Monsoon forecast sends India’s equity indices soaring (Roundup)

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Mumbai, April 13 (IANS) Forecast of above average monsoon rain, along with healthy expansion in industrial production and a decline in retail inflation, sent the Indian equity markets soaring on Wednesday.

Positive global indices and a rise in crude oil prices also unleashed fresh buying of equities. Consequently, the key indices continued to zoom and ended the day’s trade on a higher note.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) closed the day’s trade higher by 142 points, or 1.84 percent, at 7,850.45 points.

Similarly, the barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 25,358.42 points, ended the day’s trade at 25,626.75 points — up 481.16 points or 1.91 percent from the previous close at 25,145.59 points.

The Sensex touched a high of 25,671.50 points and a low of 25,358.42 points during the intra-day trade.

The BSE market breadth was tilted in favour of the bulls — with 1,566 advances and 1,120 declines.

Both the indices had ended the previous two sessions on a higher note. On Tuesday, while the Sensex was up 123.43 points or 0.49 percent, Nifty edged up 37.55 points, or 0.49 percent.

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On Monday, the Sensex rose 348.32 points, or 1.41 percent, and the Nifty was up 116.20 points or 1.54 percent.

Initially on Wednesday, both the key indices opened on a firm note, in-sync with their Asian peers, rise in crude oil prices and healthy macro-economic data.

According to market analysts, fresh buying was witnessed on the back of India Meteorological Department’s forecast of above-average monsoon rains on account of receding El Nino conditions. The IMD’s predictions on monsoon came during the trading hours on Tuesday.

The IMD said that after two straight years of drought, India is likely to be showered with above-average rains during the upcoming monsoon season, with a probability of more than 94 percent precipitation.

Then, after the closing bell on Tuesday, came the twin dose of positive news from the Central Statistics Office that India’s factory output for February logged a growth of two percent after three straight months of decline, and annual retail inflation fell to 4.83 percent in March from 5.26 percent in February.

Besides, rising global crude oil prices and positive international markets cheered investors’ sentiments.

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Gains, however, were capped by unwinding of long positions ahead of the extended weekend.

The equity markets will be closed on account of Ambedkar Jayanti on April 14 and Ram Navami on April 15.

Even, the caution over the ongoing Q4 (fourth quarter) results season which started from April 8 mildly dampened sentiments. Infosys is expected to be the first bluechip firm to come out with its results on April 15.

“Several positive factors like forecast of above average rains, healthy expansion of industrial production and a decline in retail inflation have acted as triggers for the equity markets’ rise today,” Anand James, chief market strategist, Geojit BNP Paribas Financial Services, told IANS.

“Even positive global indices and rising crude oil prices supported the markets’ rise.”

Vaibhav Agarwal, vice president and research head at Angel Broking, said: “We expect markets to react to the earnings going forward, while global cues would continue to remain focused around expectations of US interest rate ahead of the FOMC (federal open market committee) meet later this month.”

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During the day’s trade, the foreign institutional investors (FIIs) and the domestic institutional investors (DIIs) were net buyers.

Data with stock exchanges showed that FIIs purchased stocks worth Rs.644.27 crore, and the DIIs bought scrip worth Rs.269.89 crore.

Sector-wise, all the 19 subs-indices of the BSE witnessed healthy buying activity. Stocks of automobile, banking, metal, FMCG (fast moving consumer goods) and capital goods sectors ended in the green.

The S&P BSE automobile index augmented by 650.47 points, followed by the banking index, which surged by 462.18 points; the metal index increased by 160.32 points; the FMCG index rose by 142.88 points; and the capital goods index gained by 128.40 points.

Major Sensex gainers during Wednesday’s trade were Mahindra and Mahindra (M&M), up 7.40 percent at Rs.1,332.60; ICICI Bank, up 5.40 percent at Rs.241; Bajaj Auto, up 4.95 percent at Rs.2,580.80; BHEL, up 4.88 percent at Rs.133.35; and Maruti Suzuki, up 4.42 percent at Rs.3,734.60.

Major Sensex losers during the day’s trade were Infosys, down 0.87 percent at Rs.1,172.05; and Adani Ports, down 0.11 percent at Rs.233.05.

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