Strong market breadth

Key benchmark indices extended intraday gains in morning trade. The barometer index, the S&P BSE Sensex, was up 124.96 points or 0.51%, up 134.98 points from the day's low and off 99.15 points from the day's high. The market breadth, indicating the overall health of the market was quite strong with more than 3 gainers for every loser. The BSE Mid-Cap index was up almost 2%. The BSE Small-Cap index was up more than 2.5%. Both these indices outperformed the Sensex. The market sentiment was boosted by data showing that foreign funds made substantial purchases of Indian stocks on Monday, 19 May 2014.

 

Index heavyweight Reliance Industries reversed initial gain in volatile trade. Metal and mining stocks were in demand on renewed buying. Shares of NMDC, Steel Authority of India (Sail), Sesa Sterlite and Hindalco Industries hit 52-week high. Wipro edged higher after the company announced bagging two new contracts.

A bout of volatility was witnessed in early trade as key benchmark indices regained positive zone after reversing gains after a firm opening. Key benchmark indices extended intraday gains in morning trade.

The market sentiment was boosted by data showing that foreign funds made substantial purchases of Indian stocks on Monday, 19 May 2014. Foreign institutional investors (FIIs) bought shares worth a net Rs 1350.04 crore on Monday, 19 May 2014, as per provisional data from the stock exchanges.

At 10:15 IST, the S&P BSE Sensex was up 124.96 points or 0.51% to 24,488.01. The index jumped 224.11 points at the day's high of 24,587.16 in early trade, its highest level since 16 May 2014. The index fell 10.02 points at the day's low of 24,353.03 in early trade.

The CNX Nifty was up 47.65 points or 0.66% to 7,311.20. The index hit a high of 7,353.65 in intraday trade, its highest level since 16 May 2014. The index hit a low of 7,262.30 in intraday trade.

The market breadth, indicating the overall health of the market was quite strong with more than 3 gainers for every loser. On BSE, 1,626 shares gained and 496 shares fell. A total of 72 shares were unchanged.

The BSE Mid-Cap index was up 148.78 points or 1.84% at 8,240.05. The BSE Small-Cap index was up 211.24 points or 2.53% to 8,555.94. Both these indices outperformed the Sensex.

The total turnover on BSE amounted to Rs 1869 crore by 10:15 IST, compared with Rs 754 crore by 09:30 IST.

Among the 30-share Sensex pack, 19 stocks gained and rest of them declined.

Index heavyweight Reliance Industries (RIL) was off 1.92% at Rs 1,098.80. The stock was volatile. The stock hit high of Rs 1,130 and low of Rs 1,093.20 so far during the day.

Metal and mining stocks were in demand on renewed buying. Tata Steel (up 3.53%), Hindustan Zinc (up 3.35%), Hindustan Copper (up 4.08%), National Aluminium Company (up 1.53%) and Jindal Steel & Power (up 0.19%) edged higher.

JSW Steel rose 0.6%. JSW Steel said after market hours on Monday, 19 May 2014 that crude steel production rose 14% to 9.9 lakh tonnes in April 2014 over April 2013. Production of flat rolled products rose 14% to 7.76 lakh tonnes in April 2014 over April 2013. Production of long rolled products rose 28% to 1.64 lakh tonnes in April 2014 over April 2013.

NMDC gained 2.98% to Rs 173.85 after hitting 52-week high of Rs 174.70 in intraday trade.

Steel Authority of India (Sail) advanced 3.94% to Rs 89.50 after hitting 52-week high of Rs 89.70 in intraday trade.

Sesa Sterlite jumped 4.46% to Rs 237.70 after hitting a 52-week high of Rs 238.35 in intraday trade.

Hindalco Industries gained 2.86% to Rs 156.40 after hitting a 52-week high of Rs 159.05 in intraday trade. The stock extended Monday's 7.76% rally. Novelis, Hindalco's US subsidiary, on Friday, 16 May 2014, said its net income attributable to its common shareholder was $54 million in Q4 March 2014, lower than $59 million in Q4 March 2013. Excluding certain tax-effected items, net income was $75 million in Q4 March 2014. Net sales rose to 1.96% to $2.54 billion in Q4 March 2014 over Q4 March 2013.

Wipro advanced 2.73%. Wipro before market hours announced that it has been selected by Corning Incorporated, a world leader in specialty glass and ceramics, to provide a multi-year information technology infrastructure program. Through this strategic collaboration, Wipro will make Corning's information technology services more resilient to market volatility, and enhance performance and operational efficiency. The solution will be delivered as a multi-year managed service from Wipro's global delivery and data centers.

Wipro announced after market hours on Monday, 19 May 2014, a strategic partnership with Takeda Pharmaceutical Company, the largest pharmaceutical company in Japan and one of the global leaders of the industry.

This strategic partnership will build advanced value in Takeda's operations by consolidating IT platforms across the organization. As a strategic partner, Wipro will build and maintain an "as-a-service" global platform for Takeda that will drive synergies across its global entities through standardization of IT architecture. Wipro will be primary provider of IT Infrastructure management services covering Takeda's entities across the world, touching 30,000 users in 16 different languages, operating out of data centers in Asia, Europe and America.

Reliance Power rose 3.14%. Reliance Power during market hours announced that the fourth 660 megawatt (MW) unit of the 3,960 MW Sasan Ultra Mega Power Project (UMPP) has commenced power generation thus making 2,640 MW capacity operational at the project. Balance two units are in advanced stages of construction and will be commissioned over the next few months. The Sasan Ultra Mega Power Project is the largest integrated power plant and coal mining project in the world. Coal production has already commenced from the 20 million tonnes Moher and Moher-Amlohri coal mines associated with the power project. With this unit, Reliance Power's generation capacity has increased to 4,525 MW which includes 4,440 MW of thermal capacity and 85 MW of renewable energy based capacity, Reliance Power said.

Reliance Power's consolidated net profit rose 1% to Rs 269 crore on 11% rise in total income to Rs 1400 crore in Q4 March 2014 over Q4 March 2013. Consolidated net profit rose 2% to Rs 1,027 crore on 5% rise in total income to Rs 5546 crore in the year ended 31 March 2014 (FY 2014) over the year ended 31March 2013 (FY 2013). The result was announced after market hours on Monday, 19 May 2014.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 58.635, compared with its close of 58.59/60 on Monday, 19 May 2014.

After Bharatiya Janata Party (BJP) led National Democratic Alliance's (NDA) landslide victory in Lok Sabha election, investors' focus has shifted to the likely allocation of key ministerial portfolios in the National Democratic Alliance (NDA) government. Investors will now be keenly watching policy announcements from the new government to drive a turnaround in the investment cycle.

Prime Minister-designate Narendra Modi is set to meet President Pranab Mukherjee today, 20 May 2014 and stake claim to form the new government. Ahead of that the Bharatiya Janata Party's parliamentary board will anoint him as their leader. The date of Modi's oath taking ceremony is also likely to be decided today, 20 May 2014 in the BJP's parliamentary board meeting. The top four ministers will be sworn in along with Modi during the oath-taking ceremony, reports added.

The first budget of the new government is expected by July 2014. An interim budget was presented by P. Chidambaram in February this year. Essentially, in the nature of a vote on account, the interim budget was intended to get Parliament approval for expenditure to be incurred during the first few months of fiscal year 2014-15 due to Lok Sabha elections.

The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014, as consumer-price inflation eased to a two-year low and as the rupee firmed up against the dollar.

Asian stocks edged higher on Tuesday, 20 May 2014, on tracking overnight gains in US markets. Key benchmark indices in Taiwan, Hong Kong, China and Japan were up 0.06% to 0.87%. Key benchmark indices in Singapore, Indonesia and South Korea were off 0.03% to 2.03%.

Singapore's gross domestic product expanded an annualized 2.3% in the three months through March from the previous quarter, when it climbed a revised 6.9%, the trade ministry said in a statement today, 20 May 2014.

Trading in US index futures indicated that the Dow could rise 3 points at the opening bell on Tuesday, 20 May 2014. US stocks ended Monday's thinly traded session higher with small-cap and tech companies leading the gains.

The Federal Reserve releases minutes from the April 29-30 meeting of Federal Open Market Committee tomorrow, 21 May 2014. The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 17-18 June 2014. The Fed on 30 April 2014 said after a monetary policy review that it will keep the benchmark interest-rate target at almost zero for a "considerable time" after its bond-buying program ends. The FOMC also reduced monthly debt purchases to $45 billion, its fourth straight $10 billion cut, and said further reductions are likely in "measured steps" if the economy continues to improve.

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