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Market Report

Thursday, 15-Jan-2015

NSE

  • Benchmark indices rose more than 2.5 percent each in trade today to post their biggest daily gain in eight months, after the Reserve Bank of India (RBI) surprised with a 25 basis point rate cut and hinted at more easing measures. The benchmark BSE index rose as much as 3.1 percent or 848 points in trade to surge past 28000; while the broader NSE index gained 3 percent or 250 points to reclaim its crucial psychological level of 8500.

  • The 30-share Sensex finally closed at 28075.55 today, up 728.73 points or +2.66 percent. It touched a high of 28194.61 and a low of 27703.70 in intraday trade today. The Nifty ended at 8494.15 today up 216.60 points or +2.62 per cent. It touched a high of 8527.10 and a low of 8380.55 in trade today, led by financials on expectations that further easing of interest rates would help spur growth.

  • The Reserve Bank of India's surprise move to cut repo rate by 25 bps has brought cheers to the Street. The euphoria led to the Bank Nifty hitting all-time high and it is only a matter of time, the benchmarks follow suit. The Bank Nifty hit all-time high of 19,410 and the momentum is likely to continue as the RBI is expected to announce more rate cuts in 2015. More than the rate cut, the Street is taking the RBI Governor Raghuram Rajan's statement on inflation and room for further easing positively. The central bank stated that once the monetary policy stance shifts, subsequent policy actions will be consistent with this stance. Key to further easing are data that confirm continuing disinflationary pressures.

  • Technically, the market has formed an island reversal, which is a strong bullish pattern, says Shrikant Chouhan of Kotak Securities. The intraday dips are being bought into. We are expecting the Nifty to face 8,550 in the near term. For the Nifty to hit all-time high there should be stability in global markets and continuous inflows. There are high chances of Nifty scaling 8,800 ahead of Budget Session, he added.

  • If Nifty holds 8400 mark, the trend should remain on the upside, says Ashwani Gujral. Normally we open gap up and then give up those gains, but we held on to the gap and started making fresh highs so that is the good news. The consolidation is now giving way to a trend on the upside. This rate sensitive business should last for another couple of days and then it should be back to global cues and the way US markets are moving. We have had six good years and the odds are against markets rallying for another year. If that is a case globally whatever we may do we will not be able to move up beyond a point. There may be a good opening tomorrow but if the global cues are weak overnight and if other markets are not supportive then we will have trouble going up, he adds.

  • After market hours: India's Trade deficit shrunk by 44 per cent from the previous month to $9.43 billion in December, government data showed today. Imports fell an annual 4.78 per cent last month year-on-year to $34.83 billion. Merchandise exports also declined 3.77 percent on year to $25.4 billion, the data showed.

NIFTY 3-Month

(Data/Charts courtesy NSEI/Yahoo!/iCharts/The Economic Times)