The Indian markets maintained their jubilant mood in the new week and overlooked a series of tepid economic data as traders went for buying in the beaten down sectors. Today, the start is likely to be in green taking cues from the good going in the regional peers. Traders will also be getting some support from the core sector data that rose 3.1% in July, lower than the 4.5% expansion in July 2012 but much higher than the 0.1% growth in June. Core sector accounts for nearly 40% of the index of industrial production (IIP), and the better number will boost the expectation of recovery in industrial activity. Meanwhile, RBI Governor designate Raghuram Rajan has said that there is no magic wand to solve the challenges before the country overnight and he will endeavour to deal with them one at a time. There will be buzz in the oil marketing companies as, though the international crude oil prices have started cooling down, it has been reported that under-recovery on diesel for the first fortnight effective Sept 1 was sharply upwards at Rs.12.12 per litre. Some action will be seen in the aviation stocks too, as ATF prices have been hiked by a steep 6.9 percent, taking the rates to lifetime high of Rs 75,031 per kilolitre.
The US markets remained closed on Monday on account of Labor Day public holiday, unable to give any cue to the other global markets. Though, the Asian markets have made an all green start with some of the indices even trading higher by over a percent. Commodity stocks in the region were trading higher on evidence of a pickup in global manufacturing. China's official non-manufacturing Purchasing Managers’ Index was 53.9 in August compared with 54.1 in July. Nikkei has surged close to around three percent as the yen weakened.
Back home, Indian markets made a fabulous start of the new week and month, adding over a percent to their last two session’s gaining streak. The best part of the rally was that it came tailing the sanguine global cues despite slew of weak economic numbers. Markets looked in jubilant mood since morning as the rupee after some initial weakness once again started strengthening against the dollar, while there was buying in all the beaten down stocks that helped the markets firm up in the second part, it was the strong start of the European markets that gave further boost to the markets. On the global front, though the Chinese market ended flat but most of the indices in the region ended higher. Later the European markets too made a jubilant start after the final reading on a euro-area manufacturing index came at 51.4, up from a flash reading of 51.3,confirming that the region’s manufacturing recovery has gathered pace. Back home, the euphoric Indian markets got the support of strength in rupee, which after closing at 65.71/$ in last session, showed some upmove in early trade. Though, the rupee pared all its gains going forward, the equity markets not only managed to keep the momentum going but added pace in the second half with the support of FMCG, metals and oil & gas stocks. The Indian markets even overlooked the weak economic data of first quarter GDP numbers, which came at 4.4% much lower than street expectation and the fiscal deficit of the nation touching Rs 3.4 lakh crore or 62.8% of the budget estimate in first four months (April-July) only. There was some disappointment with the manufacturing activity slipping into contraction zone for the first time in more than four years in August. The HSBC Manufacturing Purchasing Managers’ Index (PMI) fell from 50.1 to 48.5 in August. However, the numbers looked to be on anticipated lines and factored in, so the markets continued heading towards north. In the dying hours the markets got an added support of the non-sectoral sugar gauge, which surged anywhere near 10-20% for the day on hopes that the demand will increase due to the the upcoming festive season. Oil & gas stocks, especially the PSU oil marketing companies too gained around 1-2% after they hiked petrol and diesel prices during the weekend. IT stocks lost some sheen with rupee appreciation, while Auto index bounced back after many of the companies including Maruti Suzuki, Bajaj Auto, TVS Motors and Ashok Leyland reported sales improvement sequentially. The Broader markets, mainly the midcap stocks bounced back and outperformed the benchmarks. Finally, the BSE Sensex surged 266.41 points or 1.43% to settle at 18886.13, while the CNX Nifty climbed by 78.95 points or 1.44% to end at 5,550.75.
The US markets remained closed on Monday on account of Labor Day public holiday, unable to give any cue to the other global markets. Though, the Asian markets have made an all green start with some of the indices even trading higher by over a percent. Commodity stocks in the region were trading higher on evidence of a pickup in global manufacturing. China's official non-manufacturing Purchasing Managers’ Index was 53.9 in August compared with 54.1 in July. Nikkei has surged close to around three percent as the yen weakened.
Back home, Indian markets made a fabulous start of the new week and month, adding over a percent to their last two session’s gaining streak. The best part of the rally was that it came tailing the sanguine global cues despite slew of weak economic numbers. Markets looked in jubilant mood since morning as the rupee after some initial weakness once again started strengthening against the dollar, while there was buying in all the beaten down stocks that helped the markets firm up in the second part, it was the strong start of the European markets that gave further boost to the markets. On the global front, though the Chinese market ended flat but most of the indices in the region ended higher. Later the European markets too made a jubilant start after the final reading on a euro-area manufacturing index came at 51.4, up from a flash reading of 51.3,confirming that the region’s manufacturing recovery has gathered pace. Back home, the euphoric Indian markets got the support of strength in rupee, which after closing at 65.71/$ in last session, showed some upmove in early trade. Though, the rupee pared all its gains going forward, the equity markets not only managed to keep the momentum going but added pace in the second half with the support of FMCG, metals and oil & gas stocks. The Indian markets even overlooked the weak economic data of first quarter GDP numbers, which came at 4.4% much lower than street expectation and the fiscal deficit of the nation touching Rs 3.4 lakh crore or 62.8% of the budget estimate in first four months (April-July) only. There was some disappointment with the manufacturing activity slipping into contraction zone for the first time in more than four years in August. The HSBC Manufacturing Purchasing Managers’ Index (PMI) fell from 50.1 to 48.5 in August. However, the numbers looked to be on anticipated lines and factored in, so the markets continued heading towards north. In the dying hours the markets got an added support of the non-sectoral sugar gauge, which surged anywhere near 10-20% for the day on hopes that the demand will increase due to the the upcoming festive season. Oil & gas stocks, especially the PSU oil marketing companies too gained around 1-2% after they hiked petrol and diesel prices during the weekend. IT stocks lost some sheen with rupee appreciation, while Auto index bounced back after many of the companies including Maruti Suzuki, Bajaj Auto, TVS Motors and Ashok Leyland reported sales improvement sequentially. The Broader markets, mainly the midcap stocks bounced back and outperformed the benchmarks. Finally, the BSE Sensex surged 266.41 points or 1.43% to settle at 18886.13, while the CNX Nifty climbed by 78.95 points or 1.44% to end at 5,550.75.
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