Sensex soars 285 as Mar trade deficit cheers; banks rally

Equity benchmarks surged Thursday led by strengths in shares from the banking, capital goods and auto sectors, with the Sensex closing above the psychological 19000-mark.

Brokers said the narrowing of March trade deficit to a two-year low of USD 10.3 billion helped sustain the positive sentiment created by a decline in gold and crude oil prices.

The Sensex closed at 19016.46, up 285.30 points over its previous close, and the Nifty gained 94.40 points to close at 5783.10.

HDFC, Bharti Airtel, Tata Motors, L&T, Axis Bank, and Oriental Bank of Commerce were the key gainers among frontline shares, rising between 3-5 percent.

IndusInd Bank shares gained 7 percent on better than expected. Shares of JSW Steel and Sesa Goa rose briefly after the Supreme Court lifted a one-and-a-half-year ban on mining in Karnataka. But the stocks gave up much of the gains, with JSW Steel closing in the red and Sesa Goa ending the day marginally higher.

Falling commodity prices are a big positive for India and this could even prompt many foreign investors to increase their weightage for the country in their portfolio, said Tirthankar Patnaik of Religare Capital in an interview to CNBC-TV18 earlier today.

However, Andrew Holland of Ambit struck a cautious note saying that news flow from Europe could worsen and could trigger a global sell-off. He sees the Nifty falling to 5200 by May.

The market began to firm up after the March trade deficit numbers were released, which showed a decent improvement in exports.

Borkerage house Nomura attributed the better-than-expected March trade deficit number partly to seasonal factors, but said falling imports would help improve outlook on India's stretched current account deficit.

"The improvement is partly seasonal as exports tend to rise at the end of the financial year it also reflects a combination of higher exports and weak imports. While part of the seasonal improvement in the March trade deficit will reverse in April, the recent fall in oil and gold prices can lead to a saving of 1% of GDP on the current account deficit on an annualised basis, if the current price fall sustains," the Normura note said.

Bank shares continued to rise, despite concerns that Indian banks' asset quality may not be what it appears to.

An IMF report two days back cautioned that debatable asset restructuring practices and vague definitions of distressed assets was leading to asset quality problems being underestimated in countries like India and China.

"India's banks remain well capitalized, but credit quality has tended to deteriorate recently, particularly among the state-owned banks, which account for 73 per cent of banking assets," said the IMF's Fiscal Monitor Report.

The Sensex is trading firm in last one hour of the final trading day of this week. The exchanges will be shut tomorrow on account of Ram Navami. The current rally is more fundamentally driven then a mere technical bounce back or short covering.

The earnings season so far has been mixed. Infosys disappointed last week but HCL Tech and TCS improved the sentiments for the IT sector. Banks have posted decent results.

The Sensex is up 226 points at 18955 and the Nifty is up 75 points at 5763. The breadth of the market is also encouraging. About 1253 shares have advanced, 991 shares declined, and 1316 shares are unchanged.

Bharti Airtel, IndusInd Bank, Tata Motors, IDFC and Axis Bank are top gainers on the Nifty. NMDC, HCL Tech, Power Grid, Grasim and TCS are top losers.

The rupee is trading at 54.02 versus its previous close of 54.21/22 but off the day's high of 53.96 as some dollar short-covering is seen with importers like oil firms stepping in to buy the greenback.

The government said exports had hit USD 300.6 billion for the fiscal year ended March, higher than some estimates and marking a 1.76 percent decline from the previous fiscal year, the trade ministry said in a statement.

The Supreme Court (SC) on Thursday lifted a one-and-a-half-year old iron ore mining ban in Karnataka, lifting the shares of mining companies between 2-15 percent.

IT stocks are trading weak after rupee appreciated to 54 levels. HCL Technologies is down 1 percent.

It was a stable session for the market as the Nifty held above 5700 firmly led by strength in banking, capital goods and auto. The Nifty was up 53.85 points at 5742.55 while the Sensex gained 169.28 points to be at 18900.44.

Bharti Airtel, Tata Motors, HDFC, L&T and SBI were the lead gainers in the Sensex.  There were modest gains for broader markets too. Manappuram (up 4.9 percent), Reliance Comm (up 3.1 percent), Dabur (up 1.7 perecnt) and Prestige Estates (up 3.5 percent) were gainers from that space.

JSW Steel and Sesa Goa were excited as the Supreme Court allowed mining in category B mines in Karnataka. However, it has cancelled all category C mining leases. JSW Steel told CNBC-TV18 that it will take 1-3 months to restart operations after the reopening of category B mines.

Jet Airways soared around 3.5 percent. According to government sources, the Jet-Etihad deal may be finalised in a month.

Meanwhile, Wipro, TCS, Hero MotoCorp, Jindal Steel and Sun Pharma dragged.

The equity benchmark indices are trading strong in the afternoon trade. A sharp fall in global crude prices bodes well for India's current account deficit problems. India will also benefit from the appreciation in rupee which is also hovering around 54.

China's GDP grew lower than estimates in the last quarter and the concerns of slowdown in demand from the world's fastest growing economy led to fall in crude prices. Crude inventories also went up by 1.22 million barrels last week.

"The trade deficit has increased to USD 190.91 billion compared to USD 183.4 billion last year," said Commerce Minister, Kamal Nath.

The Sensex is up 109 points at 18840 and the Nifty is up 32 points at 5721.

The breadth of the market is also positive. About 1072 shares have advanced, 863 shares declined, and 1625 shares remain unchanged.

Bharti Airtel, Axis Bank, Ranbaxy Labs, HDFC and Larsen are top gainers on the Nifty. NMDC, Hero Motocorp, Power Grid and Jindal Steel are top losers.

It was a steady session for the market in trade today. The Nifty was hovering around 5700 mark after Indian crude basket slumped to USD 97.66 per barrel. India being the net importer of crude and gold will benefit the most from recent fall in commodities.

The Sensex is up 84 points at 18814 and the Nifty is up 22 points at 5711.

Bharti Airtel, Ranbaxy Labs, HDFC, Larsen and BPCL are top gainers on the Nifty. NMDC, Hero Motocorp, Jindal Steel, Power Grid Corp and Cairn India are top losers.

Indian oil marketing companies such as Hindustan Petroleum Corp Ltd gain on hopes recent slump in crude prices would lower the cost of under-recoveries.

Hindustan Petroleum gains 2.3 percent, Bharat Petroleum Corp Ltd is up 2 percent and Indian Oil Corp Ltd gains 1.9 percent.

ITC hits life time high extending gains for a sixth straight session on reports of price hikes in some categories of cigarettes.

Infosys gains 0.5 percent on value buying after the stock's recent fall on company's muted revenue guidance for 2013/14.

It was a lacklustre opening on the back of negative global cues. Wall Street fell sharply overnight, hit by disappointing Apple's results and its tepid outlook. Asia too has started on subdued note this morning.

The Sensex was up 56.93 points at 18788.09 and the Nifty gained 16.75 points or 0.29% at 5705.45.

Banking, metals and auto stocks were under some selling pressure. According to technical analyst, Sudarshan Sukhani, s2analytics.com volatility is likely to continue taking the Nifty to lower levels.

Stock-specifically, TCS received lukewarm response in trade even though its fourth quarter earnings had beaten street estimates. The stock was down 0.7 percent.

The other big losers in the Sensex were Tata Motors, ICICI Bank, Bajaj Auto and Maruti Suzuki.

Meanwhile, HMT continued to extend the rally as it soared 8.6 percent as the CCEA is likely to consider HMT's revival plan. The proposal is to infuse Rs 1083 crore  into HMT.

RIL, HDFC, NTPC, Bharti Airtel and Bajaj Auto were the lead gainers in the Sensex.