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The benchmark indices have rallied further in noon trades on the back of sustained strength in stocks such as BHEL, Coal India, L&T and RIL. The Sensex is quoting at 24419, stronger by 297 points and the Nifty is at 7283, up 80 points. The midcap index is at 8013, higher by 247 points and the smallcap index is at 8271, up 385 points.
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The benchmark indices have been steadily heading higher in noon trades due to the strength in power and oil space. The Sensex is up 215 points at 24,336 and the Nifty has gained 57 points at 7,260. The broader markets are outperforming the benchmark indices- The BSE mid-cap index has gained 2.8% at 7,987 and the small-cap index is up 4.4% at 8,283. The BSE PSU Index has topped the buying list, rising over 6 percent, followed by Power, Metal and Capital Goods with over 5 percent gains.
The markets had a big bang start to the day, with the Sensex gaining in the region of around 300 points at opening bell. The gains were short-lived as intra-day profit-booking dragged the bourses all the way into the red. However, the momentary blip seems to have attracted money on the sidelines.
Most global investors believe that India can see another round of re-rating as the elections have thrown up a stable government and this could push the market's P/E valuation to 17 times from 15 times at present. With Lok Sabha election results, and associated big market uncertainity out of the way, the investor focus is likely to shift to selection of Cabinet ministers and policy announcements from the new government.
On the global front, Japan's Nikkei dropped on Monday, extending losses from Friday as a stronger yen made investors risk averse, while sentiment was also hurt by weak China shares on concerns about slower growth in the world's second-biggest economy. The European markets, iuncluding the FTSE, CAC and DAX, have edged lower in early trades.
Coal India has galloped by 11.2% at Rs 384 to top the gainers list on the BSE. Power stocks are extending their recent upmove, with Tata Power strengthening by 6.6% at Rs 96 and NTPC gaining 6.1% at Rs 139. Oil and gas stocks have also flared up in this session; ONGC has gained 7.2% at Rs 412 and RIL has added 3.3% at Rs 1117. In the PSU space, Coal India, RCF, Power Finance Corporation, Indian Bank, Rural Electrification Corporation, Shipping Corporation of India, Hindustan Copper, BEML, HMT and Dena Bank have rallied 6-11% each, while HPCL, Engineers India, Union Bank of India, BPCL and STC have gained 5% each on the Bombay Stock Exchange (BSE). Financial stocks such as SBI, HDFC Bank and Axis Bank have gained around 4% each.
Among the midcap power stocks, REC has galloped by 16% at Rs 338, Power Finance has jumped by 14% at Rs 294 and Neyveli Lignite has soared by 13% at Rs 86.
On the other hand, the IT stocks continue to bleed on account of the strengthening rupee, among other things. TCS has slipped by 6% at Rs 2028, Infosys has weakened by 4.7% at Rs 3025 and Wipro has lost 4% at Rs 482.
The market breadth in BSE remains firm with 1824 shares advancing and 731 shares declining.
