Sensex gets a Greece booster, ends 300 points higher; IT, oil & gas shares sizzle

A smart recovery in equity markets in the afternoon trades buoyed by news that the debt-laden Greece has reached a deal with its European creditors thus avoiding an exit from the euro triggered renewed optimism amongst investors in the global markets, including India, and helped push the benchmark Sensex above the 28,000-mark to the day’s high of 28,005.17, up 344 points. Extending gains for the second straight session, the 30-share S&P BSE Sensex ended at 27,961.19, up 299.79 points, or 1.1 percent from previous close. The broader 50-share CNX Nifty closed at 8,459.65, up 99.10 points, or 1.2 percent. [caption id=“attachment_2340232” align=“alignleft” width=“380”]  Reuters[/caption] Market breadth ended positive with 1,789 stocks advancing against 1,005 declines on BSE. In fact, markets displayed a dull trading session in the first half and the Sensex slipped to the day’s low of 27,635.06, down 26 points, before staging a smart bounce back after the Greece announcement came to the fore. The deal calls for Greeks, already reeling from harsh measures and economic decline, to cut back even further in exchange for more loans without which its financial system would surely collapse. The deal, which still needs approval from Greece’s parliament, will be the country’s third bailout in five years. The deal includes commitments from Greece Prime Minister Alexis Tsipras to push a drastic austerity program including pension, market and privatization reforms through parliament by Wednesday. “There was a huge sentimental impact on the markets today. The Greece deal will bring some stability to the currency markets, as any adverse decision would have created lot of volatility in the European currency markets and could have led to fresh uncertainty in global markets,” said KR Choksey, CEO & managing director, KR Choksey Shares and Securities. For India, domestic factors will set the tone for the markets going ahead, as investors would focus on regular monsoon updates, key reforms to be discussed in the Monsoon Session of Parliament and the earnings season, said Choksey. As markets rebounded sharply from its early sluggish session, investors also lapped up IT, healthcare and oil stocks. Among the gainers, GAIL shot up 3.6 percent to Rs 373.35, HDFC gained 3.2 percent to Rs 1,323.85, NTPC jumped 2.5 percent to Rs 133.10 and Hindalco was up 1.9 percent at Rs 106.55. In the IT space, shares of Wipro rose 2.1 percent to Rs 560, TCS added 1.5 percent to Rs 2,508.60 and Infosys was up 1.4 percent at Rs 950.05. Other oil stocks such as BPCL gained 3 percent to Rs 907.85, HPCL moved up 2.2 percent to Rs 820.15 and IOC was up a percent at Rs 424.40. Shares of Cairn India, Reliance Industries and Oil India also clocked gains. Shares of companies having business interest in Euro zone also logged gains after clarity on the Greece deal. Shares of Motherson Sumi Systems jumped nearly 5 percent to Rs 528.75, Bharat Forge rose 4.6 percent to Rs 1,123.35, Cox & Kings moved up 4.2 percent to Rs 277.70 and Cummins India gained 1.9 percent to Rs 967.60. However, capital goods shares were the laggards following a disappointing performance from the segment in the recently released May IIP numbers. As per the data released by the government on Friday post market close, capital goods segment grew at a dismal 1.8 percent in May compared with 6.8 percent in April, an indication that revival in investments has been inconsistent. Shares of Thermax, L&T, Pipavav Defence and Offshore Engineering and Havells India ended around percent lower.