Market sprints to life high on expectations of interest rate cut by RBI

BSE Sensex and NSE Nifty closed at record highs on Friday, buoyed by optimism that the sharp drop in crude oil prices and slower economic growth may prompt the Reserve Bank of India (RBI) to hasten interest rate cuts. 

BSE Sensex surged to 28,822 in intra-day trade before closing at 28,693 points, up 255 points or 0.90%, while NSE Nifty rallied 94 points or 1.11% to end at 8,588 points, crossing the psychological level of 8,500. Total market cap of stocks listed on BSE touched Rs 100 lakh crore on Friday.

Market participants are betting on sooner than expected interest rate cut after Brent crude prices tumbled to a 4-½ year low at $72.50 a barrel as OPEC members decided against reducing output. Meanwhile, finance minister is expected to meet RBI Governor on Monday.

NEXT WEEK EVENTS

MARKETS WILL BE FOCUS ON RBI POLICY MEET, AND THE DEVELOPMENT ON THE PARLIAMENT SESSION. 

MARKETS WILL ALSO REACT ON GDP DATA ANNOUNCEMENT, IT WAS ANNOUNCED ON FRIDAY.

INVESTORS AND MARKETS WILL KEEP AN EYE ON ONGOING PARLIAMENT SESSION, AND FURTHER POLICY ANNOUNCEMENT. 

IN THE GLOBAL MARKETS, THE EUROPEAN CENTRAL BANKS WILL MEET ON 1 DECEMBER, IT MEASURES THE ACTIVITY OF THE MANUFACTURER INDEX.

Q2FY15 GDP growth at 5.3% vs 5.7% in Q1, beats estimates

Indian economy has grown at 5.3 percent in the second quarter of the fiscal year as against 5.7 percent in the first three quarters and 5.2 percent on a year-on-year basis, the Central Statistics Office (CSO) data revealed on Friday. The GDP grew at 5.5 percent against 4.9 percent in the first half of the fiscal Y-o-Y.

Economic activities which registered significant growth in Q2FY15 over Q2FY14 are electricity, gas and water supply at 8.7 percent, construction at 4.6 percent, community, social and personal services at 9.6 percent and financing, insurance, real estate and business services at 9.5 percent.

Markets trading flat; Sun Pharma, Hero Moto top losers

 

Markets have started the trading session on a flat note with Sensex and Nifty swinging between negative and positive zone.

By 9:30, the Sensex slipped by 31 points at 27,885 mark whereas the Nifty index has gained by 20 points at 8,358 levels.

Meanwhile, the provisional data released by the stock exchanges after trading hours on Wednesday showed that foreign portfolio investors (FPIs) bought shares worth a net Rs 1030.85 crore on that day.

Larsen & Toubro, Marico, MMTC, Neyveli Lignite Corporation, Novartis India, Sun TV Network, Syndicate Bank, UCO Bank, Chambal Fertilisers & Chemicals, Engineers India, Essar Oil and Jet Airways (India) will announce their July-September 2014 results today.

GLOBAL MARKETS

Asian shares edged down on Friday ahead of U.S. employment data later in the session, while the euro wallowed around two-year lows after European Central Bank President Mario Draghi vowed to take more easing steps to spark growth in the euro zone.

Investors were likely to remain cautious ahead of the key U.S. nonfarm payrolls report. Solid gains in employment would increase speculation that the U.S. Federal Reserve could raise U.S. interest rates in the middle of next year.

MSCI's broadest index of Asia-Pacific shares outside Japan was down about 0.3%, on track for a weekly loss of about 1.7%.

Japan's Nikkei stock average rose 0.4%, poised to gain over 2% for the week following the Bank of Japan's surprise easing move on Oct 31.

US stocks edged up in a volatile session on Thursday, with the Dow and S&P 500 hitting fresh record closing highs on an indication that the European Central Bank would take more policy action if needed to boost a struggling euro zone economy.

ECB President Mario Draghi indicated support for additional measures to bolster the euro zone economy if necessary and said the ECB governing council was unanimous in its commitment to using unconventional measures.

The Dow Jones industrial average rose 69.94 points, or 0.4%, to 17,554, the S&P 500 gained 7.64 points, or 0.38%, to 2,031 and the Nasdaq Composite added 17.75 points, or 0.38%, to 4,638.

SECTORS & STOCKS

BSE Realty index has surged by almost 2% followed by counters like Capital Goods and FMCG, both gaining by nearly 1%. However, BSE Healthcare index has declined marginally.

The main gainers on the Sensex are Tata Motors, Cipla, Tata Steel, Axis Bank and Hindalco, all gaining between 1-2%.

On the losing side, Sun Pharma, Hero Moto, M&M, GAIL and Coal India have slipped between 1-3%.

Ranbaxy has slipped by over 4% as the US health regulator has revoked its tentative approvals for its generic anti-viral drug and stomach and esophagus problems treatment tablets.

Hero Moto has dipped by almost 2%. After selling shares of Rs 1,480 crore in Hero MotoCorp, private equity company Bain Capital is set to sell $200-million shares (2.2 per cent). Bain will sell nearly 4.3 million shares in India's biggest maker of motorcycles and scooters for Rs 2,859.6-2,963 apiece, according to the term sheet.

Among other shares, Ashok Leyland is trading higher by 3% to Rs 48 after reporting a standalone net profit of Rs 121 crore for the second quarter ended September 2014 (Q2), on back of better sales and one-time gain of Rs 109 crore due to profit on sale of immovable assets. Excluding an one-time item, net profit stood at Rs 12 crore.

The broader markets are outperforming the benchmark indices- BSE Midcap and Smallcap indices have gained between 0.4-1%.

The market breadth in BSE remains positive with 952 shares advancing and 503 shares declining.