Markets Bounce Back To Show Strength

As expected, the Indian markets opened on a very strong positive note today. The indices have surged by 1.4% each at this time, and have gained the most in Asia. With this, the markets have snapped all the negatives seen in the week. The rupee has appreciated by 0.6% to 52.68 against the dollar on this positive sentiment.

All the Asian indices are in the green except for those of Japan and Taiwan. Shanghai is up by 1% and Hang Seng is up 0.3%. The South Korean KOSPI is up 0.2% and SGX Nifty is up 73 points or 1.3% at 5755, sending positive signals to investors.

Earlier yesterday, the Spanish government approved a budget focussing on the cuts in spending despite public agitation on the austerity measures. The government, however, has not increased the taxes. On the back of this, the US and European markets closed in the green yesterday, giving a positive signal to the Indian equities. The US second quarter GDP estimate, though, was revised to 1.3%, down from previous estimates of 1.7%.

On the indices front, Auto, Realty and Metals are leading the rally, all up by 2%. The Power index is up 1.9% and the index major Tata Power has surged by 3.5%. Besides this, Torrent Power, Lanco Infra, Rinfra, RPower, PGCIL have all gained over 1%. HC and Bankex are the only indices to show underperformance, trading with over 0.7% gains.

The sentiment is so positive right now that there are no losers among the Sensex stocks. Tata Power is witnessing over 3.5% gains again, and is among the top index gainers. Tata Motors, Tata Steel and TCS too are showing over 2% gains, as are Hindalco, Coal India, Jindal Steel and Sterlite. Very few stocks are showing flat trades.

Among other stocks, Sun TV Network is up 5% and Zee Entertainment is trading with 4.6% gains. LIC Housing Finance has surged, as we expected, while Kingfisher Airlines has slipped in today’s trades. Tulip Telecom is showing strong volumes and its shares have also appreciated by 5%. Mahindra Satyam has shown gains of 1.83%.

Atul Auto, Bajaj Finance, Titan, Shree Cement and Gruh Finance have notched new highs, while JTL Infra and Prabhav Industries are at new lows.

The volumes are strong and the advance-decline ratio is positive. Hence, we  expect the markets to remain positive ahead today.