Sensex ends 184 points higher led by IT; Infosys up 5%

Infosys, TCS, HUL and Reliance Industries were the top gainers of the day

Benchmark share indices ended marginally higher, amid a volatile trading session, led by IT majors after Infosys announced better-than-expected third quarter earnings.

The 30-share Sensex ended up 184 points at 27,458 and the 50-share Nifty gained 50 points to close at 8,284.

The broader markets were flat. The midcap index was almost unchanged while the smallcap index edged up by a marginal 0.1%.

INFOSYS Q3 RESULTS

Bangalore-based Infosys took the street and the analysts by surprise as its reported better than expected third quarter numbers for FY15. Infosys reported volume growth of 4.2% for the quarter, one of the best in three years.

The company reported healthy net profit growth for the quarter, but the biggest surprise came as it maintained its full-year guidance of 7-9% (on constant currency). The street was expecting that the company will reduce its guidance or maintain it at the lower end of the guidance due to currency volatility and traditionally softer third quarter.

Infosys reported net profit of Rs 3,250 crore for the third quarter ended December 31, 2014, up 4.9% from Rs 3,096 crore in quarter ended September 30, 2014. On a year-on-year basis, Infosys' net profit was up 13%.

“We are excited by several breakthrough results in Q3. Our 'renew and new' strategy, is being received well by our clients and our ecosystem and we are already seeing its early adoption”, said Vishal Sikka, CEO and Managing Director."Based on our strong performance, we are intensifying our efforts to deepen employee engagement, client ecosystem and strengthen our foundation of education as we build a next generation services company that innovates for consistent profitable growth.”

SECTORS & STOCKS

BSE IT index surged over 3.5% followed by counters like Oil and Gas, Consumer Durables, TECk and Healthcare, all gaining between 1-2%. On the losing side were sectors like Realty which dipped by 1.4% followed by counters like Power, Metal, Capital Goods and Banks, all down 0.3-0.9% each.

Shares of information technology (IT) companies were in demand with the CNX IT index surged 380 points after the sector major Infosys reported a better-than-expected net profit growth in October-December quarter (Q3).

Infosys, Tata Consultancy Services (TCS), Wipro, Tech Mahindra, Persistent Systems, MindTree, Hexaware Technologies and CMC rallied between 1.5-5% on the National Stock Exchange (NSE).

Other notable gainers from the Sensex pack were HUL, Dr Reddy’s Labs, ONGC, Cipla, Tata Motors and RIL.

Fast moving consumer goods (FMCG) company Hindustan Lever (HUL) added another 6% in today's trade at Rs 863, extending its past four day’s gain on BSE, after Deutsche Bank upgraded the stock to buy with a target price of Rs 900 per share.

Shares of pharmaceutical companies ended higher by upto 5% on reports that the Indian and global companies are looking to invest over Rs 1,000 crore in Gujarat's pharma sector.

Wockhardt, Cadila Healthcare, Cipla, IPCA Labs, Dr Reddy’s Labs, Torrent Pharma, Sun Pharma and Divis Labs gained between 1.5-4.5%.

Tata Steel was the other notable gainer, up 1.2% after Global rating agency Moody's has upgraded Tata Steel ("TSL")'s corporate family rating to Ba1 with a stable outlook.

On the losing side, NTPC, Bajaj Auto, ICICI Bank, ITC, Sesa Sterlite and Axis Bank dropped between 1-3.3% each.

The market breadth was negative on BSE. 1545 stocks declined while 1,347 stocks advanced.

GLOBAL MARKETS

Asian stocks rose on Friday on upbeat expectations for the closely-watched U.S. jobs data, while the euro continued to flirt with fresh nine-year lows against the dollar.

Equities worldwide suffered deep losses early this week as plunging oil prices and global growth woes triggered investor flight from risk assets. But optimism about the U.S. economy and prospects of more stimulus from the European Central Bank and China have diffused risk aversion for the time being.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 1.2%.

Australian shares added 1.6%, while the Shanghai Composite Index gained 2% and Hong Kong's Hang Seng index advanced 1.2%. Japan's Nikkei was up 0.1% after giving back earlier gains.