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Wednesday, January 27, 2016

Pre Session- Gap up opening on the cards for Sensex despite China rout

The key domestic equity benchmarks are poised to extend a two-day rally on Wednesday as traders look past an ongoing China stock slump while eying key corporate earnings and the US Federal Reserve’s verdict with the world’s top central bank likely to hold off further interest rate tightening, bolstering the lure for risky assets. A bullish trend across most Asian equities and a strong finish at Wall Street overnight, coupled with gains in the CNX Nifty Index futures for January delivery which advanced by 0.56 per cent or 41.5 points at 7,437 at 10:26 am Singapore time signals a positive opening for Dalal Street today. Traders will focus on the December quarter earnings of HDFC, IDFC Bank, Havells and Godrej Consumer Products set to be unveiled on Wednesday. However, volatility may remain high at the domestic bourses as traders roll over their positions ahead of the January futures and options (F&O) contracts expiry on Thursday. Globally, all eyes will be fixated on the Fed which concludes a two-day meeting later on Wednesday. While the Fed is likely to keep interest rates unchanged after undertaking a maiden interest rate hike since 2006 in December, investors will focus on cues from the central bank over further lift-off in borrowing costs this year amidst heightened global economic uncertainty. Marking a second straight rally, on Monday the 30-share Sensex advanced by 50.29 points or by 0.21 per cent to end at 24,485.95 on strong global cues but gains were limited amidst comments from top rating agency Moody’s which in a poll warned of the risks facing the Indian economy from global headwinds such as higher US interest rates and China slowdown. Markets were closed on Tuesday on account of Republic Day.

Most Asian stocks were trading higher on Wednesday tracking an overnight rally in US markets as investors awaited the outcome of the US Fed meet. China’s Shanghai Composite extended a rout from a 13-month low, tumbling over 2 per cent after data showed that the country’s industrial profits fell 4.7 per cent in December 2015 from the same month a year ago, raising concerns over a slowdown in the world’s second biggest economy. Hang Seng surged over 1 per cent and Japan’s Nikkei 225 rallied over 2 per cent amidst speculation that the Bank of Japan which meets on Friday may take a call to expand stimulus. US stocks advanced on Tuesday as a rally in crude oil, strong corporate earnings and upbeat US economic data overshadowed worries over China. The Dow Jones Industrial Average advanced 1.78 per cent; the Nasdaq Composite rose 1.09 per cent while S&P 500 closed up 1.41 per cent. While a gauge measuring US consumer confidence rose to the highest level in three months at 98.1 in January from 96.3 in December, home prices in 20 cities advanced at the fastest pace since July 2014, up 5.8 per cent, year on year in November 2015, easing worries over a slowdown in the world’s biggest economy, buoying sentiment.

Top traded Volumes on NSE Nifty – Vedanta Ltd. 18539818.00, State Bank of India 17534650.00, ICICI Bank Ltd. 15579335.00, Axis Bank Ltd. 10252421.00 and Cairn India Ltd. 9123526.00.

On BSE, total number of shares traded was 26.04 Crore and total turnover stood at Rs. 2615.35 Crore.

On NSE Future and Options, total number of contracts traded in index futures was 407756 with a total turnover of Rs. 21632.15 Crore. Along with this total number of contracts traded in stock futures were 1202869 with a total turnover of Rs. 54808.10 Crore. Total numbers of contracts for index options were 4997046 with a total turnover of Rs. 274362.59 Crore and total numbers of contracts for stock options were 339671 with a total turnover of Rs. 16252.70 Crore.

The FIIs on 25/01/2016 stood as net seller in equity and debt. Gross equity purchased stood at Rs. 3930.43 Crore and gross debt purchased stood at Rs. 1176.09 Crore, while the gross equity sold stood at Rs. 4663.85 Crore and gross debt sold stood at Rs. 1783.12 Crore. Therefore, the net investment of equity and debt reported were Rs. -733.42 Crore and Rs. -607.03 Crore.