In volatile trade,the S&P BSE Sensex today advanced by 158 points — the most in over three weeks — on buying in metal,FMCG and healthcare stocks amid encouraging trade data and hopes of more steps by government to support the weak rupee.
Gains in Sensex were,however,capped after State Bank of India (SBI) shares slipped by over 3.4 per cent on dismal earnings.
The 30-share index,which had gained 124.46 points in the previous session,rose further by 157.64 points,or 0.84 per cent,to 18,946.98. Intra-day,it had touched 19,066.97. Today’s gain was Sensex’s best since 179.6 points on July 18.
Brokers said the market was in oversold zone following recent bearish phase and investors indulged in picking fundamentally strong stocks available at attractive levels.
The broad-based National Stock Exchange index NSE Nifty rose 46.75 points,or 0.84 per cent,to cross the key 5600-mark. It ended at 5,612.40,led by metal,FMCG and healthcare stocks.
SX40 index,the flagship index of Multi Commodity Exchange of India Ltd (MCX),closed at 11,258.94,up 105.09,or 0.94 per cent.
Exports grew by 11.64 per cent to USD 25.83 billion in July,snapping two consecutive months of decline. All eyes are now on Consumer Price Inflation (July) and IIP figures (June).
“New liquidity tightening measures announced by the RBI had a negative impact on the banking stocks. The downtrend in banking stocks was aggravated by the poor asset quality of SBI,which declared quarterly numbers,” said Dipen Shah,Head- Private Client Group Research,Kotak Securities.
Analysts said expectations are high that the government and the RBI will come out with a raft of measures to support the rupee and instill confidence in the markets.
Sectorally,the BSE metal sector index gained the most by 4.52 per cent followed by FMCG (2.30 per cent),Healthcare (2 per cent) and Capital Goods (1.95 per cent).
Indian shares gain nearly 1 pct; rupee,govt actions watched
(Reuters) BSE Sensex rose nearly 1 percent on Monday with defensive stocks such as ITC rising on HSBC’s upgrade,while Sun Pharmaceuticals Industries surged after its adjusted June-quarter profit beat estimates.
Investors remained cautious as the central bank’s latest measures to drain cash via weekly cash management bill auctions failed to prop up the rupee much,with the currency remaining at near record lows.
The rupee erased earlier gains even after the finance minister announced a slew of measures to narrow the current account deficit,as dealers cited the proposals lacked specifics.
Markets have been on a losing spree for three consecutive weeks with the benchmark index falling 6.75 percent as of Thursday’s close,as the rupee remained near record lows even after the liquidity measures taken by the RBI,while several companies reported lower-than-expected earnings.
“So far the government measures have not had any impact and further steps are needed to either curtail the current account deficit or finance it,and thereby stem the depreciation of the rupee.” said Dipen Shah,head of private client group research at Kotak Securities.
The benchmark BSE index rose 0.84 percent,or 157.64 points,to end at 18,946.98,gaining for a second consecutive session.
The broader NSE Nifty also gained 0.84 percent,or 46.75 points,to end at 5,612.40,closing above the psychologically important 5,600 level.
ITC Ltd gained 3.2 percent after HSBC upgraded the stock to “overweight” from “neutral”,while maintaining its target price of 400 rupees,citing prospects of earnings growth “resilience.”
Drugmakers climbed after reporting strong quarterly results. Sun Pharmaceutical Industries Ltd shares rose 7.1 percent after April-June earnings were seen as positive after factoring out a provisioning charge to settle a patent suit.
Cipla Ltd gained 1.5 percent after its April-June net profit rose 18.5 percent to 4.75 billion rupees.
Macquarie upgraded Cipla to “outperform” from “neutral” and raised its target price to 480 rupees from 400,saying the drugmaker’s April-June earnings were “significantly above” their estimates.
Aurobindo Pharma Ltd surged 12 percent after posting a profit of 186 million rupees for April-June compared with a loss of 1,289 million rupees in the same quarter a year earlier.
Britannia Industries Ltd ended 5.9 percent higher after earlier hitting an all-time high of 773 rupees as its July-quarter profit rose 92.53 percent to 894.9 million rupees.
Shriram EPC Ltd shares ended 3.2 percent higher after it said company agreed to sell its stake in Sree Jayajothi Cements Ltd to My Home Industries Ltd,owned by Ireland’s building materials provider CRH.
However among stocks that fell,State Bank of India (SBI),the country’s largest lender,fell 3.5 percent after it posted a second consecutive drop in quarterly net profit,missing estimates,on worsening asset quality,higher operating expenses and muted growth in interest income.
The state-run bank posted on Monday a 13.6 percent drop in net profit to 32.41 billion rupees ($532.49 million) in the fiscal first quarter that ended in June compared with 37.52 billion rupees a year earlier.
Mahindra & Mahindra Ltd shares fell 0.3 percent a day ahead of its June-quarter earnings.