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Sensex up over 150 pts, Nifty above 8650; BHEL, ITC gain


The News International Team

9:55 am Market guru: Indian equities have shown some signs of struggle recently, with the Nifty coming off a top of about 9,100 to nearly 8,650 in 15 days. The outlook for the medium term – from now till about October – looks clouded as “headwinds have been growing while tailwinds are reducing”, CNBC-TV18 consulting editor Udayan Mukherjee said in an interview. The veteran anchor and financial journalist said that in the wake of earnings not picking up as much as earlier thought and with valuations continuing to remain slightly uncomfortable, the Nifty could stay in a 8,500-9,100 range in the medium term.

9:40 am FII view: Brokerage house Bank of America Merrill Lynch feels India is vulnerable to a near term global correction as too many global fund managers own shares in this market. “One of our near term concerns has been that investors are very overweight India; this makes India vulnerable to any near term global correction,” says the Merrill Lynch note, adding that a macro recovery appears to be some way off. “While we are structural bulls on India with an index target of 54,000 by end-2018, we have been highlighting that we see the market being range-bound to negative over next few months,” the note further says.

9:30 am Buzzing:Shares of Zee Media Corporation rose over 3 percent intraday on fund raising plans via rights issue. The board of directors has approved proposal for rights issue to raise Rs 195.59 crore.

“The board of directors of the company at its meeting held on March 16, 2015, has approved the letter of offer for the proposed rights issue of up to 1,08,643,732 equity shares of Re, 1 each of the company at the issue price of Rs 18 per Share (including premium of Rs17 per share) aggregating to Rs 195.55 crore,” it said in a statement to the BSE.

The rights issue will open on March 25 and close on April 08.

Don’t miss: Bank of Japan to maintain aggressive stimulus, recovery view

The market has opened strong following global cues. The Sensex is up 196.45 points or 0.6 percent at 28634.16, and the Nifty up 55.95 points or 0.6 percent at 8689.10. About 412 shares have advanced, 65 shares declined, and 89 shares are unchanged.

BHEL, Dr Reddy’s Labs, Sesa Sterlite, ITC and Tata Power are top gainers in the Sensex. Among the losers are Cipla, Infosys and NTPC.

The Indian rupee opened marginally higher at 62.77 per dollar on Tuesday versus 62.81 Monday.

The dollar fell across the board, as investors worry that the greenback’s rapid rise could prompt the Federal Reserve to be a little more cautious about raising interest rates this year.

The dollar is up 24 percent against a basket of currencies since May and it could become a key issue at this week’s Fed monetary policy meeting

Ashutosh Raina of HDFC Bank said, “The dollar continues to remain the theme with the dollar index hovering around the 100 mark. The rupee has been a relative outperformer moving in 62.50-63.00/dollar range. We expect the rupee to continue trading in this range with a weakish bias.”

Markets in the US closed more than 1 percent higher as investors cheered a pause in the dollar rally and eyed renewed weakness in oil prices ahead of Wednesday’s key Fed meeting.

The Fed’s policy committee will convene for its monthly two-day policy meeting today and a statement will be released on Wednesday night.  Markets will be watching whether the central bank will eliminate the “patient” promise in its post-meeting statement, paving the way for an interest rate hike this year.

In Europe, equities finished higher as investor sentiment continued to be positive on the back of the extra liquidity provided by the European Central Bank (ECB) in the region.

In commodities, NYMEX crude is at a six-year low on signs of higher output in the US and Libya and a possible nuclear deal that could end sanctions for Iran, allowing more of its oil into the market.

From precious metals space – gold prices continue to trade near 3 month lows of USD 1150 an ounce.

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