Hopes Drive Global Markets Higher
DSIJ Intelligence / 23 Aug 2012
The Sensex has been gradually inching towards the 18000 mark, and global markets have opened positive on the back of hope and optimism.
The Sensex has been inching towards 18000 in a slow and gradual process since opening. The Sensex is currently trading at 17952.67 having gained 105.81 points, higher by 0.59% while the Nifty is trading at 5444.3, higher by 31.45 points, up by 0.58%.
| Benchmark Indices | ||
|---|---|---|
| Index | Rate | % Change |
| FTSE | 5805.35 | 0.6 |
| DAX | 7073.11 | 0.8 |
| CAC | 3491.59 | 0.8 |
| Hang Seng | 20110 | 1.12 |
| Nikkei | 9178 | 0.51 |
| Shanghai | 2113 | 0.25 |
| SENSEX | 17952.67 | 0.59 |
| NIFTY | 5444.3 | 0.58 |
The Asian markets closed positive due to hopes on stimulus in the US and in China. With subdued data, investors have been hoping for stimulus that would accelerate growth in these economies. Data released by HSBC on the preliminary reading of the manufacturing Purchase Managers’ Index (PMI) has come in at a 9-month low thus giving more of a reason for China to engage in policy changes to boost the economy. After the market was presented with lethargic trade data and steel demand from China, sub-standard PMI commands the People’s Bank of China to take some action to increase momentum. European markets too opened positive on hopes over US and China, with the FTSE, DAX and CAC opening higher by 0.60%, 0.80% and 0.80% respectively.
Having talked about our previous trend of overall positivity in the markets, only 2 of the sectoral indices are now trading lower than their opening. Auto and Oil & Gas are lower currently by 0.11% and 0.14%. While Auto has been weighed down by M&M, Bajaj Motors and Tata Motors, Oil & Gas has been weighed down by Indian Oil Corporation, ONGC and BPCL. IT, Metals and Teck are still leading the charts with gains of 1.64%, 1.52% and 1.36% respectively.
Ranbaxy that has been gaining on the back of a withdrawal of 27 drugs from the US to reallocate resources efficiently is up by 3.05%. Among other gainers are Wipro, Tata Steel, IDFC and Cairn India, all gaining in the range of 2.13%-2.95%. Among the losers are Power Grid Corporation, Ambuja Cements and ONGC, losing between 1.05% and 1.22%.
We expect the markets to behave in the same manner as now throughout the day. The Sensex is expected to continue crawling towards the 18000 mark, but whether it will manage to reach it is questionable for today’s trading session.
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