The market extended rally for second consecutive session Tuesday, tracking positive global cues. Relief rally in FMCG, metals and select banking & financials helped the 30-share BSE Sensex close 104.37 points higher at 25864.47.
The 50-share NSE Nifty failed to hold 7850 due to selling in Infosys and Reliance Industries. It rose 30.95 points to end at 7837.55 after hitting an intraday high of 7860.45. The broader markets also gained in line with benchmarks as the BSE Midcap and Smallcap indices were up 0.3-0.5 percent.
India is in a sweet spot when compared with other emerging markets considering its macros are improving, says Mahesh Nandurkar of CLSA.
There is a sense of disappointment in terms of corporate earnings, but silver lining at the moment is that domestic investors are willing to take a long-term view on India, he adds.
Anish Damania, CEO, IDFC Securities expects the Nifty to hit 9250 within a year.
Asian (barring China) and European markets gained strength today, taking positive lead from Wall Street. In Asia, Hang Seng, Nikkei, Kospi and Taiwan Weighted closed 1-1.5 percent higher. In Europe, France’s CAC rallied 2 percent followed by Britain’s FTSE and Germany’s DAX with 1.7 percent upside (at 16 hours IST).
Infosys declined more than 1.8 percent on margin warning for second half of FY16. In a conference call yesterday, the company says it expects Q3 to be soft but is confident of coming back to growth in Q4. However, HCL Technologies was up 1.4 percent on bagging application development & maintenance services contract from Deutsche Bank.
Metals continued to see buying interest with the NSE Metal index rising 1.1 percent. Hindalco Industries, Tata Steel and Vedanta were up 2-2.7 percent.
ITC remained leading contributor to Sensex’s gains, up 2.9 percent today in addition to 2.7 percent upside in previous session.
Tata Motors was up 1.8 percent as sources told CNBC-TV18 that the company is expected to adopt a new passenger vehicle strategy to boost sales. The steering committee headed by Cyrus Mistry has cleared a three-pronged strategy, which Tata Motors is hoping will revive its fortunes in the car business.
GAIL topped buying list on Sensex, up 4 percent followed by HDFC, Sun Pharma and HUL with more than 1.5 percent upside. Axis Bank, Reliance Industries, Dr Reddy’s Labs, Lupin, Bajaj Auto and Hero Motocorp were down 0.5-1.7 percent.
In broader space, sugar stocks like Shree Renuka Sugars, Rana Sugars, Uttam Sugar, Mawana Sugars, Dharani Sugars and EID Parry gained 9-20 percent after sources told CNBC-TV18 that the government is considering subsidy on cane prices and subsidy is likely to be around Rs 4.75 per quintal.
Tobacco stocks saw huge buying interest as Godfrey Phillip, VST Industries and Golden Tobacco surged 7-20 percent. In tyre stocks, CEAT, Apollo Tyres and MRF gained 3-7 percent.
The market breadth remained positive as about 1400 shares advanced against 1291 declining shares on the Bombay Stock Exchange.