Nifty reclaims 8,000; Sensex up 200 points

Sensex is at 26,806 with a gain of 200 points while Nifty has gained 61 points and is at 8,019.

Benchmark indices are trading firm after the RBI monetary policy statement reinforced expectations of key policy rates to remain unchanged atleast till next year. Gains in HDFC twins and L&T stocks have contributed the most to the rise on the Sensex.

RBI Monetary Policy:

 

RBI after its fourth bi-monthly monetary policy review  also kept cash reserve ratio unchanged at 4% of net demand and time liabilities (NDTL). It has reduced the liquidity provided under the export credit refinance (ECR) facility from 32% of eligible export credit outstanding to 15% with effect from 10 October 2014

 

At 12.45 Hrs, Sensex is at 26,806 with a gain of 200 points while Nifty has gained  61 points and is trading at 8,019.

 

In the broader market, both BSE MId cap and Small Cap indices have outperformed the large counterparts with gains around 0.8% each.

 

Market breadth is positive on the BSE with 1589 advances against 969 declines.

 

On Monday, FIIs remained net sellers with net sales of 250 crores.The Fed's tapering of its quantitative easing and the European Central Bank's quantitative easing may influence FII movement.

 

Rupee:

The Rupee is trading at 61.60  against a strengthening US Dollar. The rupee ended at near a seven-month low due to increase in US economic growth which fuelled concerns that the US Fed may start raising interest rates sooner.

 

Asian Markets:

 

Hang Seng has continued to decline and lost 1.2%  to its lowest in three months while Shanghai Composite with a gain of 0.3%,  remains vulnerable to the spill over effects from the ongoing pro-democracy protests in Honk Kong.

 

In China, steady factory activity and rise in export orders in the month of September have improved the sentiments though further weakness in job market, a huge concern for Chinese authorities, still weighs heavily.

 

Ambiguous state of Japan's economy, particularly given the mixed nature of latest economic assessment reports which suggested decline in unemployment rates  and rebound in retail sales along with a sharp decline in household spending and industrial output, has kept the Nikkei suppressed with a decline of around 0.8%. 

 

Sectors and Stocks:

 

Except BSE IT and Teck sectoral indices, all other indices are trading in the positive teritory. Festive buying has brought a surge in BSE Consumer durables index which is gaining around 2-3%.

 

Expectations of a major manufacturing boost to the economy has surged the capital goods sector by 1.5%.

 

HDFC gorup shares are up along with certain Sensex heavy weights, such as ITC and Tata motors.

Tata Motors gained after the company announced the appointment of Mr. Mayank Pareek as President, Passenger Vehicle Business Unit (PVBU) of Tata Motors.

Rebound in L&T shares have surged its stocks by around 2% after the company said it has won new orders worth Rs 1,423 crore across various business segments in September 2014, including order from Lucknow Metro Rail Corporation.

In the Pharma space, Sun Pharma is trading with a gain of more than 2% and Cipla has surged 1.5% on the back of Strong growth in Kenyan market.

IT majors, Infosys and TCS which climbed yesterday on the back of US GDP growth are trading lower today on profit taking. However reports about restructuring at Wipro has kept the company's stocks in green. Wipro is reported to go for more automation to reduce work force from 1.46 lacs to around 1 lakh.