Global cues driven rally at D-Street; Nifty reclaims 7,800

Markets have extended its rally with Nifty reclaiming the 7,800 mark led by rate sensitive stocks amid positive global cues after US Federal Reserve meet minutes indicated an interest rate hike in the month of December. 

At 10:55 AM, the Sensex has climbed 263 points to trade 25,746 at and the Nifty has soared 81 points to trade at 7,813

Meanwhile, a strong rupee has lifted the sentiment at the D-Street. The rupee has recovered by 24 paise to 66.06 against the US dollar on sustained selling of the US currency by exporters and banks amid strength in the local equities.

 

IN ACTION

Pharma shares are witnessing selling pressure with Dr Reddy’s Lab dropping 3% after the company received a warning letter from the US FDA over quality control issues at three of its manufacturing facilities. Meanwhile, according to media reports, Lundin Law PC said it is investigating claims against Dr. Reddy’s Laboratories concerning possible violations of federal securities laws. The sentiment has dampened among the peers with Lupin, Sun Pharma trading lower by 1% each

Railway stocks are hogging limelight after the government approved Rs 8,349 crore investments on rail freight lines in three states. Among the pack, Titagarh Wagons Texmaco Rail & Engineering, Kalindee Rail Nirman, Hind Rectifiers, Stone India, Kernex Microsystems and BEML surged between 2-8% on the BSE.

In the auto pack, Hero Motocorp has emerged as a star performer with a gain of 1.5% after the company clocked over 10 lakh units in retail sales during the festive season in the current year. Among other auto companies, Maruti Suzuki, Bajaj Auto, M&M and Tata Motors have climbed between 0.8-2.5%.

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(updated at 10:55 AM)

Markets witnessed a gap-up opening mirroring strength among the global peers after US Federal Reserve meet minutes indicated an interest rate hike in the month of December. 

At 9:45 AM, the Sensex has soared 159 points higher at 25,641 and the Nifty is up 46 points higher at 7,778. The broader markets are trading in-line with the counterparts, BSE Midcap and Smallcap indices are up 0.6% each. 

According to Anand Rathi morning reports, Nifty needs to surpass crucial juncture of 7,777 -7,800 zone to get a bounce back move towards 7850 levels. However, holding below 7,750 levels may continue the selling pressure towards 7680 and lower levels. Meanwhile, Sensex needs to cross and hold 26,500 levels to witness bounce towards 26,800 and higher levels. However, if it fails to hold 26,250-26,220 levels then selling pressure will further decline the index towards 26,000 and lower levels.”

Asian equities are gaining mirroring a strong finish at the Wall Street after Federal Reserve indicated an interest rate hike in the month of December but would then proceed gradually further tightening.

Japan's Nikkei share average jumped hitting a fresh three-month high in the early trade as the stronger dollar continued to support risk appetite. Investors cautiously await for the outcome of a Bank of Japan policy meeting. Japan’s Nikkei, Hong Kong’s Hang Seng and Singapore’s Straits Times Composite have surged between 0.6-1.2%. Meanwhile, Shanghai Composite is trading flat with negative bias.

In the US market, Dow .DJI ended with a gain of 1.43% while the S&P 500 .SPX climbed 1.62% and the Nasdaq .IXIC surged 1.79%.

STOCKS

All sectoral indices are trading firm barring BSE Healthcare index with BSE Auto, Realty and Capital Goods indices trading nearly 1% each. 

Drug maker Dr Reddy’s Lab continues to slip further and is down 5.4% after media reports suggested that an international firm has started investigation in the company on possible violation of federal security laws. The sentiment has dampened among the peers with Lupin, Sun Pharma trading lower by 1% each. Meanwhile, BSE Healthcare index has lost 0.7%. 

Hero Motocorp has emerged as a star performer with a gain of 1.5% after the company clocked over 10 lakh units in retail sales during the festive season in the current year. Among other auto companies, Maruti Suzuki, Bajaj Auto and Tata Motors have climbed between 0.8-1.5%.

Vedanta has surged 1.5% after the company decided to reduce costs by as much as 25% amid decline in industrial metal prices. Among its peers Tata Steel and Hindalco have jumped 0.8-1.3%.

The union cabinet on Wednesday gave nod a 10% stake sale in Coal India and initial public offering (IPO) of Cochin Shipyard Ltd (CSL).  Coal India has lost 0.6%.

Profit booking is seen in GAIL after the shares of the company shot up yesterday as it stands to be a key beneficiary of the new draft hydrocarbon policy announced early this week. The stock is down 0.6% in a firm market.

Some of the prominent gainers on the Sensex include ICICI Bank, RIL, Cipla and Infosys up between 0.8-1.5%.