The key benchmark indices pared gains after hitting fresh intraday highs in early afternoon trade. The BSE 30-share Sensex was up 170.67 points or 1.01%, off close to 40 points from the day’s high. Firm Asian stocks also supported the domestic bourses. Data showing a stronger-than-expected industrial production growth in April 2010 also underpinned sentiment. FMCG and IT stocks rose. Index heavyweight Reliance Industries (RIL) jumped. But, telecom stocks fell. The market breadth was strong.
The BSE Sensex regained the psychological 17,000 mark at the onset of the trading session on firm Asian stocks. The market held firm in morning trade. The market extended gains in mid-morning trade on reports of strong industrial production growth in April 2010. The market pared gains in early afternoon trade.after hitting fresh intraday high.
Industrial output rose much faster than expected at 17.6% in April 2010 from a year earlier on strong consumer demand and government spending, data released by the government today showed. The March’s annual growth rate was revised upwards to 13.9% from 13.5%. Manufacturing output rose 19.4% in April 2010. The industrial output rose 10.4% in the 2009/10 fiscal year (April-March), faster than the 2.6% clocked in the previous fiscal year.
Asian stock markets rose Friday, buoyed by optimism that the global economy could weather Europe’s debt crisis after China’s exports surged and U.S. jobless claims fell. The key benchmark indices in Japan, China, South Korea, Indonesia, Hong Kong, Taiwan and Singapore rose by between 0.42% to 1.7%.
Latest data showed China’s consumer inflation accelerated to a 19-month high in the year to May while industrial output and fixed-asset investment growth moderated, sending mixed signals about the state of the world’s third-largest economy.
US index futures reversed initial losses. Trading in US index futures indicated that the Dow could rise 3 points at the opening bell on Friday, 11 June 2010.
US Stocks jumped on Thursday in response to signs of health in the euro debt markets and as investors accumulated energy shares crushed in the previous day’s sell-off. The Dow Jones Industrial Average jumped 273.28 points, or 2.76% to 10,172.53. The Standard & Poor’s 500 Index rose 31.15 points, or 2.95% to 1,086.84. The Nasdaq Composite Index gained 59.86 points, or 2.77% to 2,218.71.
A US government reported before the opening bell that the number of new filings for unemployment benefits fell less than expected last week, while the international trade deficit widened slightly in April, pointing to a moderate economic recovery.
Back home, on the macro front, the food price index rose 16.74% in the year to 29 May 2010, higher than the previous week’s annual reading of 16.55% as fruits and potato prices rose, data released by the government on Thursday, 10 June 2010, showed. The fuel price index climbed 14.23% compared with an annual rise of 14.14% in the previous week.
India’s monsoon delivered normal rainfall in the past week, the India Meteorological Department (IMD) said on 10 June 2010. Rainfall in the seven days to 9 June 2010 recovered to normal after an initial hiccup when cyclone Phet hindered the advance of the June-September monsoon, which irrigates 60% of farms in India. The IMD in its update on Thursday said Southwest monsoon has advanced into some parts of Konkan & Goa, south Madhya Maharashtra and north interior Karnataka, remaining parts of coastal and south interior Karnataka, some more parts of Rayalaseema and coastal Andhra Pradesh.
The June-September monsoon rains hit Kerala on 31 May 2010, a day ahead of schedule. The south-west monsoon usually covers the entire country by mid-July. The weather office late April 2010 said rainfall is likely to be 98% of the long-term average. Good monsoon rains would help raise farm output, boost rural incomes and lower food inflation.
Last month, Australia’s weather bureau said the El Nino weather pattern was over. El Nino is caused by an abnormal warming of the eastern Pacific Ocean and can play havoc with weather patterns across the Asia-Pacific region
The south west monsoon is important for India as about 60% of the country’s farmlands are rain-fed and more than half of the workforce is employed in the agriculture sector. The quantum of rainfall in the crucial sowing month of July and distribution of rainfall during the monsoon season also holds key.
Data last week showed business activity remained strong for India’s vast services sector in May 2010, with a key gauge growing for a 13th consecutive month even as some momentum was lost over the previous month. The HSBC-Markit Business Activity Index stood at 58.2 in May 2010 from a 21-month high of 62.1 in April 2010. A reading above 50 indicates expansion. Services make up about 55% of India’s $1.2 trillion economy.
HSBC Markit Purchasing Managers’ Index (PMI), based on a survey of 500 Indian firms, surged to a 27-month high of 59 in May 2010 from 57.2 in April 2010, bolstered by steady growth in output, new orders and employment. The rate of growth had slowed in March 2010 and April 2010.
India’s economy grew at 8.6% in the March 2010 quarter driven by robust manufacturing sector on the back of government and consumer spending, data released by the government on Monday, 31 May 2010, showed. The growth was significantly higher than the revised 6.5% expansion in Q3 December 2009 and a 5.8% growth in Q4 March 2009. The manufacturing sector grew 16.3%, farm output rose 0.7%, mining sector expanded 14% and services increased by 8.4% in January-March 2010 quarter from a year earlier.
For the full year to March 2010, the economy expanded 7.4%, above a government forecast of 7.2%. Economic growth had slowed down to 6.7% in year ended March 2009.
HSBC Markit Purchasing Managers’ Index (PMI), based on a survey of 500 Indian firms, surged to a 27-month high of 59 in May 2010 from 57.2 in April 2010, bolstered by steady growth in output, new orders and employment. The rate of growth had slowed in March 2010 and April 2010.
India’s economy grew at 8.6% in the March 2010 quarter driven by robust manufacturing sector on the back of government and consumer spending, data released by the government on Monday, 31 May 2010, showed. The growth was significantly higher than the revised 6.5% expansion in Q3 December 2009 and a 5.8% growth in Q4 March 2009. The manufacturing sector grew 16.3%, farm output rose 0.7%, mining sector expanded 14% and services increased by 8.4% in January-March 2010 quarter from a year earlier.
For the full year to March 2010, the economy expanded 7.4%, above a government forecast of 7.2%. Economic growth had slowed down to 6.7% in year ended March 2009.
Investors will eye the first installment of the corporate advance tax payment which will give some clue about Q1 June 2010 corporate results. The first installment of corporate advance tax falls due on 15 June.
Meanwhile, the Union Cabinet on Thursday deferred a decision to sell stake in state-run Coal India and miner Hindustan Copper.
At 12:20 IST, the BSE 30-share Sensex was up 170.67 points or 1.01% to 17,092.75. The Sensex rose 209.48 points at the day’s high of 17131.56 in mid-morning trade. The Sensex rose 71.99 points at the day’s low of 16,994.07 in early trade.
The S&P CNX Nifty was up 44.70 points or 0.88% to 5123.30.
The BSE Mid-Cap index rose 0.51%. The BSE Small-Cap index rose 0.81%.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1824 shares advanced as compared with 819 that declined. A total of 100 shares were unchanged.
From the 30 share Sensex pack, 26 rose and rest fell.
Index heavyweight Reliance Industries (RIL) rose 2.31%, with the stock gaining for the third straight day. RIL announced during market hours today its sixth oil discovery in exploratory block in the Cambay basin in Gujarat.
Meanwhile, RIL is reportedly considering buying a stake in shale gas assets owned by Pioneer Natural Resources in the United States. Pioneer has about 310,000 acres of shale gas acreage in the Eagle Ford region in South Texas.
Recently, reports had suggested RIL may foray into various fields such as telecommunications sector, nuclear energy and may make its first big-ticket investment in coal-fired power plants. In May this year, the two Ambani brothers, Mukesh and Anil called off their non-compete agreements on all businesses other than gas-based power, enabling Mukesh Ambani to enter in these spheres
Reliance Infrastructure fell 0.83%, on profit taking after the stock rose 5% on Thursday. Reliance Power’s wholly owned unit Reliance Coal Resources has entered into share purchase agreements to acquire the entire stake in the two coal companies in Indonesia. The two Indonesian companies own three coal-mines in Indonesia. The coal from these mines will be used in the Krishnapatnam ultra mega power project and other power projects of the group, Reliance Power said on Thursday. Reliance Infrastructure holds 44.96% stake in Reliance Power (as on 31 March 2010).
India’s largest listed mobile telecom services provider by sales Bharti Airtel fell 1.96% on profit taking. Bharti Airtel has reportedly won broadband spectrum in four circles. The Bharti Airtel stock had surged sharply over the past two trading sessions after company announced the completion of the acquisition of Zain Group’s (Zain) mobile operations in 15 countries across Africa for an enterprise valuation of $10.7 billion.
India’s second largest listed mobile telecom services provider by sales Reliance Communications fell 0.89%. India’s third largest listed mobile telecom services provider by sales Idea Cellular fell 0.54%
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