Morning Note - Market Insight By Mansukh - 14th July, 2011

On Wednesday 13 July 2011, The Indian equity markets tailing their regional counterparts made a good bounce back on Wednesday, though, the trade remained in a narrow range but the indices held comfortable gains throughout the day. The Asian markets recovered with the report of good Chinese GDP growth in the second quarter that eased some worries of the markets that the global economic recovery won't falter. On the domestic front though there was not any specific trigger but the markets made a positive start on Chinese cues and moved higher supported by short covering and value picking at the lower levels. The rate sensitive's along with the oil & gas sector stocks propelled the markets higher after two consecutive sessions of drastic fall. Healthcare sector remained firm throughout the day supported by gains in the heavyweight Dr Reddy's, which announced that of receiving final approval of its ANDA for Fondaparinux Sodium Injection, a bioequivalent generic version of Arixtra(R), in the US market by the United States Food & Drug Administration (USFDA). The approval covers 2.5 mg/ 0.5 mL, 5.0 mg/ 0.4 mL, 7.5 mg/ 0.6 mL and 10 mg/ 0.8 mL doses of the drug in prefilled color-coded, single-dose syringes with automatic needle safety device. Some support also came from the market heavy weight Reliance Industries (RIL) after the Director General of Hydrocarbons (DGH), the regulator for oil explorers, defending its action has promised to initiate appropriate remedial action' against RIL if the company is found to have incurred unjustified cost, violating the provisions of the production sharing contract (PSC).  Good recovery was seen in the beaten down realty stocks like DLF, Anant Raj, Sobha Developers and Indiabulls Real Estate that surged in the range of 2-5%.

1) The BSE Sensex gained 211.89 points or 1.15% and settled at 18,623.51. The index touched a high and a low of 18,626.41 and 18,465.40 respectively. 24 stocks advanced against 6 declining ones on the index The BSE Mid-cap index gained 1.36% while Small-cap index was up 1.00%. On the BSE Sectoral front, Realty up 2.12%, Oil & Gas up 1.88%, Auto up 1.74%, Consumer Durables up 1.72% and Metal up 1.30% were the top gainers. On the flip side, there were no losers.

2) India VIX, a gauge for market's short term expectation of volatility lost 6.28% at 19.52 from its previous close of 20.83 on Tuesday. The S&P CNX Nifty gained 65.90 points or 1.19% to settle at 5,592.05. The index touched high and low of 5,596.15 and 5,541.40 respectively. 43 stocks advanced against 7 declining ones on the index. (Provisional)

3) All the Asian equity indices barring Taiwan Weighted finished their day's trade in the positive terrain on Wednesday on the back of better-than-expected Chinese economic growth data. China's second-quarter gross domestic product rose 9.5% from a year earlier, compared with 9.7% growth in the first quarter. However, investors remained worried over the euro-zone debt concern which continued to dampen sentiment, while the euro remained under pressure.