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Buoyancy in IT and Pharma stocks has kept volatitility at bay as benchmark indices remain flat in late morning trades. However, losses in ITC and ICICI capped upside gains.
At 11:30AM, Sensex is at 26,649 with a gain of 23 points while Nifty is trading at 7,969 with a gain of 0.15 points.
In the broader market, both BSE Mid Cap and Small Cap outperform the Sensex with gains of 0.8% and 1.6%.
Market breadth is positive with three gainers for every declining stock.
Despite the rally provided by the S&P rating upgrade, which analysts attribute to short-covering, FIIs remained net sellers, offloading shares worth 1,134 crores on Friday, 26 september, 2014.
Among other cues, along with the HSBC India Manufacturing PMI for September auto sales data is to be released on October 1. The latter will confirm whether the buying spree continues in the festive season.
Meanwhile, in truncated trading this week, caution is expected ahead of RBI policy review on Tuesday as analysts believe a rate cut will only come around April- June 2015.
However,experts have kept the long term outlook positive. According to ICICI Securities, market is fundamentally in a bull phase.
Rupee is trading at 61.47 against US Dollar. Boosted further by the upward revision of GDP estimates of the US by the Commerce Department on Friday which further reinforced the perception of US recovery being strongest in global market, US Dollar hit a four-year peak against a basket of currencies in early Asian trade on Monday.
Asian Markets
Political unrest in Hong Kong, worst since China's resumption of control over the island following transfer of power from the British two decades ago, unleashed volatility in the Asian markets.
Hang Seng has dropped 2%, lowest level in three months.
Buoyed by uptick in the US markets,Nikkei rose 0.4 %.
At present, mainland Chinese market remain relatively unscathed from the spillover effects of the Hong Kong unrest. Shanghai shares have risen 0.3%.
Strait Times index remains flat at 3,291.
Sectors and Stocks
BSE Health and BSE IT along with BSE Consumer Durables are the sector with biggest gains with advances in the range of 1-2%.
With weak Chinese data supressing metal prices BSE metal sector remains under pressure. Along with BSE Bankex, which is still feeling the lingering impacts of coal block verdict, it has lost around 1%.
Rally in pharma sector is particularly strong. Sun Pharma is the biggest gainer with a surge of 3.5% as apprehensions of an import alert on its Halol plant have largely diminished now.
Dr Reddys lab and Cipla each have gained around 1%.
Among other pharma players, Aurobindo Pharma has surged nearly 6.5% to Rs 938, also its record high on the BSE. The stock zoomed 17% in past three trading sessions from Rs 801 on September 24, after Medicines Patent Pool (MPP), an United Nations arm, has entered into sub-licencing agreement with the company for generic manufacturing a HIV drug tenofovir alafenamide for 112 developing countries.
Strides Arcolab too gained 4% to Rs 667 after the company said it intends to invest $20 million in Biotech business and after providing for taxes, the balance will be available for distribution to shareholders subject to the approval of Board of Directors.
In the IT sector after being awarded as the "Best Technology Provider" in the US by leading insurance publication "Reactions" on September, 26 2014, stocks of TCS have surged by 3% while strong showing by Infosys has continued as it is trading with a gain of 1.2%.
