Key benchmark indices held firm in morning trade as higher Asian stocks boosted sentiment. The barometer index, the S&P BSE Sensex, was up 128.48 points or 0.63%, up close to 135 points from the day's low and off about 25 points from the day's high. Index heavyweight and cigarette major ITC trimmed initial gains. Another index heavyweight Reliance Industries (RIL) extended initial gains. The market breadth, indicating the overall health of the market, was strong.
Auto stocks rose on expectations that the RBI may further cut policy rates to perk up economic growth after the latest data showed a sharp fall in wholesale price inflation in April 2013. Mahindra & Mahindra and Maruti Suzuki India hit record high.
The market edged higher in early trade on firm Asian stocks. The barometer index, the S&P BSE Sensex hit highest level in over 28 months. The 50-unit CNX Nifty hit over 30 month high. It held firm in morning trade.
The market sentiment was also boosted by data showing that foreign funds remained net buyers of Indian stocks on Friday, 17 May 2013. Foreign institutional investors (FIIs) bought shares worth a net Rs 867.93 crore on Friday, 17 May 2013, as per provisional data from the stock exchanges.
At 10:30 IST, the S&P BSE Sensex was up 128.48 points or 0.63% to 20,414.60. The index rose 155.70 points at the day's high of 20,441.82 in early trade, its highest level since 5 January 2011. The index fell 8.36 points at the day's low of 20,277.76 in opening trade.
The CNX Nifty was up 31.50 points or 0.51% to 6,218.80. The index hit a high of 6,229.45 in intraday trade, its highest level since 11 November 2010. The index hit a low of 6,195.25 in intraday trade.
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The market breadth, indicating the overall health of the market, was strong. On BSE, 1,019 shares advanced and 503 shares declined. A total of 48 shares were unchanged.
Among the 30-share Sensex pack, 23 stocks rose and the rest of them fell.
Index heavyweight Reliance Industries (RIL) rose 1.09% to Rs 843.50. The stock hit high of Rs 844.70 and low of Rs 835.15 so far during the day.
Index heavyweight and cigarette major ITC rose 0.81% to Rs 337.25. The stock hit high of Rs 342.20 and low of Rs 335.50 so far during the day. The stock had hit record high of Rs 355 in intraday trade on 11 May 2013. The company's net profit rose 19.43% to Rs 1927.98 crore on 19.12% growth in total income to Rs 8511.38 crore in Q4 March 2013 over Q4 March 2012. The result was announced during market hours on Friday, 17 May 2013. ITC's net profit rose 20.38% to Rs 7418.39 crore on 18.74% growth in total income to Rs 30839.97 crore in the year ended March 2013 over the year ended March 2012.
On a consolidated basis, ITC's net profit rose 21.57% to Rs 7608.07 crore on 19.02% growth in total income to Rs 32505.14 crore in the year ended March 2013 over the year ended March 2012.
ITC's board of directors at its meeting held on Friday, 17 May 2013, recommended a dividend of Rs 5.25 per share for the financial year ended 31 March 2013.
Auto stocks rose on expectations that the RBI may further cut policy rates to perk up economic growth after the latest data showed a sharp fall in wholesale price inflation in April 2013. Lower interest rates may help revive demand for vehicles. Purchases of automobiles, including that of cars, utility vehicles and commercial vehicles are substantially driven by financing.
Tata Motors jumped 3.51%. The company said on Saturday, 18 May 2013 that TML Holdings, a wholly owned subsidiary of the company, issued and allotted S$350 million in principal amount of 4.25% senior notes due 2018. The net proceeds from the issue will be used for the redemption of preference shares issued to Tata Motors and for general corporate purposes. Australia and New Zealand Banking Group, Citigroup Global Markets Singapore, Deutsche Bank AG, Singapore Branch and Standard Chartered Bank acted as joint lead managers and joint bookrunners for the issue.
This announcement does not constitute nor form a part of any offer or solicitation to purchase or subscribe for securities in Singapore, the United States, India or elsewhere, company said. The Notes, when offered, will not be sold or made the subject of an invitation for subscription or purchase, whether directly or indirectly, to any person in Singapore other than (i) to an institutional investor pursuant to Section 274 of the Securities and Futures Act (Chapter 289 of Singapore) (SFA), (ii) to a relevant person pursuant to Section 275(1), or any person pursuant to Section 275(1A), and in accordance with the conditions specified in Section 275, of the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.
The Notes have not been and will not be sold or made the subject of an invitation for subscription or purchase, whether directly or indirectly, to any person in India. The Notes have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the Securities Act), or the laws of any state of the United States. Consequently, the Notes may not be offered, sold or otherwise transferred within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state laws. No public offering of the Notes is being or will be made in the United States.
India's largest car maker by sales, Maruti Suzuki India rose 3.26% to Rs 1765.45. The stock hit record high of Rs 1769.25 in intraday trade today, 20 May 2013. The stock surged recently on the back of a weakening yen. Weak yen could boost earnings of Maruti Suzuki as it imports raw materials from its Japanese parent Suzuki Motor Corporation. It also pays annual royalty on sales to the Japanese parent.
Mahindra & Mahindra (M&M) rose 2.93% to Rs 1014.35. The stock hit record high of Rs 1016.70 in intraday trade today, 20 May 2013.
Two wheeler markers also gained. Bajaj Auto rose 1.34%. The company's net profit fell 1% to Rs 766 crore on 4% rise in turnover to Rs 4990 crore in Q4 March 2013 over Q4 March 2012. Net profit rose 1% to Rs 3044 crore on 3% growth in turnover to Rs 20793 crore in the year ended 31 March 2013 (FY 2013) over the year ended 31 March 2012 (FY 2012). The result was announced during trading hours on Thursday, 16 May 2013.
Bajaj Auto said that the company's performance in FY 2013 was good in a very difficult year for the automobile industry. The company's strategy to build strong brands and offer differentiated products in the front-end, and focus on cost and productivity improvements in the back-end, has yielded desired results, Bajaj Auto said.
India's largest motorcycle maker by sales, Hero MotoCorp gained 1.14%. The company said on 1 May 2013 its total sales fell 9.5% to 4.99 lakh in April 2013 over April 2012.
As per the Q4 results calendar, L&T unveils Q4 results on 22 May 2013. Tata Steel, State Bank of India and Bharat Heavy Electricals (Bhel) unveil Q4 results on 23 May 2013. Coal India unveils consolidated FY 2013 results on 27 May 2013. Sun Pharma, Power Grid Corporation of India, GAIL (India) and Hindalco Industries unveil Q4 results on 28 May 2013. Tata Motors, ONGC, NMDC and BPCL unveil Q4 results on 29 May 2013. M&M and Tata Power unveil Q4 results on 30 May 2013.
Global credit rating agency Standard & Poor's (S&P) on Friday, 17 May 2013, affirmed India's sovereign rating at BBB-minus with a negative outlook, reiterating there was a one-in-three chances of a ratings downgrade over the next 12 months. S&P said the government's ability to prop up investment growth remains uncertain. The ratings agency, however, said there was scope to upgrade the sovereign ratings if the government unleashes public and private investments to spur economic growth.
The monsoon rains may arrive on the southern coast around 3 June 2013, the weather office forecast on 15 May 2013. The rains, which run from June to September, are vital for the 55% of farmland without irrigation in India, one of the world's largest producers and consumers of food. The India Meteorological Department (IMD) has predicted normal rains this year.
The Reserve Bank of India (RBI) undertakes mid-quarter review of the monetary policy on 17 June 2013. RBI Governor D Subbarao on 14 May 2013 said that the central bank will take note of falling inflation when discussing potential interest rate cuts. The RBI on 3 May 2013 cut its key policy rate viz. the repo rate by 25 basis points (bps) to 7.25% and kept the cash reserve ratio (CRR) for banks unchanged at 4% after a monetary policy review. RBI said at that time that the balance of risks stemming from its assessment of the growth-inflation dynamic provides little space for further monetary easing. The RBI said it will endeavour to condition the evolution of inflation to a level of 5% by March 2014, using all instruments at its command.
The finance ministry in October 2012 announced a five-year plan to cut fiscal deficit. The government hopes to reduce the fiscal deficit to 3% by March 2017.
Asian stock markets edged higher on Monday boosted by US equities hitting record closing highs on Friday as encouraging economic data prompted investors to buy into growth companies. Key benchmark indices in China, Hong Kong, Indonesia, Japan, and Taiwan rose by 0.04% to 1.7%. Key benchmark indices in Singapore and South Korea fell by 0.01% to 0.07%.
Thailand's growth was slower than economists estimated in the first quarter as exports cooled, boosting the case for the central bank to cut interest rates. Gross domestic product increased 5.3% in the three months through March from a year earlier, after expanding a revised 19.1% in the previous quarter, the National Economic and Social Development Board said in Bangkok today.
Trading in US index futures indicated a flat opening of US stocks on Monday, 20 May 2013. US stocks rose on Friday, advancing to a fourth weekly gain, with both the Dow Jones Industrials Average and the S&P 500 at their all-time closing high as gauges for leading indicators and consumer sentiment advanced more than estimated. The index of U.S. leading indicators climbed in April, a rebound from March that suggests the world's largest economy may be poised for further expansion. The Conference Board's gauge of the outlook for the next three to six months climbed 0.6% last month after falling a revised 0.2% in March that was steeper than previously reported, the New York-based group said. Americans' confidence in the economy climbed in May to the highest level in almost six years as rising real estate values and record stock prices boosted household wealth.
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