Post Session-Sensex extends rally, ends up 95 points on global cues Analysis for Jan 20, 2012

Today, the domestic benchmarks closed on a robust note for a second straight session amid positive global cues. The Banking and Consumer Durables space led the rally.

BSE SENSEX closed at 16739.01 up by 95.27 points or by 0.57 % and then NSE Nifty ended at 5048.6 up by 30.2 points or by 0.6 %.The BSE MIDCAP closed at 5680.07 up by 10.08 points or by 0.18 %, while the BSE SMLCAP ended at 6277.27 up by 5.04 points or by 0.08 %.The BSE Sensex touched intraday high of 16788.48 and intraday low of 16611.71 The NSE Nifty touched intraday high of 5064.15 and intraday low of 5004.3.

The positive closing of the US markets on Thursday boosted domestic sentiment during morning trade. On Thursday, the Dow Jones Industrial gained 45.03 points and closed at 12623.98. The S&P 500 gained 6.46 points and closed at 1314.5 and the Nasdaq closed at 2788.33, gaining 18.62 points over the previous day's closing. Soon after witnessing a gap up opening, the key domestic benchmarks surged higher amid supportive cues from the Asian markets. Asian markets traded higher on Friday amid hopes that the US economic recovery was gaining steam. US jobless claims fell to the lowest level since April 2008 last week, signaling a significant pickup in the nation's job market. Moreover, the successful French and Spanish bond auctions on Thursday also eased concerns over the Eurozone debt turmoil. French borrowing costs fell at a debt auction on Thursday, while Spain raised 6.61 billion euro, more than its target of 4.5 billion euro, easing concerns over the debt contagion. Better than expected Q4 results of investment banking giant Morgan Stanley also boosted sentiment. On the domestic front, higher than expected earnings of IT major Wipro also lifted investor confidence. The benchmarks continued to trade on a firm note during afternoon trade. However, the benchmarks pared off gains and slipped below the baseline amid weak trade in European markets. European markets were down on Friday after the IMF warned that severe fiscal cuts may hamper the growth outlook of Europe. The benchmarks recovered quickly and regained momentum to surge to the day's high in the final hour of the session. Finally, the benchmarks ended on a robust note, with the BSE Sensex and the NSE Nifty gaining over 0.50% each. Among the BSE Sectoral indices, BSE Bankex and BSE Consumer Durables ended up 3.51% and 2.31% respectively.

Among the 30 Sensex stocks, Bajaj Auto, ICICI Bank, Jindal Steel & Power, BHEL and Hero MotoCorp ended up 6.18%, 5.81%, 3.35%, 3.09% and 2.63% respectively. Among the Sensex stocks, there were 19 advances and 11 declines. On BSE out of total shares traded 3006, shares advanced were 1380 while 1523 shares declined and 103 were unchanged.

On the Economic front, trade between India and the ASEAN nations is expected to increase to USD 70 billion in 2012, the government said on Friday. Trade between India and the ASEAN countries reached USD 50 billion last year.

On the global front, manufacturing activity in Asia's largest economy, China, contracted for a third straight month in January 2012 as new orders and output shrank amid policy tightening and worsening global outlook, said a report by Markit Economics on Friday. The preliminary China Manufacturing Purchasing Managers' Index (PMI) stood at 48.8 in January 2012, below the mark of 50 that separates expansion from contraction.

On the Asian front, Shanghai Composite ended up 1%, Hang Seng closed up 0.84% and Nikkei 225 ended up 1.47% on Friday.

On the European front, CAC40 was down 0.59%, DAX was trading lower by 0.54% and FTSE100 was down 0.06% on Friday.

On the Corporate front, Wipro reported a 10.43 per cent increase in Q3 net profit to Rs 1,456.4 crore, compared to the year ago period. The stock ended up 2.38% at Rs 413.70 on the BSE.

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