Markets remain steady after opening at record highs; Nifty tests 9,650

The S&P BSE Sensex touched a new high of 31,332, surpassing the previous milestone of 31,220

Benchmark indices pared some gains but remained steady after opening at record high with Sensex scaling 31,300 tracking gains in global markets as Wall Street touched record highs on upbeat US manufacturing and employment data. 

The S&P BSE Sensex gained as much as 195 points to touch a new high of 31,332, surpassing the previous milestone of 31,220 hit on May 29 while the broader Nifty50 rose as much as 16 ponts to reach a fresh high of 9,673, scaling last peak of 9,637 hit on May 29.
 
The strong data suggested the US economy is regaining speed after struggling at the start of the year, which could make a strong case for a rate hike by US Fed. San Francisco Federal Reserve Bank President John Williams on Wednesday said while he saw three interest rate hikes this year as his baseline scenario, four rate increases would also be appropriate if the economy got an unexpected boost, Reuters reported.
 
At 12:33 pm, the S&P BSE Sensex was trading at 31,275, up 137 points, while the broader Nifty50 was ruling at 9,654, up 38 points.
 
In the broader market, the S&P BSE Midcap and the S&P BSE Smallcap indices gained 0.6% and 0.3%, respectively.

"Yesterday’s dips evolved on anticipated lines, and with dips not extending much,the following upswing that could unfold today, could be consequently limited to 9,670 or 9,727. The flat oscillators disussed yesterday as well, corroborates the expectations towards limited upsides, but a direct rise above 9,727 could re-align indicators," said Geojit Financial Services in a note.

Buzzing Stocks

Bhart Airtel, Cipla, Tata Motors, HeroMoto Corp and NTPC gained the most on BSE Sensex while Tata Steel, Bajaj Auto, and PowerGrid lost the most.
 
TVS Motor Company gained 5.24 % after it reported a 16% increase in total sales at 2,82,007 units in May. The Chennai-based company had sold 2,43,783 units in May 2016. Total two-wheeler sales during the month increased 15.6 per cent to 2,75,426 units. 

Bharti Airtel gained 3 % on receiving approvals from the Securities & Exchange Board of India, BSE and the National Stock Exchange of India for its proposed merger with Telenor India. 

Donald Trump pulls out of Paris climate agreement
 
President Donald Trump on Thursday withdrew the US from the landmark Paris climate accord. Ostensibly, according to Trump, the accord is not tough on India and China. Further, he alleged that the deal was negotiated "poorly" by the Obama administration and signed out of "desperation".
 
"In order to fulfil my solemn duty to protect our citizens, the United States will withdraw from the Paris Climate Accord... We are getting out and we will start to renegotiate," Trump said at the Rose Garden of the White House.
 
The US, however, will not immediately pull out of the Paris Act. He would follow the four-year rule to get out of it. This means that the US will leave the Paris Agreement in 2020. READ FULL REPORT HERE
 
Global Markets
 
Asian stocks edged up on Friday and the dollar bounced from recent lows as upbeat data on US manufacturing and employment and buoyant European factory growth boosted investor optimism.
 
MSCI's broadest index of Asia-Pacific shares outside Japan ticked up 0.1%, while Japan's Nikkei gained 1% to top the psychologically important 20,000-point level for the first time since August 2015.
 
"Market sentiment is very good. The strength in Wall Street shares will be a tailwind for the Nikkei as well," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.
 
MSCI ACWI, an index of 46 stock markets in the world, hit a record high, having gained 0.6% on Thursday.
 
In overnight trade, the Dow Jones Industrial Average index gained 0.65% while the S&P500 index rose 0.76% and the Nasdaq Composite index advanced 0.78%.