Markets Gain As Obama Wins

Indian shares today gave a green salutation to the re-election of Barack Obama as President of the United States of America for the next four years. The BSE Sensex gained 85 points to touch 18902 and Nifty gained 35 points or 0.6% to end the day at 5760 points.

A similar trend was seen in the global markets, as most of them were trading in the green or had closed higher at the time of writing the report. In Asia, the Nikkei and Shanghai markets closed flat, while Hang Seng was up 0.7% at closing. The indices in South Korea, Taiwan also showed significant gains today.

The European markets are also witnessing gains. While the CAC is heading towards making over 1% intraday gains, both DAX and FTSE are also up by over 0.5%.

Dow Jones and NASDAQ futures are also showing some gains at the moment, and therefore, one can expect a positive opening in the US markets.

Among the sectors, the Realty index closed as top gainer with 2.76% gains. Bankex also gained more than 1% on hopes of a rate cut by the next quarter. While most indices closed the day in green, Oil & Gas ended in the red. The midcap and smallcap indices were also up over 0.7%.

Of the Sensex stocks, the shares of HDFC gained 1.9%. State-owned lender SBI also gained 1.9%. ICICI Bank and HDFC Bank also gained as the sentiment on the banking and financial sectors was boosted. Electricity equipment maker BHEL also saw a jump of 1.7% in its share price to Rs 236.40 per share. Dr. Reddy’s Labs had gone up about 1% during the day, but saw some profit booking and closed with 0.46% gains. All the three IT stocks in the index – Wipro, Infosys and TCS – saw a jump in their share price after Obama’s win. Maruti Suzuki, which was down yesterday on the news of an employee strike, also saw a recovery of 0.92% by closing.

Tata Power closed down 2.44% after the company posted a loss of Rs 83 crore against an expected net profit of Rs 275 crore for the Sept quarter. The shares of Bharti Airtel also closed in the red after its net profit for the quarter came in to Rs 721.2 crore against expectations of Rs 831 crore.

Tata Motors jumped 0.9% ahead of its results announcement today. Overall, the street was expecting to see the firm’s consolidated net profit up by 17% at Rs 2200 crore. The company has reported a net profit of Rs 2075 crore after market hours today, which means that we may see some sell-off in its shares tomorrow.

Among other stocks, pharma major Cadila Healthcare was down 3% on the bourses after it reported a 7% decline in its net profit. This was mainly on account of higher raw material costs. The shares of Gujarat Alkalies and Chemicals saw a gain of 3% after the company reported a 78% jump in its net profit yesterday. Amid a very bullish sentiment, Wockhardt saw a 4.24% rise in its share price to touch Rs 1624 per share.

The shares of Reliance Capital jumped over 3% after the company posted a net profit of Rs 401 crore for the Sept quarter.

The advance-decline ratio on the BSE indicated a positive bias, as a total of 55% shares advanced against 40% declines.

After Obama’s re-election, the hopes of another round of QE have increased. Overall, we expect the markets to remain in the positive terrain for the week.