 "Nifty opens above 7,050 on strong global cues")
Benchmark indices continue to race ahead with full force on the back of beaten down stocks amid strength in Asian equities.
At 10:35 am, the S&P BSE Sensex was at 23,367, up by 481 points while the Nifty50 was at 7,138, up by 157 points.
Markets seem to have shrugged off the contraction in December IIP numbers and the rise in January CPI data.
Shares of state-owned oil marketing companies (OMCs) – Hindustan Petroleum Corporation (HPCL), Bharat Petroleum Corporation (BPCL) and Indian Oil Corporation (IOC) – have rallied by up to 10% on the BSE in early morning trade after these companies reported a strong set of numbers for the quarter ended December 31, 2015 (Q3FY16).
Financial Technologies (India) Limited (FTIL) has slipped 16% to Rs 76.70, its lowest level since November 2004 on the BSE in early morning trade after the government ordered the merger of crisis-hit National Spot Exchange Ltd (NSEL) with the company.
The top gainers on the Sensex Tata Steel, Adani Ports, SBI, L&T, and Lupin, all up between 4% and 9% each.
The sole loser on the Sensex is Bharti Airtel, down by 1%.
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(updated 9:30 am)
Markets started the week on a firm note mirroring strength in Asian peers led by Japan. However, investors are likely to remain cautious and react to the macro-economic data released by the government post market hours on Friday.
At 9:30 am, the S&P BSE Sensex was at 23,370, up by 384 points while the Nifty50 was at 7,108, up by 127 points.
According to Angel Broking’s morning note, “Goingforward, 6870 (April 25, 2014 high as well as the Weekly‘200 SMA’ level) and 6790 (50% retracement level of the large up move from 4531.15 to 9119.20 and ’20 EMA’ on the quarterly chart) levels should render strong support to the Nifty.”
Further, “On the upside, 7,150 – 7,200 are now being seen as strong hurdles for the index in the forthcoming week. Thus, we need to closely observe if the Nifty is able to approach the above mentioned resistance zone. Traders are advised to stay light on positions and keep monitoring above mentioned key levels.”
The government released December IIP numbers and January CPI numbers on Friday. The data released revealed that factory output shrunk for the second straight month in December to 1.3%. The consumer price inflation edged up to a 17-month high of 5.69 per cent in January, driven up by higher food costs.
Meanwhile, all eyes would be on the WPI inflation numbers, which will be released later today.
On the currency front, the rupee has opened marginally stronger at 68.19 against the greenback, appreciating by 4 paise.
GLOBAL MARKETS
Most Asian markets resumed trading today post the Lunar Year holidays. Meanwhile, shares in China opened lower with the benchmark Shanghai Composite was down 1.7%. Data released showed that the Chinese imports contracted to 14.4% while the exports shrunk 6.6% in January.
However, shares in Japan rebounded today after sharp losses in the previous week. Japan’s economy shrank more than expected in the final quarter of last year by 1.4% thus raising hopes of more stimulus by the policymakers. The Nikkei was up 4.9% while Hang Seng rose 2% and Straits Times ended up 1.8%.
US stocks ended higher on Friday with the S&P 500 ending a five-day losing streak with rebound in energy and financial shares leading the gains. The Dow Jones industrial average ended up 2% at 15,974, the S&P 500 gained nearly 2% to close at 1,865 and the Nasdaq Composite ended 1.7% higher at 4,337.51.
SECTORS & STOCKS
Sectorally, BSE Metal is leading the rally, up by 4% followed by rate-sensitive sectors- BSE Bankex, Realty, and Auto indices up between 2% and 2.5% each. BSE Oil&Gas index has also gained over 2%
Individually, out of 30 stocks from the Sensex pack, 29 are trading in green with an exception of Bharti Airtel.
Tata Steel has emerged as the top gainer, up by 6% after the company said it plans to invest about Rs 2,000-2,500 crore for development of infrastructure at Gopalpur in Odisha in the near term.
The banking and financial pack is rallying in the morning trade after finance minister Arun Jaitely said the government would reduce its stake in public sector banks (PSBs) to 52 per cent.
Axis Bank has gained 3.3% on report that it is planning to raise $500 million (approximately Rs 3,350 crore) through Tier-II capital bonds to shore up its capital base. Its peers ICICI Bank, SBI, HDFC Bank have all gained between 0.5% and 2.5% each.
Bank of Baroda saw a massive buying, up by 11% after the management said that all non-performing assets were accounted for and it could return to profitability next fiscal.
Oil marketing companies are trading firm on the back of encouraging third quarter earnings. HPCL, BPCL, IOC have all gained strength between 4% and 8% each.
Sun Pharma has advanced 1.5% after higher ‘other income’, lower tax outgo, and improved performance of its US subsidiary Taro helped Sun Pharmaceutical post over three times growth in net profit in Q3FY16. Net profit rose to Rs 1,416 crore from Rs 395 crore in same period last year.
Diversified group ITC is looking to invest Rs 800 crore in Odisha over the next few years to set up a hotel property and a food processing park in the state. The stock has jumped nearly 2%.
