The benchmark indices traded in a narrow range near the day's high in mid-morning trade. Sentiment got a boost following the government's decision to start a phased reopening of the economy. Strong cues from other Asian stocks also supported buying. Better-than-expected GDP numbers also lifted the investor mood.
At 11:28 IST, the barometer index, the S&P BSE Sensex, was up 978.23 points or 3.02% at 33,402.33. The Nifty 50 index was added 284.70 points or 2.97% at 9,865.
In the broader market, the S&P BSE Mid-Cap index was gained 2.21% while the S&P BSE Small-Cap index rose 3.01%.
The market breadth was strong. On the BSE, 1711 shares rose and 405 shares fell. A total of 118 shares were unchanged. In the Nifty 50 index, 44 shares advanced while 6 stocks declined.
Foreign portfolio investors (FPIs) bought shares worth Rs 1,460.71 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 967.43 crore in the Indian equity market on 29 May, provisional data showed.
Domestic macroeconomic data:
India's economy grew at 3.1% in Q4 March 2020. The gross domestic product (GDP) had expanded by 5.7% in the corresponding quarter of 2018-19, according to data released by the National Statistical Office (NSO). In 2019-20, the Indian economy grew by 4.2% against 6.1% expansion recorded in 2018-19. The government has also revised down the GDP growth in Q1, Q2, and Q3 to 5.2%, 4.4%, and 4.1% respectively.
Estimates will undergo revision as statutory data submission deadlines were extended by government in view of Covid-19 outbreak, Ministry of Statistics and Programme Implementation (MOSPI) said in a press note.
Meanwhile, the growth rate of Index of Eight Core Industries for April 2020 declined by 38.1% (provisional) compared to decline of 9% (provisional) in March 2020.
Economy Reopening:
Union Ministry of Home Affairs (MHA) has issued guidelines for a phased-wise reopening of the economy from 1 June 2020. The new rules allow religious places, shopping malls, hotels and restaurants to open from June 8. The government has decided to allow all activities prohibited earlier in areas outside containment zones in a phased manner.
Buzzing Index:
The Nifty Auto index added 3.30% to 6,424.20, advancing for ninth straight day. The index has added 18.3% in nine sessions.
Ashok Leyland (up 6.71%), TVS Motor Company (up 4.98%), Mahindra & Mahindra (up 4.73%), Eicher Motors (up 4.24%), Tata Motors (up 3.57%), Bajaj Auto (up 1.95%) and Hero MotoCorp (up 0.83%) edged higher.
Maruti Suzuki India rose 2.68% to Rs 5772.50. The company posted total sales of 18,539 units in May 2020 (including 13,865 units in domestic market and sales of 23 units to other OEM). Meanwhile, following resumption of port operations at the Mundra Port, the company exported 4,651 units in May as compared to 632 units exported in April.
Escorts gained 4.42% to Rs 943.95. The company's Agri Machinery Segment (EAM) sold a total of 6,594 tractors in May 2020, a decline of 3.4% as against 6,827 tractors sold in May 2019. Its domestic tractor sales in May 2020 stood at 6,454 tractors, registering a minor decline of 0.5% as against 6,488 units in May 2019. Exports in May 2020 stood at 140 tractors as against 339 tractors sold in May 2019, down 58.7% YoY.
Global Markets:
Shares in Asia neared their three-month highs on Monday as economies continue to progress on the reopening front. The gains were led by Chinese stocks after the data released over the weekend showed the country's factory activity expanding for third straight month.
China's National Bureau of Statistics said manufacturing activity in the country eased slightly, reporting official manufacturing PMI of 50.6 for the month of May, as compared to 50.8 in April. PMI readings above 50 indicate expansion, while those below that level signal contraction.
Meanwhile, the Caixin/Markit manufacturing PMI for May came in at 50.7 as compared to the April reading of 49.4.
Caixin and IHS Markit said, "May data signalled a further increase in output following February's record decline, with firms widely mentioning the resumption of works due to an easing of COVID-19 related measures."
The US equity market finished volatile session mostly higher on Friday, 29 May 2020, as traders seems relief after newly announced US policies to punish China did not threaten a trade detente between Washington and Beijing.
President Donald Trump lashed out at China in his brief remarks, but traders seemed relieved that he did not announce new tariffs or a withdrawal from the phase one trade agreement. Following China's recent move to approve a controversial security law for Hong Kong, Trump said he is directing his administration to remove special exemptions for the city. Trump argued Hong Kong is "no longer sufficiently autonomous" to warrant preferential treatment by the U.S., claiming China has abandoned the idea of "one country, two systems."
The president also announced that he is suspending the entry of certain foreign nationals from China into the U.S. as well as instructing a presidential working group on financial markets to study Chinese companies listed on U.S. exchanges.
The University of Michigan revised data showed consumer sentiment in the U.S. improved by slightly less initially estimated in the month of May. The report showed the consumer sentiment index for May was downwardly revised to 72.3 from the preliminary reading of 73.7.
The Commerce Department released a report unexpectedly showed personal income spiked by 10.5% in April after tumbling by a revised 2.2% in March. The Commerce Department said personal spending plummeted by 13.6% in April after a revised 6.9% slump in March.
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