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The domestic markets on Tuesday, surprisingly, went for a rally in the second-half supported by across-the-board buying. The momentum is likely to continue today on supportive global cues and add some more weight. Reliance Industries acted as the major catalyst for the markets to move higher. Almost all the heavyweights performed well after remaining in a consolidation phase for the last couple of days. The good part was that the broader indices, too, were not lagging back and the trend is of good going for them today. The US markets closed modestly higher on Tuesday supported by some positive statements by the Federal Reserve; it kept the interest rates unchanged and pointed to the increased momentum in the economy???s recovery. European indices, too, rejoiced and stocks moved higher after Standard & Poor’s ended its review for a downgrade of Greece, saying the government???s recent deficit-reduction measures are supportive of the ratings. Concerns about Greece’s debt have been a drag on equities in recent weeks. The Asian markets have made a good start and most of the indices are trading higher by more than half a percent.

Back home, the domestic equity markets managed to break the shackles of a consolidation phase on Tuesday, prompted by strong cues from the European indices and sustained across-the-board buying from investors, barring fast moving consumer goods and public sector undertaking stocks. Second line stocks also hogged the limelight in trade. Regional peers ended mixed for the day. The first half of the day remained lacklustre for the local equities. They started the day with minor gains and oscillated in a narrow range tracking mixed Asian markets. The main indices slipped into the red to touch their day???s lows in mid-morning trades but managed to recoup their losses on persistent buying in the country???s largest listed company — Reliance Industries (RIL). If some media reports are to be believed, the company has been thrown out of the race for the controlling stake in Canada-based Value Creation and now it is looking to acquire three shale gas assets in the US. Higher advance tax numbers from most of the frontline companies also kept the sentiments on the positive side in the domestic markets. Meanwhile, the real drama was saved for the second half of the day as the positive start for the European shares triggered frenzied buying across the board. This rush from investors took the NSE???s 50-share Nifty beyond the psychologically important level of 5200. Finally, the key bourses closed the day with gains of over one percent each. Volumes spiked up from around Rs 65,000 crore to more than Rs 95,000 crore during the last hour of trade. Stocks from oil & gas, metal and capital goods space were the major growth drivers for the markets while PSU and FMCG stocks witnessed selective selling. Banking stocks managed to reverse their early losses. Finally, the BSE Sensex soared 218.19 points or 1.27% to end at 17,383.18 while the S&P CNX Nifty surged 69.20 points or 1.35% to shut shop at 5,198.10.

Equity markets in Asia were trading in the green following an assurance from the US Federal Reserve to keep interest rates low for an ???extended period.??? The markets were also supported by the announcement that a bailout framework has been worked out by European finance ministers for debt-ridden Greece. In the regional space, the Bank of Japan (BoJ) is likely to announce a hike in its credit program in a bid to stem deflation.

Shanghai Composite was up 18.19 points or 0.61% at 3,011.03, Hang Seng was up 174.65 points or 0.83% at 21,197.58, Jakarta Composite was up 42.90 points or 1.61% at 2,712.51 and KLSE Composite was up 4.14 points or 0.32% at 1,303.

Similarly, Nikkei 225 was up 74.07 points or 0.69% at 10,795.78, Straits Times was up 7.69 points or 0.27% at 2,904.12, Seoul Composite was up 14.63 points or 0.89% at 1,662.64 and Taiwan Weighted gained 94.72 points or 1.23% at 7,790.35.

The US markets closed modestly higher on Tuesday supported by the Federal Reserve???s upbeat take on the economy and its plans to hold interest rates low. The Fed in a statement following its meeting on monetary policy said that businesses are spending higher on equipment and software and also gave a marginally more upbeat assessment of the job market, though it said employers still remain reluctant to hire. On the flip side, the Fed???s statement hurt the dollar and lessened investors??? need to find safe places like the dollar to invest in and also helped the commodity and energy stocks move higher.

In economic news the Commerce Department said that construction of homes fell 5.9% last month to a seasonally adjusted annual rate of 575,000 units. The January activity was revised higher to a pace of 622,000 units, the best showing in 14 months. But applications for new permits fell 1.6%.

The Dow Jones Industrial Average was up by 43.83 points, or 0.41%, to 10,685.98. The Standard & Poor???s 500 index gained 8.95 points, or 0.78%, to 1,159.46, while the Nasdaq composite index closed higher by 15.80 points, or 0.67%, to 2,378.01.

Crude prices bounced back on Tuesday as the dollar weakened after the Fed kept interest rates unchanged at near zero level. Crude prices also got support with Standard & Poor’s ending its review for a downgrade of Greece. Now traders are awaiting results from OPEC???s meeting scheduled on Wednesday in Vienna, where oil ministers are expected to leave output targets unchanged while seeking better compliance.

Benchmark crude for April delivery was up $1.31, or 1.64%, at $81.11 a barrel after trading in a range of $79.32 to $81.34 on the New York Mercantile Exchange. In London, expiring April Brent crude rose $1.28, or 1.64%, to $79.17 a barrel.

article source: cafestocks