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The benchmark indices have opened the week's proceedings on a firm footing despite the mixed set of cues from global front.
At 9:40am, the Sensex was at 27,455, higher by 132 points and the Nifty had reclaimed the 8,300 mark at 8,303, up 39 points.
The broader markets are also going strong, with the midcap gaining 0.5% at 10,622 and the smallcap index addding 0.4% at 11,093.
In news developments over the weekend, the finance ministry pegged the fiscal deficit for 2014-15 at 4% of the gross domestic product (GDP), reports suggest. The revised estimate presented in February had pegged it at 4.1%.
In the past week, the BSE Sensex had extended gains for the second straight week, gaining 219 points to end at 27,324 and the Nifty index had risen by 70 points to settle at 8,262.
Among key results, Asian Paints, Tata Power, Tata Steel, Bajaj Auto, Coal India, ITC and State Bank of India (SBI) are some of the companies that will announce their quarterly results this week.
EXPERT’S VIEW
Going ahead, remaining quarterly results, distribution of monsoon and pick-up in investment activity, if any, will dictate market sentiment and so will expectations of a US rate hike, analysts say.
“While the market has shown signs of stability on week-on-week basis, even as the intra-week volatility has been exceptionally high, it is yet early to assume that the short-term trend for the market has reversed for good. Thus, traders should continue to exercise caution and adopt disciplined trading actions. As for investors, there are stocks available across sectors at attractive medium-to-long-term valuation, which should be accumulated,” said Hitesh Agrawal, head research, at Reliance Securities in a note.
Technical chartists suggest that 8,360 barrier for the Nifty continues to appear stiff, which could mean that despite oscillators’ position being accommodative towards an upswing, the potential for a break past this barrier looks limited. Sustained inability to clear 8,360 would also suggest that the 7,800 could drag indices lower.
"Going forward, we maintain our higher degree negative stance on the market and expect the Nifty to face strong resistance around the 8350 - 8400 levels. Thus, traders should remain light on positions in the ongoing bounce and should look for a shorting opportunity if and when the Nifty reaches the above mentioned resistance zone," points out a morning note from Angel Broking.
"On the flipside, the immediate support for the index is seen around 8100 - 8000 levels. However, sooner or later, we expect the Nifty to slide below this support zone. It's advisable to trade cautiously in the market and we suggest avoiding trading aggressively in the opposite direction of the higher degree (down) trend," it adds.
GLOBAL MARKETS
Japan's Nikkei share average rose on Monday morning to a two-and-a-half-week high, bolstered by gains in the insurance sector after Dai-ichi Life announced higher shareholder payouts. The Nikkei 225 gained 0.5% to 19,828 after rising as high as 19,849, its highest level since April 30.
However, China’s stocks fell for a second day, led by commodity and financial companies, amid concern a flood of new share sales will lure funds from existing equities. The Shanghai Composite Index dropped 0.6% to 4,283.29, adding to Friday’s 1.6% decline. According to reports, 20 companies are scheduled to sell initial public offering (IPO) shares from Tuesday to Thursday, which may freeze 2.8 trillion yuan ($451.1 billion).
SECTORS AND STOCKS
On the stock-specific front, ONGC, GAIL and Tata Power have logged gains of 1-2% each to lead the BSE charts.
Coal India, Hindustan Unilever and Wipro have, however, edged lower in early trades.
On the sectoral front, all the BSE sectoral indices are in the green this morning. Ther oil index has jumped by around 1%, while the auto, pharma and banking indices have gained in the region of half a percent each.
The oil marketing companies such as Bharat Petroleum Corporation (BPCL), Indian Oil Corporation (IOC) and Hindustan Petroleum Corporation (HPCL) were trading higher by 2%-3% each on the back of fuel price hike. These three companies announced a Rs 3.13-a-litre increase in the retail price of petrol and Rs 2.71-a-litre rise in diesel prices with effect from Friday midnight to align the de-regulated domestic prices with the international rates. And index bellweather RIL has gained half a percent at Rs 879.
In the auto space, M&M and Tata Motors have gained around 1% each.
In the pharma space, Lupin, Dr Reddy's and Sun Pharma have added about 1% each.
In the banking space, ICICI Bank, HDFC Bank and SBI have added nearly 1% each; Yes Bank, Bank of Baroda and IndusInd Bank are also the other major gainers in the banking space.
The market breadth is strong. Out of 1,540 stocks traded on the BSE, there are 1,074 advancing stocks as against 406 declines.
