Indian Markets Friday Wrap-Up: Metals, Realty Lead the Pack

After witnessing a volatile trading session today, the Indian markets ended the day on a strong note as buying activity increased during the final hour. The BSE-Sensex ended higher by around 260 points, while the NSE-Nifty, closed higher by about 65 points. Stocks from the mid-cap and small-cap spaces ended the day on a positive note as well, recording gains of around 1.7% and 0.8% respectively. Stocks from the capital goods, metals and realty spaces managed to garner the investors’ interest.

Other Asian markets ended the day on a positive note today as well. The European indices are currently trading in the green. Rupee was trading at 48.10 against the US dollar at the time of writing.

Steel stocks ended the day on a firm note led by JSW Steel, Tata Steel and Jindal Steel. As per a leading business daily, Tata Steel has raised prices of its products by up to Rs 750 per tonne. The management of the company has attributed the same to improved domestic demand for the commodity and a firming global trend. It may be noted that the company has hiked the prices in its monthly contracts in select regions. The domestic steel sector has been witnessing an improvement in demand from certain sectors like construction and automobiles in recent times. This is a positive development for the company as it will help it to improve its realisations.

Engineering stocks ended the day on a firm note led by Suzlon, Punj Lloyd and L&T. The stock of Reliance Infrastructure ended the day on a firm note on the news that the company hopes to acquire the Mumbai Metro (2nd phase) contract. As per a leading business daily, the company has already started negotiating with domestic banks to tie up funds worth Rs 110 bn for the project. The management is confident of bagging the contract as it was the sole bidder in the project. However, it may be noted that R-Infra quoted a viability gap of almost Rs 23 bn, which was much less than the permissible limit of 40% (or Rs 31 bn) of the total cost of the project.

The World Bank has approved a US$ 180 m (Rs 9 bn) loan for making improvements in select thermal power plants in India. As per a leading business daily, these funds will be used for renovating and modernising old, polluting and inefficient coal-fired power plants in the country. This would in turn help in lowering carbon emissions and improving generation significantly. As per the bank spokesperson, this development is believed to be the first step in a decade long plan to overhaul and improve power supply in India. It may be noted that the average plant load factor (PLF) of thermal power plants in India stands at about 75%, which is much lower when compared to developed countries.