Key benchmark indices extended initial gains to hit fresh intraday high in morning trade as firm Asian stocks boosted sentiment. Comments from the Reserve Bank of India Governor D Subbarao on Tuesday that the central bank will take note of falling inflation when discussing potential interest rate cuts also buoyed sentiment. The barometer index, the S&P BSE Sensex, regained the psychological 20,000 mark. The 50-unit CNX Nifty regained the psychological 6,000 level. The Sensex was up 291.48 points or 1.48%, up close to 215 points from the day's low. The market breadth, indicating the overall health of the market, was quite strong.
Index heavyweights ITC and Reliance Industries (RIL), both, extended initial gains. Auto stocks rose as the latest data showing a sharp fall in wholesale price inflation in April 2013 raised hopes that the RBI may further cut policy rates to perk up economic growth. Among telecom stocks, Reliance Communications hit 52-week high. In media stocks, Zee Entertainment Industries hit 52-week high.
Gains in Asian stocks triggered a firm opening on the domestic bourses. The market extended initial gains to hit fresh intraday high in morning trade.
The market sentiment was boosted by data showing that foreign funds remained net buyers of Indian stocks on Tuesday, 14 May 2013. Foreign institutional investors (FIIs) bought shares worth a net Rs 420.99 crore on Tuesday, 14 May 2013, as per provisional data from the stock exchanges.
At 10:20 IST, the S&P BSE Sensex was up 291.48 points or 1.48% to 20,013.77. The index jumped 292.75 points at the day's high of 20,015.04 in morning trade, its highest level since 13 May 2013. The index gained 75.89 points at the day's low of 19,798.18 in opening trade.
The CNX Nifty was up 86.35 points or 1.44% to 6,081.75. The index hit a high of 6,081.85 in intraday trade, its highest level since 13 May 2013. The index hit a low of 6,018.85 in intraday trade.
The market breadth, indicating the overall health of the market, was quite strong. On BSE, 1,168 shares advanced and 304 shares declined. A total of 61 shares were unchanged.
Among the 30-share Sensex pack, 28 stocks rose while only two of them fell. HDFC, State Bank of India (SBI) and HDFC Bank rose by 2.14% to 3.33%.
Index heavyweight Reliance Industries (RIL) gained 1.52% to Rs 809.80. The stock hit a high of Rs 809.90 and low of Rs 802.35 so far during the day.
Index heavyweight and cigarette major ITC rose 0.92% to Rs 339. The stock hit a high of Rs 339.50 and low of Rs 336 so far during the day. The stock had hit record high of Rs 355 in intraday trade during the special trading session held on Saturday, 11 May 2013. The Centre raised the excise duty on cigarettes by about 18% on all cigarettes except cigarettes of length not exceeding 65 mm in Union Budget 2013-14.
Auto stocks rose as the latest data showing a sharp fall in wholesale price inflation in April 2013 raised hopes that the RBI may further cut policy rates to perk up economic growth. Lower interest rates may help revive demand for vehicles. Purchases of automobiles, including that of cars, utility vehicles and commercial vehicles are substantially driven by financing.
Mahindra & Mahindra (M&M) gained 1.57%. The company announced on 10 May 2103, the launch of a new H-Series Xylo, powered by the refined and world class mHawk engine. The new H-Series starts at an attractive price of Rs 8.23 lakh (ex showroom Mumbai, BSIV variant).
India's largest car maker by sales, Maruti Suzuki India rose 1.25% to Rs 1,725. The stock had hit record of Rs 1,742 in intraday trade on Monday, 13 May 2013.
India's largest commercial vehicle maker by sales, Tata Motors, gained 1.93%. The company's total sales fell 15% to 51,160 in April 2013 over April 2012. Total domestic sales fell 17% to 47,595 in April 2013 over April 2012. Exports rose 28% to 3,565 during the period. The company announced the monthly sales data on 1 May 2013.
Two wheeler markers also gained. Bajaj Auto rose 1.08%. The company announces Q4 results tomorrow, 16 May 2013. The company's total sales fell 10% to 3.44 lakh units in April 2013 over April 2012. Motorcycle sales fell 12% to 3 lakh units in April 2013 over April 2012. Commercial vehicle sales rose 10% to 43,351 units in April 2013 over April 2012. Exports fell 23% to 1.30 lakh units in April 2013 over April 2012. The company announced the sales figures on 2 May 2013.
India's largest motorcycle maker by sales, Hero MotoCorp gained 1.5%. The company said on 1 May 2013 its total sales fell 9.5% to 4.99 lakh in April 2013 over April 2012.
Reliance Communications rose 2.46% to Rs 114.60. The stock hit 52-week high of Rs 115.10 in intraday trade today, 15 May 2013.
Zee Entertainment Industries rose 1.31% to Rs 251. The stock hit 52-week high of Rs 252.20 in intraday trade today, 15 May 2013.
The focus of the market is on Q4 results. Bajaj Auto announces Q4 results tomorrow, 16 May 2013. ITC unveils Q4 results on Friday, 17 May 2013. Coal India unveils standalone FY 2013 results on 20 May 2013. L&T unveils Q4 results on 22 May 2013. Tata Steel, State Bank of India and Bharat Heavy Electricals (Bhel) unveil Q4 results on 23 May 2013. Coal India unveils consolidated FY 2013 results on 27 May 2013. Sun Pharma, GAIL (India) and Hindalco Industries unveil Q4 results on 28 May 2013. ONGC, NMDC and BPCL unveil Q4 results on 29 May 2013. M&M and Tata Power unveil Q4 results on 30 May 2013.
The annual rate of inflation, based on monthly wholesale price index (WPI), eased sharply to 4.89% in April 2013, from 5.96% in March 2013, data released by the government on Tuesday, 14 May 2013, showed. Core inflation or non-food manufacturing inflation declined further to 2.74% in April 2013 from 3.41% in March 2013.
Meanwhile, WPI inflation for February 2013 was revised upwards to 7.28% from 6.84% reported earlier.
The consumer price inflation fell below the 10% mark in April 2013. The combined consumer price inflation for rural and urban India eased to 9.39% in April 2013 from 10.39% in March 2013, data released by the government on Monday, 13 May 2013, showed.
India's trade deficit widened to $17.787 billion in April 2013 from $14.041 billion in April 2012, data released by the government on Monday, 13 May 2013, showed. While exports rose 1.68% at $24.164 billion, imports jumped 10.96% to $41.951 billion in April 2013 over April 2012.
Industrial production rose 2.5% in March 2013, compared with a revised growth of 0.46% in February 2013, data released by the government on 10 May 2013, showed. Industrial production rose 1% for the year ended 31 March 2013 (FY 2013).
The RBI on 3 May 2013 cut its key policy rate viz. the repo rate by 25 basis points (bps) to 7.25% and kept the cash reserve ratio (CRR) for banks unchanged at 4% after a monetary policy review. RBI said that the balance of risks stemming from its assessment of the growth-inflation dynamic provides little space for further monetary easing. The central bank said that with upside risks to inflation still significant in the near term in view of sectoral demand supply imbalances, ongoing correction in administered prices and pressures stemming from MSP increases, monetary policy cannot afford to lower its guard against the possibility of resurgence of inflation pressures. The RBI said it will endeavour to condition the evolution of inflation to a level of 5% by March 2014, using all instruments at its command.
The finance ministry in October 2012 announced a five-year plan to cut fiscal deficit. The government hopes to reduce the fiscal deficit to 3% by March 2017.
Asian shares rose on Wednesday, with Japan's Nikkei Average surging to a fresh 5-1/2 year high on the back of a weaker yen and strengthening expectations for earnings growth for Japanese firms. Key benchmark indices in Indonesia, Japan, Hong Kong, Taiwan, and Singapore rose by 0.16% to 1.84%. Key benchmark indices in China and South Korea fell by 0.08% to 0.11%.
Trading in US index futures indicated a flat opening of US stocks on Wednesday, 15 May 2013. US stocks rallied to record highs on Tuesday, continuing an ascent driven by the Federal Reserve's easy monetary policy, though investors' focus has turned to when the Fed may start to rein in its bond-purchase programme.
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