Bulls ride on robust IIP data, Sensex above 19K

Major headlines

Banks gain on new capital norms

Gujarat NRE Coke spurts on fund raising plan; the stock closes 2.21% higher

ARSS Infrastructure bags Rs93.72 crore order; the stock ends higher by 0.11%



Indian indices

Bulls sustained its strong run for the fifth day in a row, with domestic indices registering another milestone today after a long weekend holiday. The Sensex touched the 19000 mark for the first time since January 18, 2008 and the Nifty above 5700 levels for the first time since January 21, 2008. Main trigger for the indices was the index of industrial production (IIP) data for July, which came in at 13.8%. The July IIP was better than the most optimistic expectation of about 8.4% at the best, and the average expectation of 7.8%. In today’s trade, magnificent rally was led by sectors like banking, oil & gas, realty and metal, especially after strong industrial output data. Even global cues were quite supportive post Europe's Basel III norms for banks and US economic data. The Nifty September futures turned into premium from 27 points discount.

Shares of India's largest bank - State Bank of India surged by 5.8% to hit the highest level in 19 years at Rs3,164.20. ICICI Bank, Housing Development Finance Corporation and Reliance Industries gained in the range of 3.5-5.3%. In midcap space, Berger Paints, BASF India, CRISIL, M&M Financial and HCL Infosystems rallied by 5-6.8%, while Shree Global Tradefin tumbled by 11%. Gujarat State Petronet, Monsanto India, IVRCL Assets and Allcargo Global fell by 2.6-3.5%.

The Sensex resumed the first day of the week 46 points higher at 18845 (day’s low). The index gathered momentum and crossed the 19000 mark in initial trades, tracking gains from the Asian markets. The index remained steady and strong throughout the morning trades, with banking stocks rallying the most. In afternoon session, the Sensex accelerated further as the European markets opened higher. In the last hour of trades, the Sensex hit the day’s high of 19243 owing to strong buying in index heavyweights.

At the closing bell, the Sensex finished the session at 19208, 409 points higher. The Nifty shut at 5760, up by 120 points.

Bond and Rupee update: India’s rupee rose to a one-month high after the government reported a bigger pickup in factory output than economists forecast, spurring demand for local
assets. India’s 10-year bonds fell the most in more than two weeks as industrial production exceeded economists’ estimates, fueling concern that the central bank will raise interest rates at a policy review this week.

Market Outlook: There are no major economic data to be released today in the US.

Market sentiment

The market breadth was constructive as gaining stocks outdid the falling ones. Out of the 3,085 stocks traded on the BSE, 1,510 advanced while 1,449 declined. Hundred and twenty-six stocks remained unchanged.

Sectoral & stock screening

All the 13 sectoral indices closed in the green. Relief in Basel III norms lifted the banking stocks, with the BSE Bankex rising to 3.62%. The BSE Oil & Gas rose by 2.57% and the BSE Realty gained by 2.46%. Rest of sectoral indices closed higher in the range of 0.48-1.59%.

Among 'A' group stocks, top three gainers - Adani Enterprises gained the most by 5.77%, followed by Kotak Mahindra Bank that surged by 5.58% and Mahindra & Mahindra Financial Services rose by 5.53%. Top three losers - Gujarat State Petronet lost the most by 3.20% on turning ex-dividend, followed by Idea Cellular that fell by 2.81% and BEML declined by 2.18%.

Viewing volumes

Leading integrated steel makers - Ispat Industries was traded the most, with over 1.54 crore shares changing hands on the BSE, followed by industrial finance company - IFCI (0.33 crore shares), India’s second largest developer - Unitech (0.32 crore shares), public sector bank - IDBI Bank (0.28 crore shares) and wind turbine major - Suzlon Energy (0.24 crore shares).

Global signals

European shares rose, with a key index hitting its highest level since April, led by banking stocks after global regulators eased the burden of the Basel III rules by giving banks a transition period to comply..

All the major Asian indices closed in the positive territory owing to strong factory data of China and Basel III norms.

The US stock index futures pointed towards a positive opening on the Wall Street today.