Extending the strong rally in afternoon trade, the Indian benchmark indices closed the day on a strong note. Post the bullish US manufacturing and construction data, software stocks witnessed a robust momentum driving the benchmark indices. Except power and FMCG, all the other sectoral indices closed on a firm note with stocks from the technology and realty spaces closing the day on a thumping note. Both the BSE Mid Cap and the BSE Small Cap indices gathered steam and were up by 0.9% and 0.4% respectively. The BSE Sensex closed higher by 121 points. The NSE-Nifty surpassed the 8100 mark and was seen up by 32 points.
On the global front, the Asian indices closed the day on a firm note. The European indices too have opened on a buoyant note. The rupee was trading at Rs 60.49 to the dollar at the time of writing.
Energy stocks closed the day on a mixed note. While Castrol India and IOC have topped the list of gainers, Petronet LNG and GAIL led the pack of laggards. A leading financial daily states that the shares of oil marketing companies have been upbeat with Brent crude price plunging down to a 16-month low close to US$ 100 per barrel. This has been primarily on the back of strength in dollar index. The strong dollar has put pressures on oil prices especially after the robust uptick in currency. The stocks of HPCL, BPCL and IOC and other oil marketing companies have been trading close to multi-year highs with a hope of further decline under recoveries as Brent price tumble. The government has mentioned that under recovery on high speed diesel (HSD) applicable for first fortnight of September will reduce to Rs 0.08 per litre. The same was Rs 1.78 per litre during second fortnight of August 2014.
As per a leading financial daily, rating agency Moody's is believed to have mentioned that the chances of an upward revision in the country's sovereign ratings stands limited. That's because the agency believes that despite the positive economic growth in the first quarter, the high fiscal deficit and the sticky inflation continue to dampen the upward momentum in the sovereign rating. While the 1Q GDP stands at 5.7%, the CAD stands at 1.7% of GDP. Moreover, the government has committed 4.1% of fiscal deficit target for the current fiscal, but has already exhausted over 61% of the fiscal's target in the first four months itself. The rating agency has further stated that he macroeconomic outlook will improve if the government is able to "implement policies that ease inflationary pressures and increase infrastructure investment", as put forth by the financial daily.