By Rutam Vora, Commodity Online
Indian markets made a positive opening with almost all commodity stocks trading in green. The sectoral indices on the Bombay Stock Exchange (BSE) showed increased buoyancy in the opening trades on Monday, June 14, 2010. The upbeat mood in the markets is seen on the back of positive global cues.
The Asian markets rose for a third consecutive day on Monday as higher confidence among US consumers boosted speculation that demand for products and resources will increase in the world’s biggest economy. The key benchmark indices in Japan, South Korea, Indonesia, Hong Kong, Taiwan and Singapore rose by between 0.48% and 1.56%.
Similarly, on the Western end, the US markets ended positively on Friday, 11 June 2010 after a report found consumers are gaining confidence in the economy. The Dow Jones Industrial average index rose by 0.4% to 10,211.07. The Standard & Poor’s 500 index rose 4.76, or 0.4%, to 1,091.60 and the Nasdaq composite index rose by 1.1%, to 2,243.60.
On the domestic front, better-than-expected industrial output during April 2010 boosted the investor sentiments as the markets have remained upbeat over past several trading sessions. The industrial output rose 10.4% in the 2009/10 fiscal year (April-March), faster than the 2.6% clocked in the previous fiscal year. As the monsoon has set-in at most of the regions in the country, the expectations will run high for the FMCG stocks, which are heavily dependent on the agri-output scenario post monsoon.
As per the India Meteorological Department (IMD)’s statement on 10 June 2010, rainfall in the seven days to 9 June 2010 recovered to normal after an initial hiccup when cyclone Phet hindered the advance of the June-September monsoon, which irrigates 60% of farms in India.
In stock specific actions, Reliance Industries Ltd (BOM:500325), a heavy-weight oil & gas stock has gained momentum primarily on the news of the company’s diversification plans to telecom sector after the company’s announcement of acquisition of majority stake in Infotel Broadband Services Ltd at a cost of around Rs.4800 crore. The company had made the announcement after trading hours on 11 June 2010.
FMGC leader, Hindustan Unilever Ltd (BOM:500696) has announced a buy-back plan of shares at a price not exceeding Rs.280 per share. The company had made the announcement after market hours on 11 June 2010. The company has set aside Rs.630 crore for buyback. The stocks opened with a positive gap on the morning trades and gained close to 1.5% at Rs.256 on BSE.
Meanwhile, Sensex traded at 17218.11 points up by 0.90% from its Friday’s close. The index has been positive for three consecutive trades.
Metals stocks also remained positive with sectoral index, BSE Metals trading at 14613 points up by 1.26% in the morning trading session on Monday. Jindal Group pipe making arm, Jindal Saw Ltd (BOM:500378) lead the metal stocks with stock trading at Rs.197.20, up by over 3% in the morning trades today.
Other metals gainers includes steel stocks like Tata Steel Ltd (BOM:500470), Bhushan Steel Ltd (BOM:500055) and SAIL (BOM:500113), while Hindalco Industries Ltd (BOM:500440) and Sterlite Industries (India) Ltd (BOM:500900) also posted gains at the opening moves on BSE today.
The upbeat move is expected to continue on the Indian bourses throughout the day as most of the commodities stocks are in green and positive indications coming from western economies. However, the opening of European markets will bear significant impact on the Indian markets in the later trading hours
