Expect Market To Continue With Its Momentum
The BSE Sensex breached the 27,000-mark for the first time to hit a record high of 27,082.85 points on yesterday after recent data raised hopes about the economy. The achievement of historical high was entirely led by heavyweights like HDFC twins, ITC, Reliance Industries and Bharti Airtel, though selling in ICICI Bank and Tata Motors capped the somewhat upside.
Yesterday, massive buying activity was seen in cement stocks on the back of higher growth in cement sector (at 16.5% in July versus 13.6% in June) among eight infrastructure sectors. Grasim Industries, ACC and Ambuja Cements rallied 3-4%. However, metal stocks fell on continued worries around pending top court's hearing on September 9 about whether to cancel the allocations of coal blocks it ruled as illegal last week. Balance of payments was in surplus for a third straight quarter, while current account deficit widened but stayed within comfort which also help to gains the market on Tuesday. Japan has promised $33.58 billion investment for infrastructure projects, including building smart cities and help in introduction of bullet trains in India.
In a move to aid efforts to increase coal production, the union environment ministry has eased the clearance process to increase production for coal mines with 20 million tonnes per annum capacity. The ministry has decided to extend the exemption from holding public hearings for a one-time expansion of existing coal mines of 20 million tonnes capacity provided the transportation of additional coal is done by means of conveyor or rail transport. The ceiling on additional production has been kept at 6 million tonnes per annum.
On the global front, U.S. stocks finished Tuesday mixed to lower as sinking oil prices brought down energy-sector shares along with the price of oil and investors fretted whether the European Central Bank would make further monetary policy moves on Thursday. The Dow Jones Industrial Average fell 30.89 points, or 0.18%, to 17067.56 and the S&P 500 shed 1.09 points, or 0.05%, to 2002.28. Bucking the negative trend, the Nasdaq Composite Index rose 17.92 points, or 0.39%, to 4598.19. A gauge of the U.S. manufacturing sector climbed to 59 last month, the fastest pace of expansion since March 2011. The report added to concerns over whether the Federal Reserve may raise interest rates sooner than investors anticipate from the historic low range set during the height of the 2008 financial crisis.
Crude oil futures decline on Tuesday, as Monday's disappointing manufacturing data from China and the euro zone continued to weigh while tensions between Russia and Ukraine remained on focus. However later on, WTI oil little recover with rose to $93.26 a barrel after sinking 3.2% last session from the Aug. 29 close to the lowest settlement price since Jan. 14. Brent crude rose 0.2% to $100.55 a barrel after tumbling 2.4% yesterday amid concern slowing manufacturing from Europe to China will crimp demand for fuel.
Asian Indices are trading in green taking positive cues from the US markets. Shanghai Composite is trading with gains of 0.75% with Straits Times and KOSPI also trading with gains of 0.21% and 0.07% respectively. Tokyo's Nikkei edged up 0.78 per cent, lifted by continually weaker yen. And Hang Seng also in positive with gains of 0.69%. SGX Nifty is trading at in green with gains of 0.12%. Today we expect Indian equities open on a positive note on account of positive recent data and remain in positive zone in early hours of trade.