Overseas Market View

European shares rose to their highest level in more than four months on Tuesday, as firmer oil stocks and a surge in telecoms group Nokia offset a slump in UK bank Standard Chartered after becoming embroiled in a scandal.

As a result, The FTS Euro first 300 index closed up 0.8 percent at 1,094.19 points, while the Euro STOXX 50 index rose 1.7 percent to 2,440.24 points. Spain’s benchmark IBEX stock market index rose 1.4 percent, while France’s CAC and Germany’s DAX closed up 0.8 per cent and 0.5 per cent respectively.

On the flip side, U.S. stocks surged for a third straight day on Tuesday, pushing the S&P above 1,400 for the first time since early May, on growing optimism the European Central Bank would act soon to contain the euro zone’s debt crisis. Hopes for fresh policy actions to help debt-market strugglers Spain and Italy buoyed the market sentiment. Since then, good news from Greece and declines in borrowing costs for Spain and Italy from peaks above 7 percent have kept sentiment positive.

However, summer holidays have added to light trading volume, which has contributed to volatility. Tuesday’s advance was led by stocks in cyclical sectors like energy, materials and consumer discretionary, while defensive sectors like telecoms and utilities edged lower.

Cheering the news, the Dow Jones Industrial Average gained 51.09 points, or 0.39 percent, at 13,168.60 at the close. The Nasdaq Composite Index ended up 25.95 points, or 0.87 percent, at 3,015.86 and Standard & Poor’s 500 Index rose 7.12 points, or 0.51 percent, to 1,401.35.

Overseas Market – FII Activity for Indian Equity & Debt Market

  • European shares closed at four months high on Monday, with shares driving gains on the back of recent U.S. economic data and hopes for fresh policy actions to help debt-market strugglers Spain and Italy.
  • Stronger-than-expected U.S. jobs data also lifted sentiment towards equity markets. As a result, the FTSEurofirst 300 index ended 0.4 percent higher at 1,085.79 points. Spain’s benchmark IBEX stockmarket index which was halted for several hours due to a technical glitch, rose 4.4 percent, while Italy’s FTSE MIB gained 1.5 percent on expectations that any support from the ECB to lower borrowing costs will help the economy.
  • On the flip side, U.S. stocks surged on Monday on ECB Speculation as German Chancellor Angela Merkel’s government backed the European Central Bank’s bond-buying plan. Hopes for fresh policy actions to help debt-market strugglers Spain and Italy buoyed the market sentiment as a result Spanish and Italian notes increased, while commodities reversed declines. The nonfarm payrolls report put traders in a good mood, after four days of being in a bad mood, of the market’s best session in more than a month. Sentiment brightened further with U.S. economic data. Among the individual stocks, Knight Capital Group Inc., the firm driven to the brink of bankruptcy by trading losses last week, tumbled 24 percent.
  • The three main indices closed in green after sentiments were brightened by better-than-expected July job date and improving economic date. Cheering the news, the Dow Jones Industrial Average gained 21.34 points, or 0.16 percent, to 13,117.51 at the close. The Nasdaq Composite Index ended up 22.01 points, or 0.74 percent, to end at 2,989.91 and Standard & Poor’s 500 Index rose 3.24 of a point, or 0.23 percent, to 1,394.23.
  • Crude oil opened the week with a 1.0 per cent gain at USD 92.30 per barrel. Natural gas also closed in positive terrain with 1 per cent gain at USD 2.91 per MMBtu as the weaker dollar gave them a boost.
  • Following the crude’s footsteps, Gold closed the day’s trading with 0.4 per cent gain at USD 1616.00 per ounce. However, Silver settled 0.3 per cent higher at USD 27.87 per ounce.

FII ACIVITY

    • On Monday, the FIIs continued to support Indian equity and debt market.
  • Gross equity purchased stood at Rs. 1,509.60 Crore and gross debt purchased stood at Rs. 179.00 Crore, while the gross equity sold stood at Rs. 1,341.90 Crore and gross debt sold stood at Rs. 139.60 Crore.
  • Therefore, the net investment of equity and debt reported were Rs. 167.70 Crore and Rs. 39.40.