Sensex closes at all time high levels

Fri, 6 Jun Closing

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Continued buying activity elevated the Indian stock markets higher during the final hour of trading, leading the Sensex to close at 25,396.46 points, beating the previous high of 25,375 points that was touched in the previous month. The BSE-Sensex closed the day with gains of about 380 points today (1.5%), while the NSE-Nifty closed higher by about 110 points or 1.5%. Stocks from the IT and metal sectors were the least favored today, while those from the realty and oil and gas spaces were the most preferred. The BSE Mid Cap and BSE Small Cap indices closed higher by about 1.6% and 1.5% respectively today.

Stock markets in other parts of Asia ended the day on a mixed note with Japan ending higher by about 2.2%, while Hong Kong and China ended lower by about 0.7% and 0.5% respectively. The rupee was trading at Rs 59.2 to the dollar at the time of writing.

Stocks of automobile companies ended the day on a firm note led by Hero Motocorp, Mahindra & Mahindra and Bajaj Auto. Commercial vehicle major Ashok Leyland reported an 8.7% YoY decline in sales volumes during the month of May 2014. The company sold a total of 6,632 units during the month. In the two month period ending May 2014, the company's sales volumes came in lower by 15% YoY. The decline in light commercial vehicles (LCVs) volumes was sharper than that of the medium to heavy commercial vehicles in both the periods. As per the company, sales of LVCs declined by about 32% YoY in the period April to May 2014 this year as compared to the 8% YoY decline in sales of medium and heavy commercial vehicles. Sales of the latter formed about three-fourth of the total sales volumes during the period. The stock of Ashok Leyland has been on fire the past few weeks gaining by as much as 50% in the month gone by and by 97% in the year till date. Today however, the stock closed the day lower by about 0.6% today.

Steel companies were in demand today with the top gainers from the sector being Steel Authority of India Limited (SAIL), Bhushan Steel and Tata Steel. As reported by a leading business daily, India's steel consumption increased by 0.5% YoY during the first two months of the current financial year. As reported by the Economic Times, the same stood at 12.6 m tonnes during this period. It is believed that due to the elections this year, the government spending was less - a major driver for steel consumption - and thus seems like the numbers are subdued. In FY14, steel consumption figures stood at 73.9 m tonnes, which was higher by 0.6% on a year on year basis. With nearly 60% of the steel consumed by the construction sector, an overall improvement in investment will be a major growth driver for the steel sector. The automobile segment contributes to nearly 15% of the demand. As the management of Tata Steel had indicated recently, India's steel consumption is expected to touch 75 m tonnes in FY15.