Tuesday, July 9, 2013

Markets gain on Rupee measures by regulators


Markets ended higher on Tuesday, amid firm global cues, after the Reserve Bank of India stepped to prevent further fall in the rupee. The recovery in the rupee also boosted market sentiment.

The 30-share Sensex closed up 115 points at 19,439 and the Nifty  gained 47 points to close at 5,859 for the day.

The broader markets had a strong session in which both the mid and smallcap indices advanced 0.7%, outperforming the BSE benchmark index which closed with a 0.6% gain.

The rupee rallied on Tuesday from a record low in the previous session after regulators restricted speculative trading in currency derivatives, although the measures are expected to provide only brief respite for the currency. The rupee was trading at 60.40 to the US dollar compared to its previous close of Rs 60.61.

Late on Monday the Reserve Bank of India banned banks from proprietary trading in domestic currency futures and options, while Securities and Exchange Board of India (Sebi) doubled the margin requirement on the domestic dollar-rupee forward trade.

The steps are the latest by regulators to curb speculative trading, which would pare short positions in the rupee, after some bankers said they had been discreetly asked last month by the RBI to trim intraday open positions.

Global stocks witnessed a firm trend on the back of strong US jobs data last week and encouraging second quarter earnings from Alcoa, the largest aluminium producer in the US.

European shares firmed up today after Greece secured the latest 6.8 billion euro installment of its bailout boosted market sentiment. The CAC-40, DAX and FTSE-100 were up 0.7-1%.

Stocks in Asia also ended higher with Japan's benchmark Nikkei ended up 2.6%, near a six-week high, after the yen weakened against the US dollar. The Shanghai Composite gained 0.4%, Hang Seng rose 0.5% and Straits Times ended 0.7% higher.

Back home, all the sectoral indices were in the green for the day. The top gainers were Consumer Durables, Power, Realty, Capital Goods, Health Care and Bankex indices gaining 1.2-2%. Oil & Gas index up 0.04% was the least gainer.

The movers among the sensex-30 were Sun Pharma which closed up 3.6% after the company had recommended issue of bonus shares to existing shareholders in the ratio of 1:1, yet to announce record date for the same.

BHEL, Bajaj Auto, Sterlite, Dr Reddys Lab, L&T, NTPC, HDFC Bank, Wipro, SBI, Cipla and Infosys which added 1-2.2% were the other notable gainers.

HDFC, ICICI Bank, Reliance Industries, Hindalco and Tata Power up 0.5-0.7% too closed in the green.

Among the ones in the red were Jindal Steel, Mahindra & Mahindra, ONGC, Hindustan Unilever, Maruti Suzuki and Bharti Airtel closing lower by 0.5-1.9%.

The market breadth was positive on the BSE. 1,306 stocks advanced while 1,014 stocks declined.

Smart Moves

Strides Arcolab dipped 6% to Rs 789, on reports that the Department of Industrial Policy and Promotion has put on hold the company’s unit sell plan on concerned that ownership of critical cancer drug-making facilities will fall into foreign hand

Karnataka Bank moved higher by 6% to Rs 115 after the private sector bank said it has signed Memorandum of Understanding with Reliance Capital for financing the micro, small and medium enterprises through co-financing arrangement.

Steel Strips Wheels soared 9.5% to Rs 149 after the company said it has bagged European Patent for innovative design concept in semi-full face wheels.

Aptech rallied 7% to Rs 62.55 after the company said it has received the shareholders approval for share buyback proposal through postal ballot.

Havells India rallied nearly 5% to Rs 782, after a broking firms upgraded the stock with Buy rating.

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