Sensex cracks double ton…RIL spurts 5%

Indian stocks kicked off a new trading week with solid gains, with the NSE Nifty closing in on the 5,300 milestone. The BSE Sensex rose by over 200 points. The Nifty and the Sensex both advanced by ~1% each. However, the broader indices could not quite capitalise on the good early start and retreated from the day’s highs. The market breadth was still positive. Oil & Gas, Auto, Banking, Capital Goods and Realty sector indices paced the rally today while sectors such as IT and FMCG were the biggest laggards. The undercurrent across Asian markets was buoyed by Friday's strong gains on Wall Street and the European markets. The trigger for the advance in the US and European markets on Friday was a stronger-than-expected jobs data, besides growing speculation of fresh monetary stimulus. The Sensex ended at 17,412, gaining by 215 points or 1.2% over the previous close. It had earlier touched a day’s high of 17,451 after opening at a day’s low of 17,313. The NSE Nifty settled at 5282, up 67 points or 1.2%. It touched a day’s high of 5,293 and a day’s low of 5,260. The INDIA VIX on NSE was up 0.6% at 16.22. It hit a day’s high of 16.51 and a day’s low of 15.58. The broader markets under-performed the large caps, with the BSE Small Cap index up 0.8% and the BSE Mid Cap index gaining 0.5%. Most sectoral indices ended in the green. Pacing the gains was the Oil&Gas index, up 3% aided by Reliance Industries. Auto, Bankex, Capital Goods, Realty and Metals among others were the other notable gainers. FMCG was the only major declining index, down 0.4%. IT and Teck indices were largely unchanged. RIL, Tata Motors, JP Associates, GAIL, Kotak Mahindra Bank, Axis Bank, DLF, HDFC Bank, R Infra, Bajaj Auto, Tata Steel, BHEL, Sterlite Inds, L&T, Sun Pharma, ICICI Bank, and HDFC were among the notable leaders on the Sensex and the Nifty. BPCL, Wipro, Dr.Reddy’s Labs and TCS were the notable losers on both the indexes. On the BSE-500 index, Reliance Industrial Infrastructure, Puravankara Projects, SKS Microfinance, Balrampur Chini Mills, Anant Raj Inds, JK Lakshmi Cement, Fresenius Kabi, Gammon India, Bombay Dyeing and REC were the top gainers. DB Corp, MVL and Glodyne Technoserve were the noteworthy losing stocks in the BSE 500 index. Reliance Industries Ltd. (RIL) shares surged by over 5% to a three-month high today after the company agreed to share KG-D6 accounts with the CAG under the terms of the production sharing contract (PSC) ahead of a crucial meeting of the block's management committee. RIL closed above its 200-DMA of Rs 760. On the other hand, BPCL was the only noteworthy loser in the Nifty. The stock was down 3%. The Indian rupee touched its highest level in more than a week, as a stronger-than-expected US monthly jobs report improved global risk tolerance. However, appreciation in the rupee is likely to be capped by lingering concerns about India’s decelerating growth, high inflation and widening twin deficits. Foreign institutional investors (FIIs) poured in a net of Rs. 35.87bn last week, according to SEBI data, their biggest purchases since the week ending July 6. FIIs bought a net of Rs. 102.73bn in July, their biggest purchases since February. Foreign inflows into Indian equities so far in 2012 now stand at a net Rs 522.66bn. European indices notched modest gains after a cautious start. Asian stock indices ended higher on Monday, as investors welcomed a better-than-expected US jobs data and signs of progress in talks between international creditors and Greek officials. Indian stocks are exhibiting early signs of a bull market, Morgan Stanley said in a note dated August 3, though they are not quite there yet. Three conditions will be critical for the Indian markets: a bullish steepening of the yield curve, expanding profit margins and attractive valuations. Of these, the spread between the 10-year bond yield and the 91-day treasury-bill is already reversing its steep inversion, Morgan Stanley said. It sees Indian stock valuations as "attractive." "Profit growth is also in a period of mild recovery," Morgan Stanley added, though it does not believe that a full-blown margin expansion cycle is on hand. Shares of Parsvnath Developers, Glodyne Technoserve and Pipavav Defence today fell sharply following market regulator SEBI's move to bar 19 entities for manipulation in stock prices of the three companies. SEBI had also found manipulation in Tulip Telecom shares. SEBI on Friday barred 19 entities, including three individuals, from the securities market till further orders after an initial probe into the July 26 plunge in the four mid-cap stocks. Shares of Indian units of many MNCs surged on expectations that these companies might be delisted from the Indian stock markets after SEBI refused to extend its deadline for meeting a minimum public shareholding of 25% in these companies. BOC India, Singer India, Sharp India, Honeywell Automation India, Fresenius Kabi Oncology, Astrazeneca Pharma India and Oracle Financial Services Software were among the top gainers. In addition, Elantas Beck India, Wendt India, Kennametal India, Fairfield Atlas and Timken India also climbed on the BSE.