Sensex hits almost one-year high

Key benchmark indices extended gains and hit fresh intraday high in morning trade. At 10:20 IST, the barometer index, the S&P BSE Sensex was up 216.84 points or 0.77% at 28,268.70. The Nifty 50 index was currently up 68.50 points or 0.79% at 8,707. Firmness in Asian stocks boosted sentiment. The Sensex hit highest level in almost one year. The Nifty hit highest level in more than fifteen months.

The Sensex rose 223.78 points or 0.79% at the day's high of 28,275.64 in morning trade, its highest level since 10 August 2015. The barometer index gained 25.56 points or 0.09% at the day's low of 28,077.42 at the onset of trading session. The Nifty rose 70.15 points or 0.81% at the day's high of 8,708.65 in morning trade, its highest level since 16 April 2015. The Nifty gained 12.30 points or 0.14% at the day's low of 8,650.80 at the onset of trading session.

In overseas stock markets, Asian shares rose as the chances of a US interest-rate increase diminished, after the nation's economic growth for the second quarter came in below expectations. The odds of a September US interest rate rise dropped to 12% from 18%, Fed Funds futures data showed, after the US economy grew at just 1.2% in the second quarter from a year earlier, well below estimates, data showed on Friday, 29 July 2016. Low US interest rates could support demand for emerging-market assets.

China's Shanghai Composite was down 1.26%. China's official manufacturing purchasing managers' index slipped below 50 in July, indicating a contraction in the nation's factory activity for the first time in five months, official data showed today, 1 August 2016. The index fell to 49.9 in July from 50.0 a month ago. China's official nonmanufacturing purchasing managers' index, a gauge of activity outside factory floors, climbed to 53.9 in July from 53.7 in June, the National Bureau of Statistics said today, 1 August 2016. A reading above 50 indicates an expansion, while a figure below that level indicates a contraction.

Strong earnings from Amazon and Google parent Alphabet lifted US stocks mostly higher on Friday, 29 July 2016, countering a disappointing report on second-quarter US economic growth.

Closer home, the broad market depicted strength. There were more than two gainers against every loser on BSE. 1,450 shares rose and 637 shares fell. A total of 101 shares were unchanged. The BSE Mid-Cap index was currently up 1.18%. The BSE Small-Cap index was currently up 0.9%. Both these indices outperformed the Sensex.

Maruti Suzuki India gained after reporting good sales in July. The stock gained 0.86% to Rs 4,796. The company's total sales rose 12.7% to 1.37 lakh units in July 2016 over July 2015. Domestic sales rose 13.9% to 1.25 lakh units in July 2016 over July 2015. Exports rose 0.3% to 11,338 units in July 2016 over July 2015. The announcement was made during market hours today, 1 August 2016.

India's largest engineering and construction major by sales L&T gained after the company announced good Q1 results. The stock rose 0.95% to Rs 1,572.75. The company's consolidated net profit rose 46% to Rs 610 crore on 9.1% growth in gross revenue to Rs 21874 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours on Friday, 29 July 2016. L&T's consolidated order book increased by 8% on year-on-year (YoY) basis to Rs 2.57 lakh crore as on 30 June 2016. International order book constituted 29% of the total order book.

On future business outlook, L&T said that on the international front, the company will continue to target select prospects in the space of core infrastructure and oil & gas sector in the Middle East, Africa and other neighboring countries. The company said it has recently finalised its strategic plan for five years with a focus on profitable growth. L&T said it remains well placed to benefit from emerging opportunities with its execution capabilities and leadership position in various sectors.

Strong results by L&T aided gains in other capital goods stocks. Bharat Heavy Electricals (Bhel) (up 1.27%), Havells India (up 1.69%), ABB India (up 1.37%), Bharat Electronics (up 0.64%), Thermax (up 0.41%), and Siemens (up 0.35%) gained.

The BSE Capital goods index had outperformed the market over the past one month till 29 July 2016, rising 5.31% compared with 4.9% rise in the Sensex. The index had also outperformed the market in past one quarter, advancing 17.23% as against Sensex's 9.55% rise.

Metal & mining stocks gained as copper prices rose in global commodity markets. JSW Steel (up 0.44%), Bhushan Steel (up 1.16%), Hindustan Copper (up 0.39%), Vedanta (up 1.76%), Hindalco Industries (up 1.91%), Hindustan Zinc (up 3.93%), Jindal Steel & Power (up 3.11%), Tata Steel (up 1.97%), Steel Authority of India (Sail) (up 1.6%), National Aluminum Company (up 1.07%) and NMDC (up 1.4%) gained.

High Grade Copper for September 2016 delivery was currently up 0.18% at $2.225 per pound on the COMEX.

The BSE Metal index had outperformed the market over the past one month till 29 July 2016, rising 12.33% compared with 4.9% rise in the Sensex. The index had also outperformed the market in past one quarter, advancing 18.18% as against Sensex's 9.55% rise.

Meanwhile, investors are awaiting the progress on the Goods and Services Tax (GST) constitutional amendment bill in parliament. According to reports, the government on Friday, 29 July 2016, listed the much-awaited GST bill for consideration and passage in Rajya Sabha's agenda for this week. Minister of state for parliamentary affairs Mukhtar Abbas Naqvi, while making a statement regarding government business for the week starting 1 August in the Upper House, reportedly said that the GST constitutional amendment bill will be taken up for consideration and passage in the Rajya Sabha. The government is keen to get the GST Bill approved during the Monsoon Session of Parliament ending on 12 August 2016.

The GST bill, which has been approved by the Lok Sabha, is pending in the Rajya Sabha because of opposition to the bill in its current form by the Congress party. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax.

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