The BSE Sensex today posted its biggest daily percentage gain in a month, as blue chips rallied tracking widespread gains in global risk assets on hopes for monetary stimulus in the eurozone and the United States.
Stock markets staged huge confidence, ahead of the crucial Reserve Bank of India’s quarterly monetary policy review, led by the strong buying in interest rate sensitive’s Realty, Bankex and high beta Power and Capital Goods counters. Amassing gains steadily, equity markets after vehemently rallying over a percentage points, concluded near the high point of the session.
While the BSE benchmark index gained 300 points or 1.77 percent to 17137.14, the NSE Nifty rallied 100 points to end the day at 5,200.05.
ICICI Bank added 3.78 percent, rising for a second consecutive session after its better-than-expected April-June results on Friday.
Engineering and construction major Larsen & Toubro and power equipment manufacturer BHEL were up 3.6 percent and 4 percent, respectively. Reliance Infrastructure and Jaiprakash Associates gained 5 percent Power producers Tata Power and NTPC went up 2.7-3.7 percent.
All eyes will be on the Reserve Bank of India’s monetary policy meeting tomorrow with expectations of a 25 basis points cut in the CRR. It remains to be seen if the apex bank in India obliges the markets with a rate cut amid sticky inflation, slowing growth, policy inaction, and more recently, an unfavorable monsoon.
On Wednesday, the US Fed’s open market committee will meet while on Thursday the European Central Bank’s rate and monetary policy meeting will take place.
On the global front, positive opening of European markets provided the required fillip to the equity markets, on hopes for more central bank stimulus measures in Europe and the United States to help global economic growth. Asian pacific shares too shut shop in green.
Domestically, a slew of upbeat earnings in the banking space, also excited the markets, besides the banking gauge on BSE.
Meanwhile, total rainfall so far this season is 20 percent below the long-period average. The monsoon’s slow progress across the country has heightened concerns that output of summer-sown crops such as oilseeds, sugar and pulses may fall.
A ministerial panel may soon review the drought-like situation in the country. Rainfall progress will remain under scrutiny by investors in the near future.
The manufacturing Managers’ Index (PMI) for July 2012 will be out 1 August 2012. The services purchasing managers’ index for July 2012 is expected to be released in early August 2012.
Stocks in news
Public sector lender Allahabad Bank shot above 5 percent on reporting a 23 percent jump in the April-June quarter of 2012 net profit at Rs 514 crore due to lesser provisions.
Bank of Baroda’s scrip rose over 3 percent on reporting a rise of 10 percent in its Q1FY13 net profit at 1,139 crore on the back of strong fee income.
Additionally, Oriental Bank of Commerce too shot over 9% at Rs 228 after reporting a better-than-expected net profit of Rs 391 crore for the quarter ended June 2012, on the back of higher other income and lower provisioning.
However, Spicejet by spurting over 20%, took markets by surprise. After being in the red for five consecutive quarters, Spicejet flew back into black, reporting a net profit of Rs 56 crore in the June quarter as against a loss of Rs 71.96 crore a year ago.
DLF rose 1.2 percent on reports that the company was to sell its 17.5-acre land in Lower Parel, Mumbai to Lodha Group and a PE firm for Rs 2700-2800 crore.
Godrej Properties advanced after its 1Q group net income spiked 71% YoY to Rs 17. crore.
IRB Infrastructure advanced after its 1Q net income climbed 6% on year to Rs.1.42bn beating analyst estimates of Rs.1.12bn.
REC gained after its 1Q net income rose 32% from the same period a year ago to Rs 877 crore, beating analyst estimates of Rs 778 crore.