Markets gather steam

Mon, 5 Oct 01:30 pm

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After trading on a firm note during the morning session of the day, the Indian equity markets have surged further upwards in the post noon trading session. Gains are being led by stocks from capital goods, banking and auto segments.

The BSE-Sensex is trading up 450 points (1.8%) and the NSE-Nifty is trading up by 128 points (1.6%). The S&P BSE Midcap index is trading up by 1.6% and the S&P BSE Smallcap index is trading up by 1.5%. Gold prices, per 10 grams, are trading at Rs 26,421 levels. Silver price, per kilogram, is trading at Rs 36,016 levels. Crude oil is trading at Rs 3,000 per barrel. At the time of writing, the rupee stood at 65.28 to the US$.

Steel stocks are trading firm with Jindal Steel and Tata Steel witnessing maximum buying interest. According to a leading financial daily, Tata Steel is set to invest Rs 220 billion in the next fiscal to commission the first phase of its Kalinganagar plant project in Odisha. The project is being established in two phases of 3 million tonnes (MT) each and would roll out high-end flat products. The project is said to be the largest single location greenfield steel project in India. In its first phase, the steel plant will have two Coke Oven battery, each comprising 88 ovens and having a gross coke production capacity of 1.5 MTPA. Scrip of Tata Steel is trading up by 4% on the BSE.

Most of the stocks in the automobile sector are trading positively with Force Motors and Tata Motors leading the gains. As per an article in Economic Times, leading two and three-wheeler manufacturer in India Bajaj Auto has reported 3.76% decline in its total sales in September. The total sales came in at 3,84,400 units as against 3,99,450 units in the same month a year earlier. Further, motorcycle sales during the month declined by 4.83% to 3,30,228 units as against 3,47,010 units in September of last fiscal. However, the commercial vehicles sales of the company during the month witnessed an increase of 3.30%. Exports for the company came in at 1,73,801 units, marginally lower by 0.23% from a year earlier. The company's performance has also suffered in recent times due to its absence in scooters space. However, this may not be a long-term concern. As our automobile sector analyst Radhika Pandit points out, as long as the management of the company is able to demonstrate to shareholders that the decision to expand or acquire or enter new markets has been taken with profitability in mind, investors may have little to be worried about. Presently the stock of Bajaj Auto is trading up by 2% on the BSE.