The Sensex and the Nifty traded in a narrow band near the day's high in afternoon trade. The Nifty held firmly above the 12,250 level. Good manufacturing PMI data for December supported buying in domestic shares.
At 13:24 IST, the barometer index, the S&P BSE Sensex, was up 258.35 points or 0.63% at 41,564.37. The Nifty 50 index was up 79.20 points or 0.65% at 12,261.70.
In the broader market, the S&P BSE Mid-Cap index was up 0.89% while the S&P BSE Small-Cap index was up 1.28%.
The market breadth was titled in the favour of buyers. On the BSE, 1600 shares rose and 701 shares fell. A total of 142 shares were unchanged. In Nifty 50 index, 37 stocks advanced while 13 stocks declined.
Macros:
The headline seasonally adjusted IHS Markit India Manufacturing PMI rose to 52.7 in December, from 51.2 in November. The number pointed to the joint-strongest improvement in the health of the sector for ten months. However, owing to a weak performance in October and November, the average quarterly reading for Q3 FY19/20 was the lowest since the three months to September 2017.
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Factories benefited from a rebound in demand, and responded by scaling up production to the greatest extent since May. There were also renewed increases in input purchasing and employment during December. However, the degree of optimism signalled at the end of 2019 was the weakest in just under three years, reflecting concerns over market conditions, which could restrict job creation and investment in the early part of 2020. At the same time, price indicators showed accelerated rates of inflation for both input costs and output charges. The latter reflected a combination of improved pricing power, given the favourable demand environment, and efforts to protect margins from cost rises, Pollyanna de Lima, principal economist at IHS Markit, said.
Stocks in Spotlight:
UltraTech Cement (up 4.03%), Tata Steel (up 3.07%), Vedanta (up 2.91%), JSW Steel (up 2.91%) and Grasim Industries (up 2.65%) advanced.
BPCL (down 0.55%), Power Grid Corporation of India (down 0.38%), Infosys (down 0.34%) and TCS (down 0.31%) declined.
Eicher Motors slipped 2.59% to Rs 21500. The company's total commercial vehicles (CV) sales declined 19.1% to 5,042 units in December 2019 from 6,236 units in December 2018. Total two-wheeler sales fell 13% to 50,416 units in December 2019 as against 58,278 units in December 2018.
Bajaj Auto slipped 0.67% to Rs 3125.80 after total auto sales fell 16.66% to 3.36 lakh units in December 2019 from 4.03 lakh units in November 2019. Total auto sales, however, declined marginally by 3% compared with 3.46 lakh units in December 2018. Total motorcycle sales slipped by 5% to 2.84 lakh units, while total commercial vehicle sales recorded 8% jump to 51,253 units in December 2019 over December 2018.
Tata Motors rose 3.04% to Rs 190 after reporting 14.05% jump in total auto sales to 46,903 units in December 2019 compared with 41,124 units in November 2019. Total auto sales, however, fell 13.84% last month from 54,439 units in December 2018. Total domestic sales declined 12% to 44,254 units in December 2019 as compared to 50,440 units in December 2018. Passenger vehicles segment saw sales decline 10% to 12,785 units while the commercial vehicles sales witnessed 15% fall to 34,082 units in December 2019 over December 2018
Shares of Coal India were trading 0.28% lower at Rs 211.30. The company's total coal production in December 2019 was 58.02 million tonnes as compared to 54.14 million tonnes in December 2018, recording a rise of 7.2%. The coal offtake recorded a 1.9% rise to 53.63 million tonnes in December 2019 as against 52.61 million in December 2018.
Foreign Markets:
Markets in Europe opened mostly lower while Asian stocks were trading mostly higher buoyed by Beijing easing monetary policy to support slowing growth.
China's central bank on Wednesday said that it would cut the amount of cash that banks must hold as reserves, releasing around 800 billion yuan in funds effective 6 January 2020.
A private survey released on Thursday showed China's manufacturing activity expanded in the month of December. The Markit/Caixin Purchasing Managers' Index (PMI) for manufacturing came in at 51.5, compared to 51.8 in November.
In US, markets were closed on account of the New Year holiday on Wednesday.
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