Post Session -Sensex ends up 81 points, regains 17K mark Analysis for Jan 25, 2012

Today, the key domestic benchmarks closed on a strong note as the Sensex surpassed the 17K mark amid firm cues from the Asian markets. The Metal and PSU space led the rally.

BSE SENSEX closed at 17077.18 up by 81.41 points or by 0.48 % and then NSE Nifty ended at 5158.3 up by 30.95 points or by 0.6 %.The BSE MIDCAP closed at 5834.04 up by 72.13 points or by 1.25 %, while the BSE SMLCAP ended at 6408.45 up by 70.44 points or by 1.11 %.The BSE Sensex touched intraday high of 17130.24 and intraday low of 17016.69 The NSE Nifty touched intraday high of 5174.15 and intraday low of 5130.25.

The weak closing of the US markets on Tuesday made little impact on domestic sentiment during morning trade. On Tuesday, the Dow Jones Industrial Average ended down by 0.26% or 33.07 points at 12,675.75, the S&P 500 ended down 0.10% or 1.35 points at 1,314.65 and the Nasdaq closed up by 0.09% or 2.47 points at 2,786.64. Soon after witnessing a gap up opening, the benchmarks continued to trade in the positive terrain amid firm Asian market cues. Asian markets were trading in the positive terrain on Wednesday as a weaker yen boosted the outlook for Asian exporters. Moreover, record quarterly earnings reported by Apple Inc., the world's largest technology company also lifted sentiment. Apple Inc. said that its first quarter profit more than doubled to USD 13.06 billion from USD 6 billion in the year ago period on robust iPhone and iPad sales. Moreover, the euphoria over the CRR cut by the RBI on Tuesday also supported sentiment. However, the benchmarks pared off some of their gains as Greece and its private creditors struggled to reach a deal on bond swap. Moreover, a third straight decline in Japanese exports in December 2011 also weakened sentiment. Moreover, the IMF slashed its global growth forecast to 3.3 per cent in 2012 from 4 per cent estimated earlier, which also weighed on sentiment. On the domestic front, the expiry of the F&O contracts also lead to volatility in trade. The benchmarks extended their gains during afternoon trade as the Sensex regained the 17K level. The benchmarks continued to trade on a firm note before surging to the day's high. The benchmarks pared off some their gains in the final hour of trading amid weak opening in the European markets. Finally, the benchmarks ended on a robust note, with the Sensex and the Nifty gaining over 0.40% each. Among the BSE Sectoral indices, BSE Metal and BSE PSU ended up 1.79% and 1.24% respectively.

Among the 30 Sensex stocks, Coal India, Tata Motors, Tata Steel, Sterlite Industries and Maruti Suzuki closed up 3.9%, 3.78%, 2.97%, 2.47% and 2.44% respectively. Among the Sensex stocks, there were 18 advances and 12 declines. On BSE out of total shares traded 3026 , shares advanced were 1837 while 1067 shares declined and 122 were unchanged.

On the Economic front, the RBI has said that it prefers non-debt inflows into the Indian economy over debt inflows, adding that any increase in the investment limit for foreigners in Indian debt will not be automatic.

On the Global front, UK edged closer to another recession after the economy contracted in the fourth quarter, 2011 as the deepening debt contagion in Europe and financial market strains squeezed demand, said a report by the Office for National Statistics on Wednesday. Gross domestic product (GDP) contracted by 0.2 per cent in the October -December 2011 quarter, compared to the previous quarter.

On the Asian front, Nikkei 225 ended up 1.12% and Seoul Composite closed up 0.12% on Wednesday.

On the European front, CAC40 was down 0.28%, DAX was down by 0.50% and FTSE 100 was trading lower by 0.66% on Wednesday.

On the Corporate front, Suzlon Energy announced on Wednesday that its arm Repower Systems has been awarded a contract for the delivery of 25 wind turbines to a US based company. The stock of Suzlon Energy ended up 2.83 % at Rs 27.25 on the BSE.

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