The Sensex closed at 17,198 as it gained 272 points from the previous day’s close, while the Nifty closed at 5,122, up 89 points, after data showed strong Indian economic expansion in the September quarter.
During the day, Sun Pharmaceutical jumped 6%. The company had recently received United States Food and Drug Administration’s approval for its generic Strattera capsules, used for treatment of attention deficit hyperactivity disorder. The drug is a therapeutic equivalent of Strattera capsules from Eli Lily.
Maruti Suzuki India rose 2% after total vehicle sales spurted 66.6% to 87,807 units in November 2009 over November 2008. Domestic sales surged 60.1% to 76,359 units, while exports surged 128.6% to 11,448 units in November 2009 over November 2008.
Tata Motors is reportedly planning to produce hybrid versions of its low-cost car Nano to join the environment-friendly bandwagon. The stock surged 6%.
Mahindra & Mahindra (M&M) signed an agreement with BAE Systems, a global defence systems manufacturer, to create a land systems focused joint venture defence company that will be based in India. M&M will hold 74% in the venture and BAE Systems will hold the remaining 26%, the maximum foreign direct investment allowed under the existing defence sector FDI norms. The two companies will invest a total of $21.25 million over a three-year period. The stock was up 5%.
Reliance Industries (RIL) advanced 3% on reports that the company has become the largest natural gas producer in the country with its over 50 million metric standard cubic meter per day (mmscmd) output, surpassing state-run Oil and Natural Gas Corporation’s output.
State Bank of India gained 2% on reports that the bank has invited bids for sale of 1% stake in the National Stock Exchange of India (NSE) as well as 5.91% stake in the Multi Commodity Exchange (MCX).
Mercator Lines rose 4% after the company took delivery of a 1993 built M R tanker of 42,235 dead weight tonnage.
Jubilant Organosys rose 3% after the company extended its four-year old drug discovery collaboration agreement with Eli Lilly and Co by five years.
Peninsula Land shot up 5% after the company received a sum of Rs160 crore from Alok Realtors from the sale of 6.41 lakh square feet at Peninsula Business Park in Mumbai.
After the trading hours on Monday, the government announced that India’s fiscal deficit during the April to October 2009 period was at Rs2.45 lakh crore ($52.70 billion), or 61% of the full-year target. Tax receipts were Rs2.14 lakh crore and total expenditure was Rs5.37 lakh crore for the first seven months of the 2009-2010 fiscal.
During the day, the government announced that exports fell 6.6% to $13.19 billion in October 2009 over October 2008, while imports dropped 15% from a year earlier to $22 billion. The trade deficit shrunk to $8.80 billion in October 2009 from $11.74 billion a year earlier. Exports for April-October 2009, the first seven months of the 2009-10 fiscal year, were down 26% at $91.05 billion from the same period in the previous year.
According to C Rangarajan, chairman of the prime minister’s Economic Advisory Council, the robust growth of the economy in July-September indicated it could expand at around 7% in 2009-10. The latest numbers do indicate that industry and services are growing very strongly offsetting the impact of the decline in agricultural production, Mr Rangarajan said.
Meanwhile, finance minister Pranab Mukherjee told Parliament that the current trend in inflation in India was a result of a shortage of food items and not due to a demand-push factor. The food articles index rose an annual 15.6% as of 14 November 2009, up from the previous week’s 14.6% rise. Weak monsoon and floods in parts of the country have hurt farm output and pushed up food prices. He said that the government is keeping a close watch on futures trading in commodities.
The finance minister said buoyancy in the government’s revenue seen earlier may not continue till 2011-2012. Mr Mukherjee also said that the government will not sell over 10% in listed State-run firms at this stage and will time its stake sale to get maximum value.
The HSBC Markit Purchasing Managers’ Index, based on a survey of 500 companies, fell to 53 in November 2009 from 54.5 in October 2009. According to the survey, India’s manufacturing activity expanded for the eighth straight month in November 2009 but was at its weakest pace since March 2009 due to a slowdown in growth of output, new business and employment.
During the day, Asia’s key benchmark indices in Hong Kong, Singapore, South Korea and Taiwan were up by between 0.88%-0.98%, while indices in China and Japan were up 1% and 2% respectively.
The purchasing managers’ index released by HSBC Holdings Plc rose to a seasonally adjusted 55.7 in November 2009 from 55.4 in October 2009 whereas the Chinese government’s purchasing managers’ index was unchanged at a seasonally adjusted 55.2.
The Bank of Japan decided to take additional easing steps at a special policy meeting in order to sustain the country’s fragile economic recovery in light of deflationary pressures and a soaring currency.
The Japanese central bank kept its overnight call rate target unchanged at 0.1%, but also set up a new 10 trillion yen ($120 billion) lending facility, which will accept as collateral Japanese government bonds, corporate bonds, commercial paper, and deeds on loans. The bank pledged to cooperate with the government to do all it can to pull Japan out of deflation, which the bank has said it expects to last for three fiscal years.
Meanwhile, the Reserve Bank of Australia raised its cash rate target by one quarter of a percentage point to 3.75%, further unwinding emergency policy settings no longer appropriate for the country's recovering economy.
On Monday, 30 November 2009, the Dow Jones Industrial Average gained 35 points while the S&P 500 and Nasdaq Composite gained four points and six points respectively.
As per US economic data, the Institute for Supply Management (Chicago) reported that its gauge of regional business activity rose to 56.1 in November 2009 from 54.2 in October 2009.
However in premarket trading, the Dow was trading 66 points higher.