Moneycontrol Bureau
Equity benchmarks continued record breaking spree with the Sensex closing above the 28000-mark for the first time on the back of buying in rate sensitives - banking & financials and autos stocks. However, the market halved its gains in last couple of hours of trade due to weak European cues.
The 30-share BSE Sensex rose 98.84 points to close at 28008.90 and the 50-share NSE Nifty hit 8400 level during the day but could not hold the same, up 20.65 points to end at 8383.30. The broader markets gained too, the BSE Midcap and Smallcap indices climbed 0.5 percent and 0.2 percent, respectively.
Experts believe the market may continue to hit new high in medium term amid intermittent consolidation and correction.
Prolonging bullish tone of the market, Ravi Muthukrishnan, Co-head research, ICICI Securities has a Nifty target of 9,200 in a year’s time. In addition, he expects earnings to grow 16-18 percent in FY15-16.
With most earnings meeting street estimates, winter session of Parliament coming in and anticipation of various reforms encircling the Budget, he sees huge upside for the market hereon.
According to, Motilal Oswal, CMD ,Motilal Oswal Financial Services, the themes playing in Indian markets currently are the massive balance sheet expansion by Bank of Japan, probable balance sheet expansion by the ECB early next year, collapsing commodity prices due to a strong US dollar and a slowing Chinese economy leading to a slowing inflation and eventual softening interest rates in India
On the global front, major Asian markets closed higher with the Nikkei hitting a fresh seven-year high (up 0.4 percent) as media report suggested that Prime Minister Shinzo Abe will delay a second sales tax hike to avoiding damaging Japan's economic recovery, and call a snap election to cement his position. China’s Shanghai and Hong Kong’s Hang Seng gained 0.5-1 percent.
However, European markets trimmed losses to trade with marginal losses (at 16:30 hours IST). In early trade, Germany's DAX and France's CAC had declined 1-1.5 percent after the announcement of regulatory penalties for the alleged manipulation of forex markets. The UK Financial Conduct Authority (FCA) has imposed fines totalling more than USD 1.7 billion on lenders like Citi Bank, JPMorgan Chase and UBS.
Back home, rate sensitives like banks and autos indices touched record highs intraday ahead October CPI and September industrial output data that will be announced today evening.
Private sectore lenders ICICI Bank and Axis Bank rallied 1.3 percent and 3 percent, respectively. HDFC Bank was up 0.5 percent and SBI gained 0.2 percent while housing finance company HDFC climbed over a percent.
Auto stocks like Tata Motors, Hero Motcorp and Bajaj Auto rallied 1.5-2 percent followed by Maruti with 0.8 percent whereas M&M fell 0.6 percent. Media report suggested that commercial vehicle maker Tata Motors and utility vehicle maker Mahindra & Mahindra announced price increases in the range of 1-2 percent, citing higher input costs.
Cigarette maker ITC was up 1.5 percent.
Tata Steel fell more than 2 percent ahead of second quarter earnings. After market hours, the steel maker said its consolidated profit grew by 36.8 percent year-on-year to Rs 1,254 crore for the July-September quarter led by income from land sale in Mumbai. Earnings missed street expectations on every front.
Shares of L&T, Cipla, Sun Pharma, NTPC and Tata Power were down 1-3 percent.
In the broader space, state-run Oil India lost more than 2 percent after reporting a 32.7 percent decline in net profit at Rs 608.3 crore in July-September quarter on lower revenues and operational income.
Bajaj Hindusthan climbed 6 percent after the company reduced its net loss significantly to Rs 131 crore in July-September quarter from Rs 509.5 crore in same quarter previous fiscal led by lower expenses, cut in sugar business loss, higher other income and strong profit in distillery business.
About 1524 shares advanced while 1521 shares declined on the Bombay Stock Exchange.
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