Sensex up over 100 points; Auto shares rally

Markets gained momentum, supported by heavy buying of auto and metal shares ahead of the Union budget, due 10th of July.

 

At 11.40 AM, the 30-share Sensex gained 122 points at 25,536 level and  the 50-share Nifty inched up 22 points  at  7,633  level.

 

Meanwhile, the rupee is trading at 60 against the US dollar on the back of Increased selling of the dollar by banks and exporters amidst sustained inflows of foreign funds.

 

Furthermore, the Brent crude fell toward $112 a barrel hitting an 18-day low as did US crude near $105, as investors grew less worried about potential supply disruptions from Iraq.

 

Asian Markets:

Asian shares held near three-year highs on Tuesday on upbeat Chinese manufacturing data and expectations that U.S. monetary policy will stay loose for some time, while the dollar was broadly soft.  Japan’s Nikkie rose 1% and Shanghai Composite Index gained 0.05%On the other hand, Straits Times Index lost 0.5%, Hong Kong'Hang Seng Index dipped 0.13%.

 

Among sectoral indices, BSE Metal index led the rally followed by Realty, Auto and Capital goods indices up between 0.9-2.5%, each. In contrast, BSE IT and Oil& Gas indices lost sheen.

 

The metal shares surged on the back of positive Chinese PMI data. The PMI stood at 51 for the month of June. Sesa sterlite, Coal India and Tata Steel surged between1.14%-2.8%, each. Hindalco gained 7% to Rs 176, also its highest level since July 2011 on NSE, after CLSA upgraded the stock to buy from sell rating with a target price of Rs 215.

 

Power and infra shares continued to attract attention from investors on hopes of strong reforms for these sectors in the forthcoming Budget. Tata Power, L&T and BHEL contributed 0.6%-1.5%, each. An increase in the HSBC Manufacturing Purchasing Managers' Index (PMI) quoting at 51.5, compiled by Markit further boosted the sentiment. 

 

The S&P BSE Realty index was up 0.7% on the hopes that Modi-led government will construct affordable low-cost housing for people. 

 

Banking shares extended their yesterday’s rally with ICICI Bank, Axis Bank and SBI up 0.1%-1.4%, each

 

BSE Auto surged 1.6%. Maruti Suzuki, M&M, Tata Motors and Hero motocorp gained between 0.8%-5%, each on the back of strong monthly Auto sales numbers. The total vehicle sale of Maruti Suzuki is 112,773 units, compared to 84,455 units during the same month last year.

 

The healthcare shares including Sun Pharma and Dr. Reddy’s Lab, after rallying in the recent past, lost 0.5%, each during the mid day trades.

 

An appreciating rupee casted its shadow on the technology stocks with TCS, Infosys and Wipro down between 0.8%-1.1%, each.

 

Shares of oil marketing companies (OMCs) which rallied up to 3% during early trade after OMCs raised petrol prices by Rs 1.69 a litre and diesel by 50 paise a litre dropped on the account of profit booking.  RIL and GAIL lost 0.2%, each

 

In addition, Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) were down between 1-3% on the BSE.

 

The BSE Midcap was in line with the largecap counterparts and was up 0.4%, whereas the smallcap index outshined and was up 1.0%

 

Sasken Communication Technologies surged 20% to Rs 266 on NSE after the company said it has received arbitration award in its favor in the matter of Spreadtrum Communications Inc.

 

Hindustan Construction Company (HCC) surged 5% to Rs 49, its highest level since January 2011 on BSE, on back of heavy volumes.