Indian equity benchmarks gained one percent on Thursday ahead of Infosys earnings & industrial output data tomorrow, and on hopes of more reforms following clearance to direct transfer of urea subsidy.
The 30-share BSE Sensex rose 173.65 points to close at 18,804.75, supported majorly by FMCG, banking & financials, oil & gas, capital goods and metals stocks.
Infosys rallied as much as 2.9 percent intraday ahead of September quarter earnings that are scheduled for tomorrow morning . The stock closes 1 percent up. Investors have been eagerly waiting for the results after that had been disappointed in the last three quarters.
Experts feel it would be a non-event for the market tomorrow. But if software bellwether delivers over 4 percent growth in profit and dollar revenues then there may be somewhat upmove. However, the growth at sub 3 percent will be bad for the stock, say experts.
Meanwhile, the 50-share NSE Nifty advanced 55.90 points to close above the 5700 level at 5,708.05.
The steady inflow of foreign money in October (especially after unlimited bond buying plans by Federal Reserve and European Central Bank last month) also improved sentiment despite 400 points correction on the Sensex in last three out of four sessions. Foreign institutional investors have bought Rs 8,000 crore worth of equity shares consistently since the start of October.
Experts said the correction was in the wake of profit booking after the Nifty hit 5800 level and Sensex touched 19000 level last week.
The Indian rupee too rebounded quite nicely, rising 33 paise to 52.71 against the US dollar (at 15:30 hours IST) after the Finance Minister P Chidambaram says there is no serious threat of a ratings downgrade. The rating agency Standard & Poor's has warned yesterday about a significant chance of cutting India's credit rating in the future.
Chidambaram says they have been taking threat of ratings downgrade seriously. "Many reforms can be implemented over 1.5 years."
Today the Cabinet has given approval to direct transfer of urea subsidy, which led fertiliser stocks 3-4 percent higher.
Sugar stocks too gained between 2 percent and 4 percent as the Rangarajan Committee, set up by the prime minister's office (PMO), is going to submit sugar decontrol report to Prime Minister tomorrow.
On the economic front, industrial output data will be announced tomorrow and the inflation on Monday. The index of industrial production (IIP), which measures output at factories, mines and utilities in India, likely inched up a median 1.1 percent year-on-year in August, after posting a negligible 0.1 percent growth in July, a Reuters poll showed.
Engineering conglomerate Larsen & Toubro and power equipment maker BHEL gained 2-2.6 percent.
Country's largest lender State Bank of India was up 1.9 percent while its rival HDFC Bank rose 1 percent.
Steel producer Tata Steel, commercial vehicle maker Tata Motors and telecom operator Bharti Airtel rallied 2 percent each.
Cigarette major ITC and housing finance company HDFC went up 0.9 percent. FMCG major Hindustan Unilever and oil & gas producer ONGC were up 1 percent.
Private sector lender ICICI Bank and index heavyweight Reliance Industries gained 0.4 percent.
Drug producer Cipla lost 2 percent. Software services exporter Wipro and top car maker Maruti Suzuki were down 0.6 percent each.
The BSE Midcap Index outperformed benchmarks, rising 1.16 percent while Smallcap Index moved up 0.84 percent.
Advancing shares outnumbered declining by a ratio of 1617 to 1162 on the BSE.
In the second line shares, Unitech shot up 17.5 percent after the company decided to exit telecom business and concentrate on realty business.
Indiabulls Real, HDIL, Punj Lloyd and NCC bounced back with 3-6 percent gains.
Sintex Industries gained 5% on second quarter results. Kingfisher surged 5 percent after three percent equity changed hands via block deal.
On the global front, European markets edged higher despite worries about Spain’s economy after ratings agency Standard & Poor's downgraded the country's sovereign rating to a notch above junk. (With inputs from Reuters). FTSE and CAC gained 0.34 percent while DAX was up 0.6 percent.
The 50-share NSE Nifty touched the 5700 level quite nicely following recovery in Indian rupee. Finance Minister P Chidambaram says there is no serious threat of a ratings downgrade after the rating agency Standard & Poor's has warned about a significant chance of cutting India's credit rating in the future.
Indian shares gained strength following rebound in European markets and on hopes of more reforms by the government. Today the Cabinet has allowed to direct transfer of urea subsidy, and tomorrow the Rangarajan Committee, set up by the prime minister’s office (PMO), is going to submit sugar decontrol report to Prime Minister.
Indian shares remained lacklustre but the broader markets outperformed due to rally in fertiliser stocks. Today the Cabinet has allowed direct transfer of urea subsidy, which was pending for long time.
Indian shares continued to consolidate since early trade following sharp drop in previous sessions due to profit booking. Investors seem to be cautious ahead of earnings season that will be kicked off tomorrow with Infosys (first company among largecaps) declaring results for the September quarter.
The 50-share NSE Nifty fell below the 5650 level amid choppy trade, weighed down by auto and FMCG stocks. The rise, however, in HDFC Bank, TCS and Bharti Airtel has limited the downside.
Indian equity benchmarks opened volatile on Thursday following a fall of about 400 points on the Sensex since the start of this week. They entered into a consolidation phase with the indices hovering around their previous closing values in early trade.
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