Benchmarks continue its rally for second day in a row

The Indian equity markets have made a gap-up start tracking positive cues from the global indices as most of the Asian counterparts were trading in the positive terrain at this point of time, indicating strong investor's sentiments, while overnight rally in the US markets supported by surge in technology pack on good earnings report too boosted the sentiments. Back home, sustained buying in key heavyweights along with broader indices kept the markets on the positive side. On the sectoral front, metal witnessed the maximum gain in trade followed by realty and oil and gas with no losers on the BSE sectoral space. The broader indices too were trading in the positive terrain. Key heavyweights viz., Reliance Industries and Tata Consultancy Services were trading with a gain of over one percent ahead of their quarterly earnings announcement. However, PSU oil marketing companies like Bharat Petroleum Corporation, Hindustan Petroleum Corporation and Indian Oil Corporation were trading with a cut of more than half a percent as crude prices move higher by over 2 percent on report of drop in stockpiles. The market breadth on the BSE was positive; there were 1,117 shares on the gaining side against 633 shares on the losing side while 69 shares remained unchanged.

The BSE Sensex opened at 19,582.50; about 112 points higher compared to its previous closing of 19,470.98, and has touched a high and a low of 19,635.49 and 19,561.51, respectively.

The index is currently trading at 19,591.04, up by 120.06 points or 0.62%. There were 24 stocks advancing against 6 declines on the index.

The overall market breadth has made a strong start with 61.41% stocks advancing against 34.80% declines. The broader indices too were trading in the green; the BSE Mid cap and Small cap indices gained 0.33% and 0.37% respectively. 

The top gaining sectoral indices on the BSE were, Metal up by 0.76%, Realty up by 0.62%, Oil and Gas up by 0.58%, CG up by 0.56% and IT was up by 0.55%. While there were no losers on the index.

The top gainers on the Sensex were Hero Honda up by 2.61%, TCS up by 1.37%, Hindalco up by 1.17%, Wipro up by 1.11% and ONGC was up by 1.05%.

On the flip side, M&M down by 0.77%, Tata Motors down by 0.75%, Bharti Airtel down by 0.43%, Jaiprakash Associates down by 0.30% and Bajaj Auto down by 0.29% were the top losers on the index.

Meanwhile, rubber production in the country increased by over 7% in the month of March, ending the positive fiscal on a strong note even as the prices of the commodity continue to hover around the record highs seen in recent months. Rubber has remained in a bullish zone for several months as global demand-supply equation remains tight.

According to the data compiled by the Rubber Board of India, total natural rubber production in March 2010 stood at 54,400 tonne. On a financial year basis, total production in the April-March 2011 period stood at 2,77,095 tonne as against 2,11,290 tonne in the previous fiscal, thus recording a growth of over 3%. The increase came mainly in the second half of the financial year as farmers increased tapping in response to strong prices.

Domestic consumption on the other hand has increased by little over 2% compared with last financial year to 9,49,205 tonne. This has come as a surprise during the last year, production of the automotive tyres increased by 23% while exports increased by 20%. Since tyre industry consumers nearly half the rubber produced in the country, total consumption growth should have been higher. However, it is possible that other rubber consuming industries cut down on consumption given the high prices.

According to the rubber Board, stock situation is also comfortable and there was no need to worry by the tyre industry. Board's data suggests that opening stock of rubber in 2011-12 stood at 2,77,095 tonne compared with a corresponding figure of 2,11,290 tonnes at the start of last financial year. In this wake, even though prices may remain high, supply should not be a major issue, the Rubber Board said.

Analysts expect that while some correction in near term was possible from highly elevated levels, overall, the prices of natural rubber may continue to remain strong through most of the 2011. This is because global supplies are unlikely to show substantial increase as aging problem of rubber trees has intensified in many producing countries. Only when new trees come under tapping by next year, a structural change in supply curve is possible. Till then, increase in supply will only come from intensified tapping of existing trees, which may be sufficient to dent prices much.

The S&P CNX Nifty opened at 5,882.85; about 31 points higher compared to its previous closing of 5,851.65, and has touched a high and a low of 5,894.05 and 5,870.25 respectively.

The index is currently trading at 5,878.75, higher by 27.10 points or 0.46%. There were 32 stocks advancing against 18 declines on the index.

The top gainers of the Nifty were Hero Honda up by 2.55%, TCS up by 1.37%, Wipro up by 1.33%, Hindalco up by 1.14% and HDFC Bank up by 1.06%.

Siemens down by 1.37%, BPCL down by 1.21%, Kotak Bank down by 0.83%, Dr Reddy down by 0.83% and IDFC down by 0.79, were the top losers on the index.

Asian markets were trading mostly in the green; Shanghai Composite was up 20.60 points or 0.69% to 3,027.64, Hang Seng was up 203.03 points or 0.85% to 24,099.13, Nikkei 225 was up 56.72 points or 0.59% to 9,663.54, Straits Times was up 30.06 points or 0.95% to 3,195.86, Seoul Composite was up 24.68 points or 1.14% to 2,194.59 and Taiwan Weighted was up 158.22 points or 1.80% to 8,971.50.

On the flip side, Jakarta Composite was down 0.17 points and KLSE Composite was down by 0.98 points or 0.06% to 1,530.04. 

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