BSE Sensex gains 400 pts; banks, metals, cap goods on fire

3:30 pm Buzzers: Shares of Ranbaxy Laboratories continued to rally for the second consecutive session, rising 4.5 percent in intraday trade. Macquarie has an outperform rating on the stock with a target price of Rs 550, saying it remains one of the top picks in the Indian pharma space. Bajaj Auto shares rallied nearly 5 percent in intraday trade as it reported a growth in its September sales for the first time in last eight months.

The domestic motorcycle sales posted largely flattish growth as against expectation of 10 percent decline while export boost continued in September. During the epriod, Total sales of the Pune-based two-wheeler maker rose by 2 percent year-on-year to 3.67 lakh units as against 3.60 lakh units.

The market continued rally in the last hour of trading. The Sensex is up 401.22 points or 2.06 percent at 19918.37, and the Nifty up 134.55 points or 2.33 percent at 5914.60. About 1398 shares have advanced, 875 shares declined, and 140 shares are unchanged. Banking, metals, capital goods, technology and auto stocks are leadign the indices while FMCG stocks are the only laggards in the Sensex. Sesa Goa  (up 7.5 percent), Bajaj Auto (up 5 percent), Hindalco (up 5 percent), TCS (up 4 percent) and Tata Steel (up 4 percent) are top gainers in the Sensex.

FMCG majors ITC and HUL are dragging during the day.  Meanwhile, Crude oil slipped to around USD 109 a barrel on Thursday on worries that a prolonged US government shutdown would hurt demand in the world's biggest oil consumer. President Barack Obama met with Republican and Democratic leaders in Congress to try to break a budget deadlock that has shut wide swaths of the federal government, but after more than an hour of talks no breakthrough emerged, reported Reuters.

02:55pm Crude Update Crude oil slipped to around USD 109 a barrel on Thursday on worries that a prolonged US government shutdown would hurt demand in the world's biggest oil consumer. President Barack Obama met with Republican and Democratic leaders in Congress to try to break a budget deadlock that has shut wide swaths of the federal government, but after more than an hour of talks no breakthrough emerged, reported Reuters.

02:40pm Largecaps on fire BSE Metal Index rallied 4 percent and Bankex jumped 3 percent followed by Capital Goods, IT, Oil & Gas, Auto and Realty indices climbed 2-2.5 percent. Sesa Goa extended its rally to 8 percent now followed by TCS , Bajaj Auto , Tata Steel , Hindalco and Tata Power with 4 percent gains. Index heavyweights Reliance Industries , HDFC, HDFC Bank , L&T and Tata Motors gained 2-3.5 percent. Among others, Sun Pharma , ONGC , M&M, Maruti, Wipro and Coal India rose 2-3 percent.

02:31pm It is a strong session for the market with the equity benchmarks surging 2 percent in afternoon trade. Technology, metals, financials and auto stocks rally whereas HUL and ITC remained under pressure, falling more than 1 percent. The Sensex is up 356.24 points or 1.83 percent to 19,873.39 and the Nifty is up 123.95 points or 2.14 percent to 5,904.

Advancing shares outnumbered declining ones by 1398 to 857 on the Bombay Stock Exchange. TCS surged 4 percent as Goldman Sachs upgraded the stock to a buy with a target price of Rs 2300 per share. The brokerage house forecasts that the sector will lead US dollar revenue compunded annual growth rate of 18 percent over FY13-FY15E.

Ranbaxy Labs gained 3.7 percent. Macquarie says Absorica's market share has reached 17.5 percent as per IMS data and hence the brokerage house raised its sales estimate for the drug. Macquarie feels the current weakness is an excellent opportunity to add the stock. It has an outperform rating on the stock with a target price of Rs 550.

The cabinet committee on economic affairs is likely to take up the Jet-Etihad deal later today. The deal which has already got clearance from SEBI, CCI and Cabinet, now awaits the CCEA nod to go through. Jet shares rallied 5 percent. Tata Communications gained 4.7 percent. HSBC upgraded the stock to an overweight after factoring in Neotel's spectrum value. The brokerage house also raised a target price to Rs 233 from Rs 180. Meanwhile, the rupee rose 67 paise or 1 percent to 61.78 against the US dollar.

2:00 pm Take on auto stocks: Although most auto companies have seen better sales number for the month of September, Kapil Singh, auto analyst, Nomura says it does not really show significant revival. Months of October and November could show the real picture. He thinks the uptick in numbers could have been because of inventory stocking and pre-buying by dealers since some companies had announced a price increase from October 1. Nomura prefers Tata Motors with a price target of Rs 391. In the two-wheelers' space, given the upsurge in imports, Bajaj Auto looks better positioned than Hero MotoCorp, says Singh. The house remains positive on Mahindra and Mahindra too. Amongst the auto ancillaries it has a buy on Amara Raja Batteries, Exide Industries and Bharat Forge.

1:45 pm Exclusive: There is a need to resolve Immigration Bill issues with the US at the earliest, believes Som Mittal, President, NASSCOM. Concerns surrounding the proposed Immigration Bill and its adverse impact on visas for highly skilled non-immigrant workers have been an overhang for the Indian information technology (IT) companies for quite some time now. In July, the US Senate had passed an Immigration Bill that changed rules governing H-1B and L-1 employment visas intended for high-skilled workers. The Bill is yet to be approved by the House of Representatives. Speaking exclusively to CNBC-TV18's Shereen Bhan, he said that he expects negative provisions to be removed from the bill and US companies like IBM also supporting the House Bill.

1:30 pm Buzzer: Mahindra and Mahindra (M&M) shares rallied more than 3 percent in intraday trade Thursday on top of a 0.7 percent upmove in previous session, driven by strong growth in tractor business. Total tractor sales of the company grew by 33 percent to 26,637 units in September from 20,085 units in a year ago period, but its auto sales declined 10.5 percent year-on-year to 43,289 units from 48,342 units.

A mid week break seems to have added some spirit to the bulls. The Sensex is up 273.91 points or 1.40 percent at 19791.06, and the Nifty up 97.85 points or 1.69 percent at 5877.90. About 1320 shares have advanced, 756 shares declined, and 124 shares are unchanged. Sesa Goa, Tata Steel, TCS, Wipro and Hindalco are top gainers in the Sensex. On the losing side are HUL, ITV, Bharti Airtel and NTPC. Telecom stocks are in focus as the DoT rejects TRAI's views on slashing spectrum prices. Analysts say all this policy flip-flop is proving to be negative on the sector and stocks like Bharti Airtel are down about a percent.

Meanwhile, HSBC upgraded Tata Communications to "overweight" from "neutral" and raised its target price on the stock to Rs 233 from Rs 180, citing a potential takeover of unit Neotel. South Africa's Vodacom Group said on Monday it was in exclusive talks to buy the Tata Communications' unlisted local unit, Neotel, in a potential USD 590 million deal, reported Reuters. The stock gained 4 percent.

12:55pm Brokerage house upgrades Tata Communication HSBC upgraded Tata Communications to "overweight" from "neutral" and raised its target price on the stock to Rs 233 from Rs 180, citing a potential takeover of unit Neotel. South Africa's Vodacom Group said on Monday it was in exclusive talks to buy the Tata Communications' unlisted local unit, Neotel, in a potential USD 590 million deal, reported Reuters. The stock gained 4 percent.

12:45pm Market Expert Richard Titherington, CIO and head-EM Equity, JPMorgan AMC is more concerned about the tapering of quantitative easing than the US debt ceiling which will occur in mid-October as it will have a longer-term impact on the market which had a dramatic affect on the emerging markets earlier in the year. In an interview to CNBC-TV18 Titherington says the timeframe and the quantum of the tapering will play key roles in deciding the faith of the market once the Fed finally starts tapering.

Meanwhile, he believes the investment sentiment towards India is still fragile as the country still remains in a higher risk camp among other emerging markets due to its huge current account deficit. The Sensex is up 317.37 points or 1.63 percent at 19834.52, and the Nifty is up 109.95 points or 1.90 percent at 5890. On the global front, European markets are flat while Asian markets are mixed.

12:35pm Gainers & Losers Metals stocks are the major gainers in trade today with the BSE Metal Index rising 3.5 percent followed by Bank, IT, Realty, Auto, Oil & Gas and Capital Goods indices rallying 2-2.7 percent. Sesa Goa topped the buying list in the Sensex, gaining 6 percent. Tata Steel , TCS , Wipro and Jindal Steel gained 3-4 percent. However, ITC, HUL and Bharti are the only losers in the Sensex, falling between 1-2 percent.

12:25pm Rupee Update The rupee has strengthened today, appreciating 63 paise to 61.83 against the US dollar. Rohit Arora, Barclays believes the rupee will stabilise at its current levels after the Indian currency gained 61.90 against the dollar in the morning trade. According to him, the Reserve Bank of India's support to the oil marketing companies has eased the pressure on the rupee. However, he believes the recent rally in the rupee is due to broad dollar weakness rather than the INR strengthening.

Speaking to CNBC-TV18 Arora says that going ahead dollar is likely to strengthen as the US manufacturing data is pretty strong. Also, he adds that the QE tapering is inevitable though it has been delayed, but once Federal Reserve starts with the tapering in December, it could lead to some dollar strengthening.

12:18pm The market is on fire in noon trade Thursday with the Sensex rallying 300 points and the Nifty inching towards 5900 level, driven by upmove in all sectors barring FMCG. The Sensex is up 296.64 points or 1.52 percent at 19813.79, and the Nifty is up 103.00 points or 1.78 percent at 5883.05. More than two shares advanced for every share declining on the Bombay Stock Exchange. TCS is the leader among largecaps, rising 4.5 percent after Goldman Sachs upgraded the stock to buy from neutral and raised the target price to Rs 2300 from Rs 1700 earlier. The brokerage house forecasts sector leading USD revenue CAGR of 18 percent for TCS over FY13-FY15E, on the back of its strong positioning in a rising demand backdrop.

12:00 pm Buzzer: Shares of Ranbaxy rises 3 percent on the back of some brokerage news. Macquarie says Absorica's market share has reached 17.5 percent as per IMS data and hence it has raised their sales estimate for the drug. The brokerage firm adds that the current weakness is an excellent opportunity to add. Macquarie has an outperform rating with a target of Rs 550.

11:45 am Market outlook: Sanjay Dutt of Quantum Securities sees the global uncertainty extending to Indian market as well, but adds that downsides are limited. In an interview to CNBC-TV18 , Dutt said that the Nifty is unlikely to break 5,700. Like most market experts, he is also of the view that the debt ceiling issue is more important than the US shutdown. Dutt likes the beaten down banking space as a contrarian bet and prefers to buy midcap PSU banks at current prices. He is not too bullish on FMCG giant HUL and is not looking to buy it at current price. Infact he feels one should not buy HUL even if went down another 5-7percent. Dutt is cautious on IT stocks.

11:30 am Stock in news: Shares of Jet Airways gained around 8.5 percent in morning trade on Thursday, in addition to a rally of about over 6 percent in the last three trading sessions. The Cabinet Committee on Economic Affairs (CCEA) is likely to take up the Jet-Etihad deal later today. Earlier, market regulator Securities and Exchange Board of India (Sebi) approved the Jet Airways' proposed sale of 24 percent stake to Abu Dhabi-based Etihad Airways. Sebi has also added that after the revised structure, the Jet-Etihad deal should not trigger a mandatory open offer for purchase of shares from public shareholders and Etihad would not be considered a promoter entity in Jet.

Active buying is seen to be pulling the market higher with the Sensex rising 270.48 points or 1.39 percent at 19787.63 while the Nifty is at 5872.62 up 91.30 points. About 1173 shares have advanced, 487 shares declined, and 92 shares are unchanged. Nifty futures premium widened post freak trade that took place at 5996 level. There was a volume of about 8 lakh shares at the same level. TCS , Sesa Goa , Tata Steel , Wipro and Bajaj Auto are top gainers in the Sensex. Laggards of the day include HUL, ITC and Bharti Airtel

Meanwhile, Asian markets are trading in the green. Investors are watching for progress on ending of the budget impasse in the US. Back home, the rupee opens higher on account of the dollar weakness. The Korean won, Malyasian ringgit, Thai baht and Phillipine peso are all up against the greenback. Meanwhile, bonds are softer today. Sentiment improves ahead of the RBI's bond purchase auction on Monday.

10:59am Crude Update Brent futures slipped below USD 109 a barrel on Thursday, after posting their biggest gain in two weeks in the previous session, on worries a prolonged US government shutdown would hurt demand in the world's biggest oil consumer. President Barack Obama met with Republican and Democratic leaders in Congress to try to break a budget deadlock that has shut wide swaths of the federal government, but after more than an hour of talks there was no breakthrough. Oil was also under pressure from a surprise surge in US crude stockpiles, reported Reuters.

10:55am Infosys signs multi-year contract Infosys has signed a contract with Toyota Motor Europe for the provision of its pan-European application support for four years. The stock rose 0.6 percent.

10:55am Infosys signs multi-year contract Infosys has signed a contract with Toyota Motor Europe for the provision of its pan-European application support for four years. The stock rose 0.6 percent.

10:55am Infosys signs multi-year contract Infosys has signed a contract with Toyota Motor Europe for the provision of its pan-European application support for four years. The stock rose 0.6 percent.

10:45am Lupin 's launch in US Lupin's US subsidiary Lupin Pharmaceuticals has launched its generic Gatifloxacin Ophthalmic Solution, 0.5 percent in the US.  It had received final approval from the United States Food and Drugs Administration to market a generic version of Allergan Inc's Zymaxid Ophthalmic Solution, 0.5 percent (for the treatment of bacterial conjunctivitis). The stock gained 1.3 percent.

10:35am Nifty Freak Trade The current rally in the Nifty to 5870 is partly attributed to freak trade in Nifty futures. Nifty futures premium widened post freak trade that took place at 5996 level. There was a volume of about 8 lakh shares at the same level. The Nifty jumped 87 points or 1.51 percent to 5,867.05 and the Sensex rallied 262.67 points or 1.35 percent to 19,779.82.

10:25am Movers & Shakers Tata Steel , Jindal Steel , HDFC Bank , M&M, GAIL and Coal India rallied more than 2.5 percent followed by Tata Motors , L&T, Hero MotoCorp, Sun Pharma , BHEL , Cipla , Reliance Industries and L&T with more than 2 percent gains. However, HUL remained under pressure, falling 1 percent on top of a 3 percent drop in previous session after its parent company warned that a slowdown in its emerging markets including India, accelerated in the third quarter.

10:19am The market extended gains in morning trade with the both equity benchmarks gaining 1 percent, aided by technology, capital goods, HDFC twins, auto and metals stocks. The Sensex is up 191.52 points at 19,708.67 and the Nifty is up 60.90 points at 5,840.95. Sandeep Shenoy of Anand Rathi Financial Services says that the Indian equity market movement is more related to the currency performance and policy moves than the policy logjam in Washington.

The rupee rise above 62-mark, gaining 58 paise to 61.88 against the US dollar. TCS and Sesa Goa are the biggest gainers, rising 3.6 percent each followed by Wipro and Bajaj Auto with 3 percent gains. Investors are buying shares of Bajaj Auto as its better-than-expected sales have finally seen a growth Y-o-Y after seven consecutive months of Y-o-Y drop. Total sales increased 2 percent to 3.67 lakh units in September as against 3.60 lakh units in a year ago period.

10:00 am Market check:  The Sensex continues to see good buying interest. The Sensex is up 176.12 points  at 19693.27. About 795 shares have advanced, 340 shares declined, and 47 shares are unchanged. TCS , Wipro , Sesa Goa with gains of 3 percent each are leading the pack in the Sensex, followed by Coal India and Tata Steel . On the losing side are HUL , Bharti Airtel , ITC and SBI .

9:45 am FII views Laurence Balanco of CLSA: Incredible volatility in the Nifty persists with price action having recently tested and failed below chart resistance at 6,120-6,209. Tuesday's move below initial support at 5,820 triggered a minor head-and-shoulder topping pattern which suggests further weakness in the coming sessions and supports an initial downside target of 5,513. Sakthi Siva of Credit Suisse: In price to book value terms, MSCI Asia-ex Japan is 22 percent lower than 2011 while the discount to global equities is now 20 percent versus 3 percent in 2011. Given these differences, we suggest buying the dips in Asia-ex Japan markets, particularly in cyclicals. Investors may want to look at rate sensitives as well if Fed tapering is delayed.

9:30 am Buzzer: A panel of the Department of Telecommunication (DoT) has rejected TRAI's views on slashing spectrum prices and has asked for a full review of the reserve price. The panel has further said that TRAI's valuations do not reflect value of liberalised spectrum. Shares of Bharti Airtel, Idea Cellular , Reliance Communication are trading weak.

The market seems to be cheerful after a day's holiday for Gandhi Jayanti. The Sensex shoots up 139.73 points at 19656.88. About 269 shares have advanced, 70 shares declined, and 12 shares are unchanged. In early trade the Indian rupee opened with a gain of 30 paise at 62.15 per dollar versus 62.45 Tuesday. Ashutosh Raina, HDFC Bank said, "The partial shutdown in US has led to dollar losing against all other major as well as emerging market currencies. Back home, the trade deficit numbers for June quarter have been more or less on expected lines, which has lent some strength to the rupee. Expect the currency to trade in the range of 62-63/USD today."

The euro soared to an eight-month high as ECB president Mario Draghi said the ECB is prepared to do more should the economy warrant it. The dollar index fell as low as 79.78 at one point, its lowest since February. US markets ease off session lows but still closed lower, amidst mounting worries that the current impasse would lead to a failure to raise the country's debt ceiling. European markets closed lower as the US Government shutdown continued and jobs data came in weak. However, Italian shares rallied after Prime Minister Enrico Letta won a vote of confidence in the senate by a resounding margin.

European markets closed lower as the US Government shutdown continued and jobs data came in weak. However, Italian shares rallied after Prime Minister Enrico Letta won a vote of confidence in the senate by a resounding margin. European Central Bank president Mario Draghi has once again decided to hold the key lending rates. In a press conference, Draghi said the recovery across the eurozone remains uneven and fragile. Asian markets are mixed after a meeting between President Barack Obama and Congressional leaders failed to yield a solution to Washington's budget stalemate. Amid losers, Japan's Nikkei hovered near the previous session's three-week low and Australia's S&P ASX 200 and Indonesian stocks rose 0.6 percent each.

In commodities, Nymex posted its largest gain in two weeks on news of the imminent start of the trans-Canada pipeline. The news narrowed the premium between Brent and Nymex to its narrowest level in a week From precious metals space- gold prices jumped nearly 3 percet recouping most of the previous session's tumble, as a drop in the dollar and weak US Equities sparked bargain hunting in the precious metal.