Market recovers on bargain hunting

A decent recovery was witnessed on the bourses after share prices witnessed a steep slide recently. The barometer index, the S&P BSE Sensex, jumped 311.22 points or 1.22% to settle at 25,764.78. The 50-unit CNX Nifty surged 106 points or 1.37% to settle at 7,823. Positive cues from global markets and data showing expansion in the services sector last month helped key benchmark indices snap three-day losing streak. Metal and banking stocks led rally for key benchmark indices which remained in green throughout the trading session.

The market breadth indicating the overall health of the market was strong. The BSE Small-Cap index rose 1.15%. The BSE Mid-Cap index rose 1.18%. Both these indices underperformed the Sensex.

Realty, cement and auto stocks edged higher. Shares of Vedanta group companies surged.

The Sensex rose 311.22 points or 1.22% to settle at 25,764.78, its highest closing level since 31 August 2015. The index jumped 381.85 points at the day's high of 25,835.41 in mid-afternoon trade. The index rose 102.21 points at the day's low of 25,555.77 in early trade.

The CNX Nifty rose 106 points or 1.37% to settle at 7,823, its highest closing level since 31 August 2015. The index hit a high of 7,845.60 in intraday trade. The index hit a low of 7,754.05 in intraday trade.

The BSE Mid-Cap index rose 123.14 points or 1.18% to settle at 10,560.21. The BSE Small-Cap index rose 123.92 points or 1.15% to settle at 10,873.55. Both these indices underperformed the Sensex.

The market breadth indicating the overall health of the market was strong. On BSE, 1,719 shares rose and 969 shares declined. A total of 133 shares were unchanged.

The total turnover on BSE amounted to Rs 2356 crore, lower than turnover of Rs 2596.85 crore registered during the previous trading session.

Among the sectoral indices on BSE, the S&P BSE Realty index (up 4.55%), the S&P BSE Metal index (up 2.43%), the S&P BSE Capital Goods index (up 1.98%), the S&P BSE Bankex (up 1.93%), the S&P BSE Power index (up 1.81%) and the S&P BSE Auto index (up 1.34%), outperformed the Sensex. The S&P BSE Oil & Gas index (up 0.95%), the S&P BSE Consumer Durables index (up 0.58%), the S&P BSE Teck index (up 0.51%), the S&P BSE IT index (up 0.44%), the S&P BSE FMCG index (up 0.37%) and the S&P BSE Healthcare index (up 0.09%), underperformed the Sensex.

Bank stocks edged higher on renewed buying. Among PSU banks, Central Bank of India (up 4.34%), Indian Bank (up 3.50%), Bank of Baroda (up 3.30%), IDBI Bank (up 3.28%), UCO Bank (up 2.12%), Canara Bank (up 2.01%), Bank of India (up 1.99%), Union Bank of India 1.77%), Syndicate Bank (up 1.48%), Andhra Bank 1.34%), Dena Bank (up 1.13%), Punjab National Bank (up 1%), United Bank of India (up 0.94%), State Bank of India (up 0.87%), Allahabad Bank (up 0.76%), Bank of Maharashtra (up 0.43%), Punjab and Sind Bank (up 0.42%) and Vijaya Bank (up 0.42%), edged higher. Corporation Bank was down 0.21%),

Among private sector banks, Axis Bank (up 4.19%), Kotak Mahindra Bank (up 3.35%), IndusInd Bank (up 3.06%), Yes Bank (up 1.74%), HDFC Bank (up 1.49%), City Union Bank (up 0.86%), ICICI Bank (up 0.60%) and Federal Bank (up 0.08%), edged higher.

Metal and mining stocks edged higher. Steel Authority of India (up 4.84%), Tata Steel (up 4.55%), JSW Steel (up 4.26%), Hindustan Zinc (up 4.18%), Hindalco Industries (up 3.42%), National Aluminium Company (up 2.63%), NMDC (up 2.34%), Jindal Steel & Power (up 1.40%), Hindustan Copper (up 1.36%) and Bhushan Steel (up 0.70%), edged higher.

Shares of Vedanta group companies surged. Cairn India surged 5.59% at Rs 149.30. Vedanta jumped 4.42% at Rs 98.05.

Realty shares were in demand. DLF (up 10.08%), Indiabulls Real Estate (up 6.70%), Oberoi Realty (up 6.68%), Housing Development and Infrastructure (HDIL) (up 5.37%), Sunteck Realty (up 4.65%), D B Realty (up 3.97%), Unitech (up 3.20%), Anant Raj (up 3.19%), Sobha (up 2.14%), Godrej Properties (up 1.94%), Peninsula Land (up 1.13%) and Prestige Estates Projects (up 0.17%), edged higher. Phoenix Mills (down 1.18%) and Parsvnath Developers (down 1.63%), edged lower.

Auto stocks edged higher. Maruti Suzuki (India) (up 2.86%), Tata Motors (up 2.46%), Bajaj Auto (up 1.79%), Ashok Leyland (up 1.69%), Mahindra & Mahindra (up 0.71%), TVS Motor Company (up 0.36%) and Eicher Motors (up 0.12%), edged higher. Hero MotoCorp (down 0.57%) and Escorts (down 0.62%), edged lower.

Cement shares were in demand. UltraTech Cement (up 4.41%), ACC (up 3.01%) and Shree Cement (up 0.10%), edged higher.

Grasim Industries was up 0.38%. Grasim has exposure to cement sector through its holding in UltraTech Cement.

Ambuja Cements rose 3.94% to Rs 218.75 after reports that a foreign brokerage firm has upgraded the stock to buy from neutral. The foreign brokerage firm has reportedly said that the current valuations of the company are reasonable in context of net cash balance sheet and strong franchise. The company would be key beneficiary of pick-up in demand from non-south regions of India, the brokerage reportedly added.

Lupin fell 0.58%. The company's US subsidiary Lupin Pharmaceuticals, Inc. (Lupin) has launched a generic antidepressant medicine in the United States (US). Lupin's Duloxetine 40 mg delayed-release (DR) capsule is the first and only generic Duloxetine formulation to become available in 40 mg dosage strength in the US. The annual market size of the branded and generic versions of antidepressant Cymbalta 20 mg, 30 mg and 60 mg capsule strengths is approximately $1.05 billion in the US, as per IMS MAT June 2015 data. Lupin made the announcement after market hours today, 3 September 2015.

Wipro rose 1.94%. The company announced after market hours today, 3 September 2015, that the company has been chosen by London-based Chelsea Football Club as its official digital and IT partner. As one of the world's leading sports brands, Chelsea Football Club will work with Wipro to create experiences for millions of its fans that span not only the in-stadium, game-day experience but also their digital experience, anytime and anywhere, Wipro and Chelsea said in a joint statement.

In overseas markets, European stocks surged on speculation that European Central Bank (ECB) President Mario Draghi will signal at a press conference after ECB's regulator monetary policy meeting later in the global day that the ECB is ready to expand measures aimed at bolstering inflation levels and boosting the eurozone economy if necessary. Earlier during the global day, Asian stocks nudged higher after a rally in US stocks overnight.

A favourable outcome of a monthly survey on the services sector also helped boost sentiment on the domestic bourses. The seasonally adjusted Nikkei Services Business Activity Index rose to 51.8 in August from July's 50.8, marking a second month above the 50-level that separates growth from contraction.

Meanwhile, the the International Monetary Fund (IMF) said in research paper on global growth prospects published yesterday, 2 September 2015, that near-term growth prospects remain favorable for India and that the country's external vulnerabilities have decreased. The IMF said that policy reforms, a consequent pickup in investment and lower commodity prices will boost India's growth. But, IMF cautioned that India continues to face some macroeconomic imbalances

Indian stocks bounced back after a recent sharp silde. The Sensex lost 938.82 points or 3.55% in the preceding three trading sessions to settle at 25,453.56 yesterday, 2 September 2015, from a recent high of 26,392.38 on 28 August 2015. The Sensex has fallen 518.31 points or 1.97% in this month so far (till 3 September 2015). The Sensex has fallen 1,734.64 points or 6.31% in this calendar year so far (till 3 September 2015). The Sensex has risen 466.36 points or 1.84% from a 52-week low of 25,298.42 hit on 25 August 2015. The Sensex is off 4,259.96 points or 14.19% from a record high of 30,024.74 hit on 4 March 2015.

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