Strong market breadth

Key benchmark indices hovered in positive terrain in morning trade. Gains were small. At 10:20 IST, the barometer index, the S&P BSE Sensex was up 29.56 points or 0.11% at 27,039.23. The Nifty 50 index was currently up 3.75 points or 0.05% at 8,270.20.

The Sensex rose 95.74 points or 0.35% at the day's high of 27,105.41 at the onset of the trading session, its highest level since 28 October 2015. The index gained 1.37 points at the day's low of 27,011.04 in early trade. The Nifty rose 22.45 points or 0.27% at the day's high of 8,288.90 at the onset of the trading session. The index fell 3.95 points or 0.04% at the day's low of 8,262.50 in early trade.

In overseas markets, Asian stocks were mixed as weak Chinese export data offset a brightening energy sector outlook and an expected delay in interest rate hikes by the US Federal Reserve. Data showed that China's exports fell more than expected in May as global demand remained stubbornly weak, but imports beat forecasts, adding to hopes that the economy may be stabilising. Exports fell 4.1% and imports dropped 0.4% from a year earlier. Separately, China's central bank, People's Bank of China said it was keeping its economic growth forecast for 2016 year steady at 6.8% but it now expects exports to contract and fixed asset investment to grow more strongly than previously forecast. Meanwhile, Japan's economy grew faster than initially estimated in the first quarter. Japan's economy expanded at an annualized 1.9% rate in the first quarter of this year, revised up from a preliminary reading of 1.7% growth.

US stocks eked out modest gains yesterday, 7 June 2016 propelled by a sharp rally in the energy sector. Investors shrugged off US government data yesterday, 7 June 2016 that showed productivity of businesses and workers fell in the first quarter, but by less than initially reported.

Closer home, the market breadth indicating the overall health of the market was strong. On BSE, 1,037 shares rose and 585 shares declined. A total of 80 shares were unchanged. The BSE Mid-Cap index was currently up 0.41%. The BSE Small-Cap index was currently up 0.56%. Both these indices outperformed the Sensex.

Most capital goods stocks gained. BEML (up 2.32%), Bharat Heavy Electricals (Bhel) (up 1.01%), Havells India (up 0.49%), Bharat Electronics (up 1.59%), and Siemens (up 0.17%) gained. ABB India (down 0.28%) and Thermax (down 0.34%) declined.

L&T rose after the company announced that its construction arm along with its joint venture (JV) partner in Qatar, Al Balagh Trading & Contracting, has signed a contract to build a 40,000 seater stadium, as part of the sports infrastructure being readied by the Emirate in preparation of the 2022 Fifa World Cup. The stock gained 0.63%. The contract for the project is for a combined value of $360 million for both JV partners and is slated to be completed by 2019. The scope for the stadium includes main works and construction of the site, following completion of the enabling works, L&T said in a statement. The announcement was made after market hours yesterday, 7 June 2016.

Telecom stocks gained. Bharti Airtel (up 2.19%), Tata Teleservices (Maharashtra) (up 0.79%) Reliance Communications (up 1.86%) and Idea Cellular (up 0.62%) gained.

Shares of Bharti Infratel gained 0.37%. Bharti Infratel is a provider of tower and related infrastructure and is a unit of Bharti Airtel.

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