Metal and banking stocks led the upmove as key benchmark indices extended gains in afternoon trade. At 13:28 IST, the barometer index, the S&P BSE Sensex, was up 185.87 points or 0.73% at 25,796.08. The 50-unit CNX Nifty was up 53.65 points or 0.69% at 7,842.95. On the macro front, the latest data showed that the annual rate of inflation based on monthly wholesale price index remained in negative zone for the 10th straight month in August 2015.
The broad market depicted strength. On BSE, there were nearly two gainers for every loser. 1,599 shares rose and 819 shares declined. A total of 79 shares were unchanged. The BSE Mid-Cap index was up 1.13%. The BSE Small-Cap index was up 0.83%. Both these indices outperformed the Sensex.
In overseas equity markets, European stocks edged higher in early trade there. In Asia, stocks in China and Japan edged lower after Chinese data released over the weekend showed growth in China's factory output and fixed-asset investment were both weaker than expected in August 2015, a month when Beijing temporarily closed some factories ahead of a high-profile military parade.
US stocks edged higher during the previous trading session on Friday, 11 September 2015, on speculation the US Federal Reserve will not hike interest rates this month due to concerns about global growth and amid a recent turmoil in global equity markets. The Fed's policy-making committee holds a two-day meeting on 16 and 17 September 2015. The Fed has held its benchmark short-term interest rate near zero since December 2008.
NTPC (up 2.93%), Axis Bank (up 2.64%) and ICICI Bank (up 1.95%) were among the major gainers from the Sensex pack.
In sector trends, IT stocks advanced. Tech Mahindra (up 0.06%), HCL Technologies (up 0.61%), TCS (up 0.37%), Infosys (up 0.45%), Oracle Financial Services Software (up 0.38%), and Wipro (up 2.03%) edged higher.
Metal & mining stocks gained on renewed buying. JSW Steel (up 2.86%), Hindustan Copper (up 0.57%), Vedanta (up 0.51%), Hindalco Industries (up 1.31%), Hindustan Zinc (up 0.77%), Jindal Steel & Power (up 1.46%), Tata Steel (up 2.12%), Steel Authority of India (Sail) (up 1.66%), National Aluminum Company (up 3.12%) and NMDC (up 1.49%) gained. Bhushan Steel fell 0.97%.
Coal India dropped 0.33% to Rs 332.95. The stock hit high of Rs 336.15 and low of Rs 331.30 so far during the day.
On the macro front, lower global crude oil prices and a recovery in the rupee against the dollar augur well for India. India imports about 80% of its crude requirements and lower crude oil prices ease concerns on fiscal deficit, inflation and gives more room for the government to boost growth through spending on infrastructure. In the global commodities markets, Brent for October settlement was currently off 50 cents at $47.64 a barrel. The contract had fallen 75 cents or 1.53% to settle at $48.14 a barrel during the previous trading session. The Brent October contract expires tomorrow, 15 September 2015. Brent for November settlement was currently off 43 cents at $48.61 a barrel.
A recovery in the rupee against the dollar has eased concerns about higher crude import costs. In the foreign exchange market, the partially convertible rupee was hovering at 66.3425, compared with its close of 66.53 during the previous trading session. A weak rupee raises the cost of imports.
Meanwhile, the annual rate of inflation based on monthly wholesale price index (WPI) stood at minus 4.95% (provisional) for the month of August 2015 compared to minus 4.05% (provisional) for the previous month and 3.85% during the corresponding month of the previous year, according to the data released by the government during market hours today, 14 September 2015.
The government is scheduled to unveil the consumer price index (CPI) data for the month of August 2015 after market hours today, 14 September 2015. The all-India general CPI inflation dipped to 3.78% in July 2015 from 5.4% in June 2015.
Meanwhile, data released after market hours on Friday, 11 September 2015 showed that India's index of industrial production (IIP) increased 4.2% in July 2015 over a year ago compared with the revised growth of 4.4% in June 2015. The IIP growth for June 2015 has been scaled up 4.4% in the first revision compared with 3.8% reported provisionally.
Another data released after market hours on Friday, 11 September 2015, showed that India's current account deficit (CAD) narrowed to $6.2 billion (1.2% of GDP) in Q1 June 2015 from $7.8 billion (1.6% of GDP) a year ago. This improvement was mainly on account of the merchandise trade deficit ($34.2 billion during Q1 June 2015) which contracted on a year-on-year (y-o-y) basis due to a larger absolute decline in merchandise imports relative to merchandise exports. The reduction in the CAD was also enabled by higher net earnings through services and lower outflow on account of primary income (profit, dividend and interest).
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