Key benchmark indices extended initial gains to hit fresh intraday high in morning trade as firm Asian stocks underpinned sentiment. The S&P BSE Sensex and the 50-unit CNX Nifty, both, hit their highest level in over one week. The Sensex was up 180.50 points or 0.97%, off about 30 points from the day's low and up close to 100 points from the day's high. The market breadth, indicating the overall health of the market, was strong. All the thirteen sectoral indices on BSE were in the green. Capital goods stocks gained. Realty stocks also rose. Asian stocks rose for a second day on Monday after a slump in US home sales eased speculation the Federal Reserve will reduce economic stimulus next month.
The market edged higher in early trade triggered by firm Asian stocks. It extended initial gains to hit fresh intraday high in morning trade.
The market may remain volatile this week as traders roll over positions in the futures & options (F&O) segment from the near month August 2013 series to September 2013 series. The near month August 2013 derivatives contract expire on Thursday, 29 August 2013.
At 10:20 IST, the S&P BSE Sensex was up 180.50 points or 0.97% to 18.699.94. The index rose 208.75 points at the day's high of 18,728.19 in morning trade, its highest level since 16 August 2013. The index gained 83.12 points at the day's low of 18,602.56 in early trade.
The CNX Nifty was up 44.90 points or 0.82% to 5,518.65. The index hit a high of 5,528.70 in intraday trade, its highest level since 16 August 2013. The index hit a low of 5,496.20 in intraday trade.
The market breadth, indicating the overall health of the market, was strong. On BSE, 855 shares rose and 266 shares fell. A total of 57 shares were unchanged.
Among the 30-share Sensex pack, 24 stocks rose and rest of them fell. Sterlite Industries (up 3.59%), Wipro (up 3.2%) and Tata Power Company (up 3.2%), edged higher.
Capital goods stocks gained. L&T rose 2.21%. The company on 22 August 2013, announced that its construction division has won new orders valued at Rs 1504 crore across various business segments in August 2013.
Shares of power equipment major Bharat Heavy Electricals (Bhel) rose 2.63%, with the stock extending Friday's 8.1% jump.
Realty stocks also rose. DLF (up 0.4%), HDIL (up 3.76%), Unitech (up 2.69%) and D B Realty (up 1.44%), gained.
Asian stocks rose for a second day on Monday after a slump in US home sales eased speculation the Federal Reserve will reduce economic stimulus next month. Key benchmark indices in Singapore, Hong Kong, China, Japan, Taiwan and South Korea were up by 0.13% to 1.41% Indonesia's Jakarta Composite fell 0.17%.
Trading in US index futures indicated that the Dow could gain 37 points at the opening bell on Monday, 26 August 2013. US stocks rose on Friday, 23 August 2013 as investors watched Federal Reserve officials for signals on stimulus cuts after data showed home sales plunged. Data from the Commerce Department showed purchases of new US homes plunged in July by the most in more than three years and previous months were revised down, a sign that growth in the industry may be taking a pause as mortgage rates rise.
Federal Reserve officials rebuffed international calls to take the threat of fallout in emerging markets into account when tapering US monetary stimulus. The risk that the Fed's trimming of bond buying will hurt economies from India to Turkey by sparking an exodus of cash and higher borrowing costs was a dominant theme at the annual meeting of central bankers and economists in Jackson Hole, Wyoming, that ended 24 August 2013.
The US central bank currently buys $85 billion a month in US debt and mortgage-backed securities in a bid to hold interest rates low and encourage economic growth. Federal Reserve Chairman Ben Bernanke has on several occasions stressed that the tapering process is dependent on an improvement in data. Fed's bond-buying program has kept global markets flush with liquidity in recent years.
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