Dalal St ends strong on hopes of QE3 stimulus

Stocks across the globe got a fillip in trade today after weaker than expected Q1 economic growth in the US raised expectations of another round of stimulus from the Federal Reserve. 

Turnover was relatively weak as major participants opted to sit on the sidelines on lack of trading cues from China and Japan. European stocks rose on Monday as Spain reported its economy shrank less than the previous estimate in the first quarter.

A number of key regional bourses will be shut tomorrow for Labor Day/May Day holidays. This includes India, China, Hong Kong, Malaysia, Philippines, Singapore, South Korea, Taiwan, Thailand and Vietnam. The Japanese share markets will be closed on Thursday and Friday.

The Sensex shuts shop at 17318.81 up 131.47 points or 0.76% and the Nifty ends at 5248.15 up 39.15 points or 0.75%. The breadthe of the market was encouraging. About 1487 shares advanced, 1261 shares declined, and 671 shares remain unchanged.

The rally was led by gains in software services exporters on hopes of more stimulus from the Federal Reserve after data showed cooling US growth, making valuations in the sector more attractive after recent falls. Infosys rose 2.63%, while TCS ended 4% higher.

Realty stocks ended with decent gains on short covering.

Index heavyweights HUL, Hero Motocorp, Bharti Airtel, Bank Of Baroda and Corporation Bank are slated to announce quartrely results this week which could influence the market trend. Apart from the quarterly results, Production data of core sector for the month of March is also due this week, which may influence the short term trend of the market.

Top gainers on the Nifty: TCS, Jindal Steel, Infosys, Reliance Infra and ACC up 3-4%.

Top losers on the Nifty: BHEL, Maruti Suzuki, Axis Bank, Dr Reddys Labs and SAIL down 1-2%.

Stocks in News

Credit rating agency Moody's Investors Service placed ICICI Bank, HDFC Bank and Axis Bank on review for possible downgrades. ICICI Bank closed in green, up 1.55% whereas HDFC Bank and Axis Bank were down 0.18% and 1.34% respectively.

PSU major BHEL hits record low after the Rajasthan Government scrapped tenders worth Rs 12000 crore bagged by the company.  The government cancelled orders without specifying any particular reason.

Essar Oil surged 3% after the company announced renewal of a major product sale and purchase agreement with Bharat Petroleum Corporation last week.

Results Corner

Bank of India (4.55%), Vijaya bank (3.52%), Godrej Consumes (2.44%), Kesoram Industries (10%) etc soared on the back of strong quarterly numbers announced today while Oriental Bank of Commerce tanked 4% on poor earnings.

Turnover

Turnover was on the lower side as mentioned earler. The total turnover was less than Rs 1 lakh crore (Rs 99292.22 crore). Break-up: NSE Cash Rs 8845.87 Cr, NSE F&O Rs 66255.8 Cr, BSE F&O Rs 22518.99 Cr, BSE Cash Rs 1671.6 Cr.

Auto Stocks on Radar

Auto stocks will remain on traders radar on Wednesday. Major companies will announce their monthly sales numbers tomorrow.

Investors will closely monitor India Inc's Q4 March 2012 and FY 2012 results. Importantly, focus will be on the guidance provided by the company’s management for FY13 to gauge the earnings outlook.