Sensex rallies 348 points to end at 1-week high; IIP, CPI eyed

Stock traders

Benchmark indices ended near day’s high amid renewed buying interest in the second half of the trading session with Tata group shares and IT majors leading the gains.

Investors are keenly awaiting the announcement of the macroeconomic data – Feb IIP and March CPI due on Tuesday and the fourth quarter earnings kick starting on Friday with IT giant Infosys.

Further, India Inc set to post best EBIDTA growth in six quarters. Earnings growth likely to accelerate to 12-15% in fiscal 2017, says CRISIL Research.

The S&P BSE Sensex rose 348 points to end at 25022 and the Nifty50 gained 116 points to close at 7671.

Among broader markets, BSE Midcap and Smallcap indices surged between 0.6%-1%.

“There will be strong support at 50% retracement levels of the entire rise which comes to 7,300 Nifty50.

“Markets have entered into a short term corrective mode which will take some time to correct the entire post budget rally from 6,850 to 7,750.

“Traders should wait for entering into fresh long positions. Aggressive traders can go short keeping stops at previous week high.

“The undercurrent in the short term has turned weak, there is loss of momentum, indicating correction has set in,” said Jimit Modi, CEO, Samco Securities.

Besides, the World Bank trimmed its 2016 and 2017 economic growth forecasts for developing East Asia and Pacific, and said the outlook was clouded by risks such as uncertainty over China’s growth prospects, financial market volatility and further falls in commodity prices.

In the currency front, rupee strengthened by 10 paise to 66.37 against the dollar at Interbank Foreign Exchange on increased selling of the US currency by exporters and banks amid higher opening in the domestic equity market.

Sensex graphMeanwhile, market will remain closed on Thursday and Friday on account of Baba Saheb Ambedkar Jayanti and Ram Navami, respectively.

Among overseas markets, Asian stocks erased early losses and edged up on Monday as Chinese inflation data fanned optimism Beijing will continue with loose monetary policies, while Japanese shares slid as the dollar notched a fresh 17-month low against the yen.

MSCI’s broadest index of Asia-Pacific shares outside Japan added about 0.2%, after Wall Street ended with modest gains on Friday even as the S&P 500 still suffered its biggest weekly decline in two months.

Japan’s Nikkei stock index was off its session lows but still ended down 0.4%. In addition to a stronger currency, data released early on Monday showed Japan’s core machinery orders fell 9.2% in February from the previous month, in a sign that business investment remains subdued.

Back home, Bharti Airtel gained over 4% at Rs 349 after the company said it has entered into an agreement with Aircel to acquire its 2,300-MHz spectrum band in eight circles for Rs 3,500 crore.

The acquisition will enable Bharti Airtel to become a pan-India 4G operator.

Tata Steel rose around 3% after it reported 13% growth in sales to 2.72 million tonnes in the quarter ended March 2016 compared to the same quarter last fiscal.

Crude steel production for the March 2016 quarter was 5% higher at 2.56 million tonnes.

Tata Motors Group global wholesales in March 2016, including Jaguar Land Rover, were at 118,750 numbers higher by 11%, over March 2015. Tata Motors jumps around 4%.