Firmness persisted on the bourses as the key benchmark indices held firm in early afternoon trade after hitting fresh intraday high. At 12:21 IST, the barometer index, the S&P BSE Sensex was up 309.89 points or 1.09% at 28,842. The Nifty 50 index was currently up 94.30 points or 1.07% at 8,903.95. Positive Asian stocks underpinned sentiment. The latest rally on the bourses was triggered by outcome of a monthly survey showing that August saw a solid rebound in the rate of expansion in Indian service sector business activity also boosted sentiment.
Domestic stocks saw a gap-up opening, as trading resumed after a local holiday yesterday, 5 September 2016. The Sensex hit its highest level in over 16-1/2 months. The Nifty hit 18-month high. The Sensex jumped 312.91 points or 1.1% at the day's high of 28,845.02 in early afternoon trade, its highest level since 16 April 2015. The barometer index rose 99.16 points or 0.35% at the day's low of 28,631.27 in opening trade. The Nifty surged 95.45 points or 1.08% at the day's high of 8,905.10 in early afternoon trade, its highest level since 5 March 2015. The index rose 38.80 points or 0.44% at the day's low of 8,848.45 in early trade.
In overseas stock markets, Asian shares were trading higher as prospects for a US interest-rate increase this month remained subdued. US markets were closed yesterday, 5 September 2016 for Labour Day holiday. Meanwhile, the Group of 20 major economies (G20) wrapped up their annual summit, held in Hangzhou, China, yesterday, 5 September 2016 with a stronger commitment to coordinate policies to support growth and promote trade liberalization.
Closer home, the market breadth indicating the overall health of the market was strong. On BSE, 1,592 shares rose and 864 shares declined. A total of 156 shares were unchanged. The BSE Mid-Cap index was currently up 1.39%, outperforming the Sensex. The BSE Small-Cap index was currently up 0.88%, underperforming the Sensex.
Cement stocks rose. Ambuja Cements (up 0.38%), ACC (up 1.91%) and Shree Cement (up 4.04%) gained. UltraTech Cement shed 0.38%.
Grasim Industries was up 2.55% at Rs 4,730.95. Grasim has exposure to the cement sector through its holding in UltraTech Cement.
Capital goods gained. Index heavyweight and engineering and construction major L&T advanced 0.77% to Rs 1,513.95. The stock hit high of Rs 1,523.50 and low of Rs 1,510 so far during the day.
Punj Lloyd (up 3.12%), ABB India (up 0.77%), Bharat Heavy Electricals (Bhel) (up 0.88%), Bharat Electronics (up 0.26%), Crompton Greaves (up 1.16%), Siemens (up 1.12%) and Thermax (up 0.06%) gained. BEML slipped 0.26%.
Petronet LNG rose 0.67% after net profit surged 54.78% to Rs 377.86 crore on 36.28% decline in net total income from operations to Rs 5337.31 crore in Q1 June 2016 over Q1 June 2015. The result was announced yesterday, 5 September 2016, during which the stock market was closed on account of Ganesh Chaturthi.
Ahluwalia Contracts (India) rose 7.57% after the company said it secured new orders worth of approximately Rs 244.13 crore. Ahluwalia Contracts (India) said the new orders are for construction of hospital building, including electrical, plumbing and firefighting services for Chittaranjan National Cancer Institute at Kolkata. The total order inflow during the financial year ending March 2017 stands at Rs 1209.59 crore. The announcement was made during trading hours today, 6 September 2016.
Pennar Engineered Building Systems rose 6.83% after the company said it bagged multiple orders worth total Rs 203 crore. The announcement was made during trading hours today, 6 September 2016.
Meanwhile, Urjit Patel assumed charge as the 24th governor of Reserve Bank of India (RBI), succeeding Raghuram Rajan whose three-year controversy-ridden tenure ended on Sunday, 4 September 2016. Patel has assumed charge effective from Sunday after serving as deputy governor since January 2013, RBI said.
On the macro front, the outcome of a monthly survey showed that August saw a solid rebound in the rate of expansion in Indian service sector business activity. Data released yesterday, 5 September 2016 showed that the seasonally adjusted Nikkei India Services Business Activity Index rose to 54.7 in August, up from 51.9 in July, posting its highest level for over three-and-a-half years. The headline index has now signalled expansion in each of the past 14 months. With growth of manufacturing production also ticking higher, the seasonally adjusted Nikkei India Composite PMI Output Index climbed to a 42-month high of 54.6 in August, from 52.4 in July highlighting a stronger improvement in private sector economic activity.
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