Thursday, 9 April 2015

Nifty ends above 8750, Sensex jumps; banks support

03:30pm Market Closing: The market sustained its uptrend for the fifth consecutive session today with the Sensex rallying 177.46 points to 28885.21 after the Moody's upgraded outlook on India to positive from stable. The Nifty closed above 8750, up 63.90 points at 8778.30 supported by Reliance Industries and banks stocks.

About 1578 shares have advanced, 1263 shares declined, and 144 shares are unchanged on the BSE.
03:20pm Telecom stocks in News: Bharti Airtel and Idea Cellular fell 2.5 percent after TRAI said it has reduced ceiling tariffs for national roaming service w.e.f. May 1, mandating telecom companies to offer special roaming tariff plan.

The telecom regulator cut ceiling tariff on outgoing local voice call on roaming to 80 paise per minute and ceiling tariff on incoming local call charges on roaming to 45 paise per minute.

03:10pm Market Update: The market gained strength again. The Sensex rose 152.80 points to 28860.55 and the Nifty rallied 57.40 points to 8771.80. About 1498 shares have advanced, 1255 shares declined, and 159 shares are unchanged on the BSE.

Reliance Industries, HDFC Bank, ICICI Bank, Axis Bank, SBI and Tata Steel surged 1.5-3 percent while Sun Pharma, Bharti Airtel, Cipla and GAIL fell 2-4 percent. BSE Bankex went up 2.7 percent.

02:50pm Rajan talks: The outlook upgrade is a positive perception of what we have done over the past few quarters. Presumably Moody’s sees this as a first step to rating upgrade, said Reserve Bank Governor Raghuram Rajan.

He, however, cautions that the government and regulators should not lose sight on what more needs to be done. “We should not celebrate upgrades as we did not worry about downgrades. There are a lot of low-hanging fruits that need to be picked,” Rajan said in an exclusive interview.

The RBI left the key interest rates unchanged at its bi-monthly review on April 7, after effecting two out-of-cycle rate cuts earlier this year for 25 basis points (0.25 percent) each.

Rajan said the quality of fiscal spending, which has been subdued over the last few years, is more important. The state of economy is weak and a high quality fiscal spending can be a good thing, but ramping it up will take some time.

On inflation, Rajan said that the country is still not out of woods and he would be happy to see more steps on fiscal consolidation.

02:25pm FII View: India's outlook upgrade by Moody's isa reflection of the fundamentals improving dramatically in India and it will lead to further inflows by FIIs, said Hans Goetti, head of Investment – Asia, Banque Internationale.

"We have actually seen quite a lot of inflows over the past few months into bonds especially fixed income. This is because interest rates in India are bound to come down as inflation comes down and on a risk reward basis bonds are probably even more attractive than equities at this point, so foreign inflows will continue," he added.

02:00pm Market Check

The market continued to be choppy with positive bias in afternoon trade. Banks, select metals and Reliance Industries supported the market whereas pharma, capital goods and PSU oil stocks remained under pressure.

The Sensex rose 41.97 points to 28749.72 and the Nifty advanced 19.05 points to 8733.45. About 1488 shares have advanced, 1183 shares declined, and 152 shares are unchanged on the BSE.

The big news of the day was that Moody's upgraded India's outlook to positive from stable, but the rating remains unchanged at Baa3. The rating agency that rating upgrade will depend on investment uptick & reform implementation.

Banking majors ICICI Bank, HDFC Bank, SBI and Axis Bank rallied 1.5-2.5 percent with the Bank Nifty up 300 points. Tata Steel climbed 1.7 percent. Coal India advanced over 1 percent as brokerage Macquarie reiterated its outperform rating on the stock with increased target price of Rs 452 (from Rs 420) and upgraded earnings by 8 percent after coal ministry issued a directive removing an earlier cap on e-auction volume effective April 2015.

However, pharma stocks declined as Bank of America Merrill Lynch downgraded Sun Pharma to underperform from buy; and Lupin, Cipla & Cadila Healthcare to neutral from buy. The brokerage believes that some stocks in sector may be priced to perfection with less room for error. Sun Pharma, Lupin and Cadila Healthcare tanked 3.5 percent each while Cipla lost 2.4 percent.

Inox Wind listed at a 24 percent premium to the issue price of Rs 325 today. Deepak Asher, Director of the company said the company is extremely bullish on the renewable energy sector which is set for unprecedented growth going forward.

Meanwhle, the law finally catched up with Ramalinga Raju as the Hyderabad Special Court found Raju and all accused guilty in the Satyam fraud case.. The court found Raju guilty of cheating, forgery, criminal breach of trust. The court will decide the quantum of sentence today. For more information please visit this site

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