Nifty will head higher as long it closes above 7,600
We had mentioned in Tuesday’s closing report that Nifty, Sensex are likely to put in a small rally and that Nifty may head higher if it stays above 7,500. The major indices of the Indian stock markets put in a small rally, apart from touching a 52-week low, and the gains at close of trading were 0.69%-0.87%. The trends of the major indices during the course of Wednesday’s trading are given in the table below:
Positive European indices, coupled with short-covering and attractive prices, buoyed the Indian equity markets on Wednesday. This led to the S& P BSE Sensex to close the day's trade with a gain of 149 points. However, the indices soon ceded all their gains. Anxiety was stoked by the third quarter (Q3) results season that started on Tuesday. Long-liquidation positions and sliding Chinese markets, too, dented investors' sentiments on Wednesday.
The Supreme Court on Wednesday asked Mysuru-based CFTRI lab to get more samples of Maggi to test the lead and Mono Sodium Glucomate (MSG) contents in its taste makers. The apex court bench of Justice Dipak Misra and Justice N.V. Ramana also asked the Central Food Technological Research Institute (CFTRI) to tell if the lead content found in its tests of Maggi carried out in October, in pursuance to the order of NCDRC, was within the limit prescribed under the food safety law and rules framed under it. Giving the lab two months-time to carry out the tests and submit its report, the court said if the lab needed more samples, it should ask for them. The next hearing of the matter is on April 5. Nestle India shares closed at Rs5,501.95, up 1.06% on the BSE.
In a fillip to Prime Minister Narendra Modi's ambitious ‘Make in India’ initiative, over 100 top Chinese handset and component manufacturers gathered here on Wednesday in what could bring $2-$3 billion investment in Indian mobile manufacturing operations in the next two years. Top officials from major Chinese companies such as Techno, Gionee, Coolpad, Holitech, Wingtech, Camera King, Galaxy Core, Poxiao, Vivo and Sprocomm participated in the first-ever summit titled “China-India Mobile Phone & Component Manufacturing Summit,” in the Capital to explore avenues to tap the existing and emerging opportunities. Leading Indian mobile companies such as Micromax, Lava, Karbonn, Spice, Vodafone and Intex also participated in the day-long event. “Going by the encouraging response of Chinese companies and definitive joint collaboration talks between the Indian and Chinese mobile and handset manufacturers, Chinese investment of $2-3 billion over the next two years looks like a real possibility along with employment for one-two lakh people”, said Pankaj Mohindroo, national president, Indian Cellular Association (ICA). The representatives of the Chinese companies also plan to visit offices and factories of Indian mobile brands like Micromax and Lava to understand their operations.
Chinese stocks closed lower on Wednesday, with the benchmark Shanghai Composite Index down 2.42%, at 2,949.6 points. The smaller Shenzhen index lost 3.06% to close at 9,978.82 points, Xinhua news agency reported. The ChiNext Index, which tracks China's NASDAQ-style board of growth enterprises, tumbled 4.09% to close at 2,059.78 points.
Tokyo shares ended the morning session sharply higher after a six-day decline as the sentiment was boosted by gains in the overnight US stocks market and a weaker yen. The 225-issue Nikkei Stock Average skyrocketed 463.37 points, or 2.7%, from Tuesday to 17,682.33, Xinhua news agency reported. The broader Topix index of all First Section issues on the Tokyo Stock Exchange was up 39.44 points, or 2.8%, to 1,441.39.
The US dollar gained on Tuesday as market expected the Federal Reserve to continue the interest rate hike in 2016. Given the considerable improvement in labour market, traders believed that the US central bank will continue the rate hike, while central banks in Japan and Europe were expected to unleash further stimulus. On the economic front, the number of job openings was little changed at 5.4 million on the last business day of November, the US Labour Department reported on Tuesday. The US dollar index, which measures the greenback against six other major currencies, was up 0.24% at 98.981 in late trading. In late New York trading, the euro fell to $1.0856 from $1.0875 of the previous session, and the British pound decreased to $1.4430 from $1.4548.
The top gainers and top losers of the major indices are given in the table below:
The closing values of the major Asian indices are given in the table below: