Healthy macro data buoys markets; Sensex gains over 240 points

Mumbai, July 1 : A slew of positive macro economic data coupled with factoring-in of the Greek loan default led Indian equity markets to make healthy gains during the trading session on Wednesday. A barometer of the Indian equity markets, the sensitive index (Sensex) of the Bombay Stock Exchange (BSE), closed with gains of more than 240 points. The wider 50-scrip Nifty of the tiol Stock Exchange (NSE) also closed in the positive territory with healthy gains. It edged up 84.55 points or 1.01 percent at 8,453.05 points. The 30-scrip S&P BSE Sensex, which opened at 27,823.65 points, closed the day’s trade at 28,020.87 points, up 240.04 points or 0.86 percent from its previous day’s close at 27,780.83 points. The Sensex touched a high of 28,099.25 points and a low of 27,799.91 points in the intra-day trade.

Alysts observed that Wednesday’s gains came on the back of healthy macro economic data like the growth in eight core industries and the increase in the government’s expenditure which was revealed from the fiscal deficit numbers. “There were couple of macro data which presented good growth prospects. Like the fiscal deficit data that showed that the government expenditure and capex has taken off, the eight core industry data also showed growth,” said And James, co-technical head for research with Geojit BNP Paribas.

“Good news about a normal monsoon in July and the hope that the Greece crisis would be resolved soon, as both creditors and the Greek government now seem to make concessions, buoyed the markets,” James added. On Tuesday, official data showed that India’s fiscal deficit in the first two months (April-May) of the current fincial year touched Rs.208,624 crore, or 37.5 percent of the target 2015-16.

Another set of data showed that a major index for select factory output jumped by 4.4 percent in May from a decline of 0.4 percent in the month before due to healthy rise in coal, electricity and refining production. The eight core industries which comprise 38 percent of the total weight of items included in the Index of Industrial Production (IIP) stood at 178.6 from 162.4 in April. On Tuesday, the Sensex had closed 136 points or 0.50 percent up, outperforming despite anxiety about Greece defaulting on its Intertiol Monetary Fund (IMF) loan repayment.

“Going ahead, the progress of monsoon, as well as quarterly results will play an important part in deciding the movement of the markets. Equally important will be the progress of important reforms bills in the monsoon session of parliament,” said Dipen Shah, head- private client group research, Kotak Securities. During Wednesday’s intra-day, 11 out of the 12 sector-based indices of the BSE ended in the positive territory. Healthy buying took place in bank, capital goods, automobile, information technology (IT), metal, healthcare, oil and gas, consumer durables and technology, entertainment and media (TECK) sectors. The S&P BSE bank index shot up by 342.28 points, capital goods index jumped by 296.82 points, automobile index gained 248.64 points, IT index augmented by 154.67 points, and metal index rose by 102.12 points.

The S&P BSE healthcare index increased by 99.13 points, oil and gas index edged higher by 88.55 points, consumer durables index gained by 76.12 points and TECK index was up 75.13 points. However, the fast moving consumer goods (FMCG) index ended 27.77 points lower. The major Sensex gainers in Wednesday’s trade were: BHEL, up 3.67 percent at Rs.256.95; Axis Bank, up 3.60 points at Rs.578.75; Cipla, up 2.75 percent at Rs.633.25; Tata Motors, up 2.36 percent at Rs.444.80; and State Bank of India (SBI), up 1.83 percent at Rs.267.60.

The major Sensex losers were: Lupin, down 0.48 percent at Rs.1,877.70; Bajaj Auto, down 0.48 percent at Rs.2,523.60; ITC, down 0.41 percent at Rs.313.75; Gail, down 0.40 percent at Rs.390.50; and HDFC, down 0.27 percent at Rs.1,292.95. Among the Asian markets, Japan’s Nikkei gained by 0.46 percent, however, Chi’s Shanghai Composite Index dipped-lower by 5.23 percent. Hong Kong’s Hang Seng increased by 1.09 percent. In Europe, the London FTSE 100 index gained by 1.30 percent, the French CAC 40 was higher by 2.36 percent and Germany’s DAX Index rose by 1.92 percent at the closing bell here. (IANS)