rains will be 107 percent of long period average in July, B P Yadav, head of the national weather forecasting centre of the India Meteorological Department told Reuters.

Monsoon rains, the lifeblood of India's agriculture-dependent economy, arrived a week later than usual this year and are crucial for the planting of summer-sown crops such as cotton, rice, soybean and sugarcane.

9:45 am International market: The rally in global equities is expected to continue in the near-term, says Geoffrey Dennis of UBS. UBS does not believe that the US Federal Reserve will move rates any time before December.

However, Dennis says the problem with these rallies is that valuations get stretched. Even with global uncertainties, India's growth is holding well, but concerns over earnings stay.

As long as there is no radical change in India's monetary policy with exit of Raghuram Rajan, the country will continue to attract funds that have gone out in last 18 months, Dennis says.

9:30 am Macro data poll: The consumer price index (CPI) for the month of June is seen at 5.75 percent versus 5.76 percent for the month of May. The range is likely to be between 5.5-6.2 percent. The core CPI is seen at 4.7 percent, the same as was seen for the earlier month. This CPI is likely to flat because of the base effect although the vegetable prices are high. The food inflation for the same period last year had risen month on month.

The consumer price index (CPI) for the month of June is seen at 5.75 percent versus 5.76 percent for the month of May. The range is likely to be between 5.5-6.2 percent. The core CPI is seen at 4.7 percent, the same as was seen for the earlier month. This CPI is likely to flat because of the base effect although the vegetable prices are high. The food inflation for the same period last year had risen month on month.

The market has opened at fresh 11-month high with the Nifty hitting 8500. The 50-share index is up 34.70 points or 0.4 percent at 8502.60 and the Sensex is up 98.77 points or 0.4 percent at 27725.46. About 385 shares have advanced, 94 shares declined, and 26 shares are unchanged.

Axis Bank, HDFC, Bharti Airtel, Maruti and NTPC are top gainers while Coal India, BHEL, TCS, Infosys and Cipla are losers in the Sensex.

The Indian rupee opened marginally lower by 5 paise at 67.17 per dollar on Tuesday versus 67.12 Monday. The dollar near a one-week high against the yen following Japanese Prime Minister Shinzo Abe's call for a fresh round of fiscal stimulus.

Ashutosh Raina of HDFC Bank said, "The robust non-farm payroll number has triggered a global risk-on rally, as concerns about US economy losing momentum have been set aside. This coupled with expectations of more stimulus measures around the world has resulted in risk rallies across and EM currencies reacting higher against dollar."

Asian markets were broadly higher with shares in Japan leading the region. The Nikkei 225 was up 3.34 percent while Hong Kong's Hang Seng was about 0.81 percent higher. China's Shanghai Composite was up around 0.35 percent.

US stocks closed higher on Monday as investors cheered an election in Japan and extended a jobs-report rally. The S&P 500 index closed at a new all-time high and also posted a new all-time intraday high of 2,143.