A range bound movement was witnessed as key benchmark indices hovered close to their intraday high in early afternoon trade. At 12:20 IST, the barometer index, the S&P BSE Sensex, was up 406.58 points or 1.62% at 25,552.17. The Nifty 50 index was currently up 121.35 points or 1.57% at 7,830.30. A confluence of positive factors viz. forecast of good rains during the June-September 2016 southwest season, further easing of consumer price inflation raising hopes of further rate cut from the Reserve Bank of India, rebound in industrial production and gains in global stocks aided the latest rally on the domestic bourses.
The Sensex jumped 433.58 points or 1.72% at the day's high of 25,579.17 in mid-morning trade, its highest level since 6 January 2016. The barometer index gained 212.83 points or 0.84% at the day's low of 25,358.42 in early trade. The Nifty rose 134 points or 1.73% at the day's high of 7,842.95 in mid-morning trade, its highest level since 4 January 2016. The index rose 63.25 points or 0.82% at the day's low of 7,772.20 in early trade.
The broad market depicted strength. There were more than two gainers against every loser on BSE. 1,682 shares rose and 728 shares fell. A total of 122 shares were unchanged. The BSE Mid-Cap index was currently up 1.28%. The BSE Small-Cap index was currently up 1.34%. Both these indices underperformed the Sensex.
In overseas stock markets, Asian stocks gained as rising crude prices buoyed energy producers and a weaker Japanese currency boosted shares in Tokyo. In Japan, the Nikkei 225 Average settled 2.84% higher. Chinese stocks edged higher after trade data showed stronger-than-expected rise in exports in March. In mainland China, the Shanghai Composite was currently up 1.77%. In Hong Kong, the Hang Seng index was currently up 2.46%. Chinese exports expanded in March for the first time in nine months, the latest data showed. Exports rose 11.5% in March year-over-year in dollar terms. Imports declined 7.6%, compared with February's 13.8% drop.
US stocks gained yesterday, 12 April 2016, led by energy companies after news reports said Saudi Arabia and Russia were working toward an agreement to cut oil production. The world's major crude oil producers led by Russia and Saudi Arabia have convened a meeting on Sunday, 17 April 2016, in Doha, Qatar to discuss measures to stabilise prices, including a proposal to freeze output. Iran has ruled out freezing output until its production recovers to pre-sanction levels.
Cement stocks edged higher on renewed buying. ACC (up 1.38%), Ambuja Cements (up 2.82%), Shree Cement (up 0.78%) and UltraTech Cement (up 4.16%) gained.
Grasim Industries rose 1.38%. Grasim has exposure to the cement sector through its holding in UltraTech Cement.
Telecom stocks edged higher. Bharti Airtel (up 1.96%), Reliance Communications (RCom) (up 0.87%), Tata Teleservices (Maharashtra) (up 1.51%) and Idea Cellular (up 1.15%) gained.
Maruti Suzuki India extended gains registered during the previous trading session as the Japanese yen weakened against the dollar. The stock was currently up 2.02%. The Maruti stock had tumbled recently after the yen strengthened against the dollar. A strong yen adversely impacts Maruti's operating profit margin.
IndusInd Bank rose 1.06%. The bank during market hours today, 13 April 2016, announced that it has inaugurated a new branch at Jajodia Complex, Lahkothi, Ratu Road, Ranchi, Jharkhand. The bank has plans to further strengthen its presence and customer reach in Jharkhand with more launches in the coming quarters.
Lux Industries gained 2.48% after the company's board of directors at its meeting held yesterday, 12 April 2016, approved a 5-for-1 stock-split proposal. The announcement was made after market hours yesterday, 12 April 2016.
The India Meteorological Department (IMD) said in its initial monsoon forecast that the southwest monsoon is likely to be 106% of the Long Period Average (LPA) during the four-month period from June to September 2016, with an error margin of plus/minus 5%. According to the weather office, there is 34% probability of above normal rains, 30% probability of excess rains, 30% probability of normal rains, 5% probability of below normal rains and 1% probability of deficient rains. The IMD's announcement hit the market after trading hours yesterday, 12 April 2016.
As the sea surface temperature conditions over the Pacific and Indian Oceans, particularly the ENSO conditions over the Pacific (El Nino or La Nina) are known to have strong influence on the Indian summer monsoon, IMD is carefully monitoring the sea surface conditions over the Pacific and the Indian oceans. The latest forecast from the Monsoon Mission Coupled Climate Model points to El Nino conditions weakening to moderate to weak levels during the first half of the monsoon season and ENSO neutral conditions likely to get established thereafter, the weather office said in a statement.
The IMD will issue an updated monsoon forecast in June 2016 as a part of the second stage forecast. Along with the updated forecast, the IMD will issue separate forecasts for rainfall in July and August and the distribution of rainfall over the four geographical regions of India.
On the macro front, the latest data showed that inflation based on consumer price index (CPI) dipped to six-month low of 4.83% in March 2016, with the index easing for second straight month. The CPI inflation for February 2016 was revised slightly upward to 5.26% from the provisional figure of 5.18% reported earlier. The core CPI inflation fell to 4.54% in March 2016 from 4.79% in February 2016.
Another data showed that industrial production rose 2% in February 2016 over February 2015, snapping consistent decline for last three straight months. The mining output posted healthy 5% growth, while electricity generation improved 9.6% contributing to the overall growth in industrial output in February 2016. The output of the manufacturing sector improved 0.7% in February 2016. Both the CPI and industrial production data were announced after market hours yesterday, 12 April 2016.
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