Moneycontrol Bureau
The market made some strong gains on the day of July series F&O expiry while global cues supported post Federal Open Market Committee (FOMC) meet. The US Federal Reserve kept rates unchanged, giving no hint of lift-off coming in the next meeting. Policymakers said the economy is expanding moderately, but made no mention of recent volatility around Greece or China.
The Nifty closed July series below the 8450 level. The 50-share index was at 8421.80, up 46.75 points or 0.6 percent. The Sensex gained 141.92 points or 0.5 percent at 27705.35.
Analysts feel that India looks good and may gain from the China turbulence. Michael Every, Head of Markets Research, Asia-Pacific, Rabobank says growth acceleration and policy reforms are making the India story attractive. He also thinks that India will benefit from slowdown in China’s economy and tumble in global commodity prices.
Agrees Anish Damania, Head-Institutional Equities, IDFC Securities that macros in India are currently well balanced and things are not that murky.July seriesJuly series was muted for market investors. Nifty was marginally up 0.3 percent while the Sensex was down 0.7 percent in the series. FMCG and IT indices were up 4.7 percent and 3.3 percent respectively. Metals index lost the most, dragging 9 percent. Both Midcap and Smallcap indices outperformed benchmark indices gaining 4 and 5.5 percent respectively.
Siddharth Bhamre of Angel Broking expects the market to be rangebound- a slight negative bias early on followed by bounceback. "Above 8,600 we see people getting bullish and below 8,300-8,200 people getting bearish and we believe that coming series may not be much different," he says.
Stock specific action
More than the Fed meet outcome, earnings related stocks contributed largely to the indices rally. Boosted by better-than-expected Q1 results, Dr Reddy’s gained 5 percent today. Its April-June quarter net profit rose 14 percent to Rs 626 crore from Rs 550.4 crore in corresponding quarter last fiscal. Total income, during the quarter, rose to Rs 3,758 crore up 7 percent from Rs 3,517.5. Business from North America, India and Europe fetched strong revenue.
ITC ended with gain of 4 percents even though cigarettes volume growth decline remains a concerns. What impressed investors are its margins. Its margins expanded by 400 basis points to 39.4 percent in June quarter against forecast of Rs 3,381 crore and 100 basis points expansion, respectively.
Other gainers were Cipla, HUL and HDFC.
IT stocks remained under pressure with major laggards like TCS and Infosys losing around 1 percent. Other losers on the Sensex were Sun Pharma, Hindalco and Tata Steel.
Both Midcap and Smallcap indices outperformed. Bombay Burmah, WABCO India, Blue Star, Zensar Tech and KRBL were top gainers.
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