The benchmark indices have extended their previous week's rally after European finance ministers authorised a loan payout to Greece and US manufacturing accelerated in June. The Sensex is at 18,847, higher by 85 points, and the Nifty is at 5,657, up 30 points. The midcap index is at 69,741, higher by 70 points and the smallcap index is at 8,318, up 93 points.
The markets had started the day with a bang in the wake of firm global cues, with the BSE benchmark gaining nearly 200 points and the Nifty testing the crucial 5,700 mark at opening bell. The Asian bourses were going strong; Hang Seng, Nikkei and Shanghai were up more than 1% each.
The European finance ministers had agreed over the weekend to provide a loan of 8.7 billion euros ($12.7 billion) to Greece under last year’s 110 billion-euro bailout by July 15 after the Greek parliament passed a legislation enabling tax increases, spending cuts and privatisations as part of the required austerity package. And in the US, the Institute for Supply Management’s factory index climbed to 55.3 last month from 53.5 in May, the first gain in four months.
While the markets surrendered a part of their gains in the early part of trade itself, they still have a confident look as we venture into the last hour of trade. It may be recollected that the Nifty had rallied from lows of 5,250 and sailed past 5,600 in six trading sessions till last Thursday. Going forward, the monsoons and first quarter earnings will shape the direction of the markets. HDFC unveils its first quarter results on July 8 and Infosys will unveil its results on July 12.
Reliance Infra has soared by 5.9% at Rs 573 to emerge as the leading gainer on the BSE. DLF has jumped 4.7%, extending its rally for the second straight day, on reports that it plans to sell its shareholding in two IT special economic zones in Pune and Noida for Rs 1300 crore.
Index heavyweight RIL rose 1% to Rs 871 on reports its retail subsidiary Reliance Retail has appointed two former Wal-Mart executives to run the operations ahead of the expected foreign direct investment in the retail sector. The stock had tumbled nearly 4% on Friday after the CBI reportedly searched the house of V.K. Sibal, the former chief of the Directorate General of Hydrocarbons, the upstream regulator, after the state auditor said there may have been inflated costs for some of Reliance Industries' exploration activities. ICICI Bank has edged higher by 0.3% at Rs 1098 after raising its benchmark base by 25 basis points to 9.5% per year. The stock has thus gained for nine days at a stretch.
On the other hand, ITC has weakened by 0.9% at Rs 199 to emerge as the top loser on the BSE. Tata Steel has fallen by 0.8% after the stock turned ex-dividend for a dividend of Rs 12 a share for the year ended March 2011. NTPC, L&T and Hero Honda are the other significant losers.
The market breadth is positive. Out of 2882 stocks traded on the BSE, there are 1738 advancing stocks as against 1038 declines.
