Markets Soar Higher As SP Supports Congress

In an action-packed trading session, the markets have gradually been moving upwards. As the government takes bold steps towards the implementation of retail FDI regardless of opposition, the markets are seeing a wave of positive sentiment. Media reports on a possible discussion of sugar subsidies and FDI in insurance also supported this uptrend. Furthermore, the Mulayam Singh Yadav-led Samajwadi Party hinted that it would continue supporting the UPA. All these factors gave a further boost to the markets.

Currently, the Sensex is trading higher by 406.61 points or 2.22% at 18755.86 and Nifty is trading higher by 2.36% at 5685.10.

The global markets too are trading higher today. After yesterday’s sentiments being subdued due to data from China and Japan leading to increased concerns over China’s outlook, trades have been positive today. Technology stocks have been significantly higher because of the release of Apple's iPhone 5. Technology companies in Taiwan, Apple’s suppliers and telecom companies have seen considerable gains. The falling dollar has had an upward effect on commodity prices and has also spurred an upward trend in oil, which lost approximately 5% this week. With this, Asian stocks are higher in the range of 0.11%-0.81%.

European stocks also opened positively following a report in Financial Times that the EU authorities are working with Spain on a rescue plan. FTSE100, DAX30 and CAC40 trading higher by 0.5%. 0.3% and 0.5% respectively.

On the domestic front, the Sensex, midcap and smallcap are up by 2.22%, 1.44% and 1.29% respectively. 12 of the 13 sectoral indices are trading positive. Power, Banking and Capital Goods are amongst the top gainers having gained 4.09%, 3.83% and 3.11% respectively. IT, though, has been yielding negative returns today on the back of a strong rupee.

Among individual stocks, Reliance Infra and GMR Infra have gone up by 9.58% and 8.87% respectively. Banking stocks have outperformed, with Axis Bank, Canara Bank, ICICI Bank and SBI gaining in the range of 4.47%-6.17%. TCS and Infosys are lower by 0.65% and 0.54% respectively due to the rupee appreciation.

We expect the upward trend to continue over the rest of the day on the back of the overall positivity in the markets.