Post Session: Quick Review

Extending their bull-run for third straight session, Indian equity markets recorded highest ever close in 2014, ending past the psychological 21,300 and 6,300 levels respectively, with gains of around half a percent on Wednesday. In the splendid session of trade, local bourses after getting an insipid start kept gyrating in narrow range, breaking out in green during the fag end of trade, when hectic buying activity took place. Gains of select blue-chip stocks, viz, Infosys, Reliance Industries and Sun Pharmaceuticals, combined with positive global set-up spelled optimism across the Dalal Street. Some good earnings from mortgage lender Housing Development Finance Corporation (HDFC), which posted in line with estimates 12 per cent gain in quarterly net profit, on the back of higher loan growth, buoyed the sentiment. Besides larger peers, broader indices too ended with gains of over two tenth of a percent.

On the global front, Asian share markets gained slightly on Wednesday, led by gains in Chinese shares after China's central bank poured funds into money markets, easing immediate credit strains ahead of the lunar New Year. Additionally, European equities were higher on Wednesday following a global growth upgrade from the International Monetary Fund (IMF) on Tuesday.

Closer home, while most of the sectoral indices on BSE ended in green, only FMCG and Capital Goods counters underperformed. On the flip side, Healthcare, Metal and Oil & Gas counters were the star performer of the session. Banking shares too managed to eke out decent gains of over quarter of a percent amid rising expectations that the Reserve Bank of India (RBI) will keep monetary policy unchanged next week. The sector stayed unaffected despite reports of central bank panel suggesting targeting Consumer Price Index (CPI), its main policy objective, which raises the prospects of a sustained period of high interest rates. Additionally, Fertilizer stocks, viz, Rashtriya Chemical Fertilizer (RCF), National Fertilizers and Chambal Fertilizers witnessed strong demand after reports suggested of Finance Minister releasing Rs 9000 crore worth of subsidies for the sector.

On the result front, Housing Development Finance Corporation (HDFC)’s net profit rose to Rs 1277.71 crore in the December quarter compared with Rs 1140.10 crore a year earlier. On the flip side, Q3 earnings of Dabur India and M&M Financial Service turned out to be disappointment. Ayurvedic and natural health care manufacturer Dabur India’s stock fell 4% after company reported 15.98% rise in its net profit at Rs 182.57 crore for December quarter as compared to Rs 157.42 crore for the same quarter in the previous year. Additionally, M&M Financial service too plummeted 4% after company reported 18.02% fall in its net profit at Rs 164.14 crore for the quarter as compared to Rs 200.23 crore in the corresponding quarter of the previous year. The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1389: 1284, while 162 scrips remained unchanged. (Provisional)

The BSE Sensex gained 68.23 points or 0.32% to settle at 21319.35. The index touched a high and a low of 21377.91 and 21168.43 respectively. Among the 30-share Sensex, 19 stocks gained, while 11 stocks declined. (Provisional)

The BSE Mid cap and Small cap indices ended higher by 0.08% and 0.25% respectively. (Provisional)

On the BSE Sectoral front, Healthcare up by 1.42%, Metal up by 0.96%, Oil & Gas up by 0.57%, Realty up by 0.35% and Teck up by 0.32% were the top gainers, while Capital Goods down by 0.33%, FMCG down by 0.22% and Consumer Durables down by 0.04% were the only losers in the space. (Provisional)

The top gainers on the Sensex were Sun Pharma up by 2.94%, Tata Steel up by 2.32%, Hindalco Industries up by 2.13%, Bharti Airtel up by 1.56% and NTPC up by 1.30%, while, SBI down by 1.01%, ITC down by 0.61%, Hero MotoCorp down by 0.60%, Axis Bank down by 0.51% and L&T down by 0.43% were the top losers in the index. (Provisional)

As per the International Monetary Fund (IMF), Indian economy is likely to grow at 4.6 percent in current financial year and the growth may improve to 5.4 percent by 2014-15. Presenting a sanguine picture of India's economic outlook, the IMF, in its World Economic Outlook update, has noted that growth in India has picked up after a favourable monsoon season and a higher export growth and is expected to grow further on strong structural policies supporting investment. Indian economic growth is likely to be at 6.4 percent in 2015-16, it added.

At present, Indian economy is struggling with all macro-economic indicators deteriorated. During April-September’ 2013-14, economic growth slipped to 4.6 percent from 5.3 percent in the same period last fiscal. Meanwhile, in the previous fiscal, India's economy slowed to a decade low of 5 percent owing to the global slowdown and domestic factors, like high interest rates. Further, India’s annual industrial (IIP) output growth contracted by 0.2% during the period April-November’ 2013-14 over the corresponding period of previous year.

Referring to the global economy’s growth, IMF reported that global activity strengthened during the second half of 2013 and is expected to improve further in 2014-15, largely on account of recovery in the advanced economies. IMF has projected global growth at around 3.7 percent in 2014 and 3.9 percent in 2015.

India VIX, a gauge for markets short term expectation of marginally gained 1.92% at 15.85 from its previous close of 15.55 on Tuesday. (Provisional)

The CNX Nifty gained 19.80 points or 0.31% to settle at 6,333.60. The index touched high and low of 6,349.95 and 6,287.45 respectively. Out of the 50 stocks on the Nifty, 32 ended in the green, while 18 ended in the red.

The major gainers of the Nifty were Sun Pharmaceuticals up 3.17%, BPCL up by 2.55%, Tata Steel up by 2.41%, Lupin up by 2.31% and Hindalco up by 2.08%. The key losers were Asian Paints down by 0.93%, SBI down by 0.92%, ACC down by 0.79%, ITC down by 0.77% and Cairn down by 0.71%. (Provisional)

Most of the European markets were trading in red; Germany’s DAX down by 0.14% and UK’s FTSE 100 down by 0.03%, while France’s CAC 40 was up 0.13%.

The Asian markets barring KLSE Composite and Straits Times, concluded Wednesday’s trade in green while Hong Kong and Shanghai posted good gains, extending their upmove from the previous session after China’s central bank injected fresh capital into financial markets to avert a cash crunch. The Thai government declared a state of emergency in its capital in response to anti government protests that have paralyzed the city and stirred up increasingly violent attacks. Investment in Indonesia reached a record high in 2013, exceeding the government’s own target but the pace of growth is likely to slow down this year amid a tighter monetary policy. Separately, the International Monetary Fund raised its global growth forecast for the first time in nearly two years amid rising demand and inventories in advanced economies, which picked up the mantle of growth from emerging markets. The IMF predicted 3.7 % global economic growth this year, 0.1% point higher than its October projections, and sees growth of 3.9% in 2015.

Japan’s All Industries Activity Index rose to a seasonally adjusted 0.3%, from -0.2% in the preceding month. The Bank of Japan left its economic views unchanged while also keeping its policy interest rate and asset-purchase program steady, as widely expected. Some of the numerical forecasts were tweaked slightly, with the policy board now indicating a median economic growth forecast of 1.4% for fiscal 2014, compared to October’s median projection of 1.5%.