Sensex ends 127 points higher; financials & Infosys lead

Benchmark share indices ended higher, amid a choppy trading session, led by financials and IT major Infosys after it posted better-than-expected third quarter earnings.

The 30-share Sensex ended higher by 127 points at 27,585 and the 50-share Nifty gained 39 points to close at 8,323.

The broader markets outperformed the benchmark indices- BSE Midcap and Smallcap indices gained by nearly 1%.

The market breadth in BSE ended firm with 1,647 shares advancing and 1,259 shares declining.

Adds Shrikant Chouhan, Head- Technical Research, Kotak Securities,“Today was the day full of excitement. The excitement was in terms of likely positive domestic news flow on Inflation and on IIP front.  Accordingly banks and other interest sensitive stocks participated in today’s move. Indices opened lower on the back of weak global cues but sustained well above the support level of 8245 and reversed sharply after a positive opening from European markets. The most interesting part of the day was participation of technology and bank stocks in the same direction.  

Market Breadth of the day was quite impressive mainly because of participation of mid/small cap stocks. Volume gainers were from mid cap space like Mcdowels, BEML, Tata Elxsi, Intellect and Bharat Forge. Tech Mahindra and Infosys were gainers from the large space along with unbeatable performance from Hindustan Uniliver, which gained almost 18% in just 5 days inspite of being expensive in term of valuations. For Tuesday, higher opening would result into major short covering minimum up to 8370.  On the other hand, breach of 8245 may invite liquidation of long positions.”    

Further, foreign portfolio investors (FPI) sold shares worth a net Rs 297.99 crore on Friday, as per provisional data.

At 3:30 PM, the rupee was trading at 62.23 per dollar vs previous close of 62.31 for the fourth consecutive session.

GLOBAL MARKETS

The Nikkei rose for a third day on Friday on growing confidence in the U.S. economy and hopes of aggressive stimulus steps in Europe, while Fast Retailing Co rose after reporting strong quarterly profits.

The Nikkei advanced 0.2% to end at 17,197.73 after dipping into negative territory earlier. For the week, it dropped 1.5%. The broader Topix added 0.2% to 1,380.58, and the new JPX-Nikkei Index 400 gained 0.2% to 12,495.99.

Index-heavy Fast Retailing gained 0.8% and contributed a hefty 40 points to the benchmark Nikkei index after reporting strong first quarter profits.

The US dollar took a dip on Monday as Asian investors caught up with a benign payrolls report and the subsequent slide in Treasury yields, while oil prices showed no sign of escaping their downward spiral.

Share markets were mostly lower following a soft finish on Wall Street though sentiment was supported by speculation the Federal Reserve would be patient in tightening policy given the weakness of wages apparent in the jobs numbers.

SECTORS & STOCKS

BSE FMCG, Bankex, Power, Capital Goods and IT indices gained between 0.5-1.6%. However, BSE Metal and Oil & Gas indices were down 1-2%.

The main gainers on the Sensex were HUL, L&T, Infosys, HDFC, ICICI Bank, BHEL, Axis Banka and SBI.

Shares of fast moving consumer goods (FMCG) major Hindustan Unilever (HUL) rallied nearly 4% to Rs 897, extending its past five-day’s gain, recording its sharpest rally in 20-months.

Infosys extended gains and surged 2% after the IT major last week announced third quarter earnings which beat street estimates.

Banking shares ended higher by up to 6% on the NSE ahead of retail inflation and IIP data to be released later in the day.

Tata Motors ended marginally positive. Tata Motors owned Jaguar Land Rover (JLR), UK's premium luxury car manufacturer today announced that it plans to create 1,300 new jobs at its UK plant as it plans to add new Jaguar models to its product portfolio

On the losing side, Coal India declined over 4.5%. Media reports suggest that the government is planning to reduce its stake in Coal India by 10%.

Bharti Airtel lost around 2%. Media reports suggest that the Supreme Court today refused to grant a stay on proposed auction of spectrum allocated to Bharti Airtel.

Oil shares were under pressure on further decline in crude prices. RIL lost 2% while ONGC and GAIL declined 1% each. Reliance Industries Chairman Mukesh Ambani announced Rs 100,000 crore investments across businesses in the next 12-18 months and said India was on the path to become the world's fastest growing economy.