Key benchmark indices extended initial gains in morning trade. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit one-week high. The Sensex was up 248.37 points or 1.02%, up 151.99 points from the day's low and off 69.32 points from the day's high. The market breadth indicating the overall health of the market was quite strong, with more than 3 gainers for every loser on BSE. The BSE Small-Cap index was up more than 2%.The BSE Mid-Cap index was up more than 1%. Both these indices outperformed the Sensex.
Auto stocks edged higher on renewed buying. Maruti Suzuki India extended Thursday's rally triggered by a foreign brokerage putting an aggressive target price on the stock. Ashok Leyland jumped to 52-week high after reporting strong Q4 result after market hours on Thursday, 22 May 2014. Among two-wheeler makers, TVS Motor Company scaled record high. Realty stocks were in demand on renewed buying.
Key benchmark indices edged higher in early trade on firm Asian stocks. Key benchmark indices extended initial gains in morning trade. The Sensex and the 50-unit CNX Nifty, both, hit one-week high.
At 10:15 IST, the S&P BSE Sensex was up 248.37 points or 1.02% to 24,622.77. The index jumped 317.69 points at the day's high of 24,692.09 in morning trade, its highest level since 16 May 2014. The index rose 96.38 points at the day's low of 24,470.78 in early trade.
The CNX Nifty was up 72.15 points or 0.99% to 7,348.55. The index hit a high of 7,363.45 in intraday trade, its highest level since 16 May 2014. The index hit a low of 7,293.90 in intraday trade.
The market breadth indicating the overall health of the market was quite strong, with more than 3 gainers for every loser on BSE. On BSE, 1,845 shares gained and 506 shares fell. A total of 81 shares were unchanged.
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The BSE Mid-Cap index was up 114.17 points or 1.34% at 8,632.39. The BSE Small-Cap index was up 188.18 points or 2.1% at 9,148.88. Both these indices outperformed the Sensex.
The total turnover on BSE amounted to Rs 1369 crore by 10:15 IST on BSE, compared with Rs 464 crore by 09:30 IST.
Among the 30-share Sensex pack, 26 stocks gained and rest of them declined.
Auto stocks edged higher on renewed buying. Tata Motors rose 1.22%.
Maruti Suzuki India rose 1.08% to Rs 2,287.50. The stock extended Thursday's 4.44% rally triggered by a foreign brokerage putting an aggressive three-year target of Rs 4,500 on the stock.
Mahindra & Mahindra (M&M) rose 2.37% to Rs 1,161.
Ashok Leyland jumped 10.55% to Rs 31.95 after hitting 52-week high of Rs 32.30 in intraday trade. Ashok Leyland's net profit surged 142.2% to Rs 363.39 crore on 17.31% fall in total income to Rs 3092.51 crore in Q4 March 2014 over Q4 March 2013. The result was announced after market hours on Thursday, 22 May 2014.
Ashok Leyland's net profit slumped 93.22% to Rs 29.38 crore on 20.19% decline in total income to Rs 10009.94 crore in the year ended 31 March 2014 (FY 2014) over the year ended 31 March 2013 (FY 2013).
"In fiscal year ended March 2014 (FY 2014), we retained our market share in an intensely competitive medium and heavy commercial vehicles (M&HCV) market that declined by over 25%, second year in a row," said Mr Vinod K Dasari, MD, presenting the annual results of Ashok Leyland, the Hinduja Group flagship. "In a very tough year, we restructured ourselves to reduce the overall fixed cost base while continuing to invest in new products, network, quality and sales processes. We also sold non-core assets, and reduced our working capital drastically, and used the funds to reduce debt."
Shares of two-wheeler makers were mostly higher. TVS Motor Company jumped 6.31% to Rs 136.50 after hitting a record high of Rs 137.70 in intraday trade.
Hero MotoCorp rose 1.79%. Bajaj Auto shed 0.28%.
Realty stocks were in demand on renewed buying. DLF (up 4.2%), Godrej Properties (up 1.58%), Parsvnath Developers (up 4.9%), Oberoi Realty (up 1.03%), Housing Development & Infrastructure (HDIL) (up 1.98%), Sobha Developers (up 1.39%), D B Realty (up 3.48%) and Unitech (up 4.78%) gained. Indiabulls Real Estate fell 1.59%.
After Bharatiya Janata Party (BJP) led National Democratic Alliance's (NDA) landslide victory in the recently concluded Lok Sabha election, investors are expecting measures from the incoming government to revive the Indian economy. There are expectations that Narendra Modi will be in a position to replicate the economic success he enjoyed in Gujarat state when he takes over as the country's Prime Minister. With Modi at the helm of affairs, Gujarat's economy expanded by 10.1% a year, on average and adjusting for inflation, from 2001 and 2012, compared with 7.7% growth a year for India's economy as a whole. India's GDP growth slowed sharply at 4.7% in Q3 December 2013. Investors hope that a BJP-led government would be able to accelerate policy reforms and overhaul the country's poor infrastructure. Investors will now be keenly watching policy announcements from the new government to drive a turnaround in the investment cycle.
Ever since NDA's victory in the election last week, speculation has been rife about the likely allocation of key ministerial portfolios in the Modi-led NDA government.
Modi will be sworn in as India's next Prime Minister on Monday, 26 May 2014, evening at the Rashtrapati Bhawan.
The first budget of the new government is expected by July 2014. An interim budget was presented by P. Chidambaram in February this year. Essentially, in the nature of a vote on account, the interim budget was intended to get Parliament approval for expenditure to be incurred during the first few months of fiscal year 2014-15 due to Lok Sabha elections.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014, as consumer-price inflation eased to a two-year low and as the rupee firmed up against the dollar.
Asian stocks edged higher on Friday, 23 May 2014, on signs of growth in the world's largest economies. Key benchmark indices in Taiwan, Singapore, Japan and Indonesia were up 0.09% to 1.09%. Key benchmark indices in China and South Korea, Hong Kong were off 0.03% to 0.08%.
Thailand's army staged its 12th coup in eight decades on Thursday, 22 May 2014, as the army chief said he was seizing control to restore peace. Thailand's military seized control following a six-month political stalemate that has sapped economic growth.
Trading in US index futures indicated that the Dow could advance 10 points at the opening bell on Friday, 23 May 2014. US stocks built on advances from the previous session and closed modestly higher on Thursday, 22 May 2014, as data showing strength in manufacturing boosted confidence in the global economy.
The Markit Economics preliminary index of US manufacturing increased to 56.2 in May from 55.4 a month earlier as output accelerated, the London-based group said on Thursday, 22 May 2014. Readings above 50 for the purchasing managers' measure indicate expansion and the May figure was the highest in three months.
In other economic news, new applications for unemployment benefits rose sharply in mid-May, reversing a big drop earlier in the month that put initial claims at a seven-year low. Sales of existing homes rose 1.3% in April to a seasonally adjusted annual rate of 4.65 million, the National Association of Realtors reported Thursday.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 17-18 June 2014. The Fed on 30 April 2014 said after a monetary policy review that it will keep the benchmark interest-rate target at almost zero for a "considerable time" after its bond-buying program ends. The FOMC also reduced monthly debt purchases to $45 billion, its fourth straight $10 billion cut, and said further reductions are likely in "measured steps" if the economy continues to improve.
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