After extending initial gains, key benchmark indices trimmed gains in mid-morning trade. The barometer index, the S&P BSE Sensex, was currently was up 125.49 points or 0.48% at 26,439.48. Key indices rose on reports that some progress was made on proposed goods and services tax (GST) after the empowered committee of state finance ministers on Wednesday, 20 August 2014, decided the common threshold for levy of GST. The market breadth indicating the overall health of the market was strong, with more than two gainers for every loser on BSE. The BSE Mid-Cap and Small-Cap indices rose more than 1% each. Both these indices outperformed the Sensex. Bank stocks gained, with Kotak Mahindra Bank scaling record high. Asian stocks were in red after a preliminary survey showed that manufacturing activity in China weakened in August to a three-month low.
At 11:16 IST, the S&P BSE Sensex was up 125.49 points or 0.48% at 26,439.48. The index jumped 150.51 points at the day's high of 26,464.80 in mid-morning trade. The index fell 12.03 points at the day's low of 26,302.26 in early trade.
The CNX Nifty was up 12.45 points or 0.43% to 7,909.10. The index hit a high of 7,919.65 in intraday trade. The index hit a low of 7,868.15 in intraday trade.
The market breadth indicating the overall health of the market was strong, with more than two gainers for every loser on BSE. 1,624 shares gained and 761 shares fell. A total of 86 shares were unchanged.
The BSE Mid-Cap index was up 95.02 points or 1.02% at 9,371.36. The BSE Small-Cap index was up 112.54 points or 1.1% at 10,376.05. Both these indices outperformed the Sensex.
Bank stocks gained. Among PSU bank stocks, State Bank of India (SBI) (up 1.83%), Canara Bank (up 2.98%), Union Bank of India (up 3.94%), Bank of India (up 2.35%), Punjab National Bank (up 1.77%) Syndicate Bank (up 1.63%), Indian Overseas Bank (up 1.88%), Andhra Bank (up 1.68%), Oriental Bank of Commerce (up 1.44%), Dena Bank (up 1.83%), and Indian Bank (up 1.81%) gained.
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Among private sector banks, ICICI Bank (up 0.68%), HDFC Bank (up 0.49%), IndusInd Bank (up 0.41%), Yes Bank (up 0.01%), Federal Bank (up 1.91%), and Axis Bank (up 1.36%), gained.
Kotak Mahindra Bank rose 2.31% to Rs 1,020 after hitting record high of Rs 1,021 in intraday trade. The bank said during market hours that Kotak Trustee Company, a promoter group entity of Kotak Mahindra Bank, sold 16 lakh shares of the bank today, 21 August 2014. The above sale has been undertaken pursuant to RBI's requirement to reduce the promoter shareholding in the bank, has today, 21 August 2014 said.
Claris Lifesciences jumped 3.51% after the company said it has received the MHRA approval for its newly commissioned plant. The announcement was made before market hours today, 21 August 2014. Claris Lifesciences announced that it received the MHRA approval for its newly commissioned plant (plant 2). This will help in enhancing capacities to grow in the regulated markets, especially the European Union.
Bosch rose 1.3% after the company said workers at Jaipur plant called off tool down strike from Wednesday, 20 August 2014. Workmen at Bosch's Jaipur plant had resorted to an illegal tool down strike from end of second shift of Monday, 18 August 2014, without giving any prior notice to the management. Efforts were made to resolve the matter with the union and restore normalcy. Work has resumed from second shift on 20 August 2014, the company said in a statement.
In the foreign exchange market, the rupee was slightly lower against the dollar after hawkish minutes from the latest Federal Reserve Policy meeting showed that the US central bankers were surprised at the speed of the jobs recovery. The partially convertible rupee was hovering at 60.63, compared with its close of 60.62 on Wednesday, 20 August 2014.
The empowered committee of state finance ministers on Wednesday, 20 August 2014, reportedly decided that the common threshold for levy of goods and services tax (GST) would be kept at Rs 10 lakh in general category states and Rs 5 lakh in special category states. This means GST will be levied on all retailers and service providers with a turnover of more than Rs 10 lakh in general category states and Rs 5 lakh in special category states. The decision removes a key stumbling block in the finalisation of the GST structure and is expected to speed up the talks on implementation of the tax reform. However, significant differences still persist between the Centre and the states regarding GST, reports suggest. GST, a major indirect tax reform, will replace service tax, excise, state value-added tax and a number of other local levies.
Meanwhile, India's macroeconomic worries have eased on falling crude oil prices. India imports about 80% of its crude oil requirement. Brent dropped to below $102 a barrel as concerns over excess oil supply and slowing demand weighed on prices. The October Brent crude contract was down 33 cents at $101.95 a barrel. The contract gained 72 cents a barrel to settle at $102.28 a barrel yesterday, 20 August 2014. Brent had hit 14-month low of $101.07 a barrel early this week.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 251.36 crore on Wednesday, 20 August 2014, as per provisional data from the stock exchanges.
The Union Cabinet on Wednesday, 20 August 2014, at a meeting chaired by the Prime Minister, Narendra Modi gave its approval for Digital India - a programme to transform India into digital empowered society and knowledge economy. The programme will be implemented in phases from the current year till 2018. The Digital India is transformational in nature and would ensure that Government services are available to citizens electronically. It would also bring in public accountability through mandated delivery of government's services electronically, a Unique ID and e-Pramaan based on authentic and standard based interoperable and integrated government applications and data basis, a government statement said.
Asian shares fell today, 21 August 2014, as a disappointing survey on Chinese manufacturing stoked concerns about the regional giant. Key benchmark indices in Taiwan, Hong Kong, Indonesia, China, and South Korea were off 0.41% to 1.38%. Key benchmark indices in Japan and Singapore were up 0.05% to 0.78%.
The HSBC/Markit Flash China Manufacturing Purchasing Managers' Index (PMI) fell to 50.3 in August from July's 18-month high of 51.7, missing forecasts.
Trading in US index futures indicated that the Dow could fall 2 points at the opening bell on Thursday, 21 August 2014. Most US stocks closed higher on Wednesday, 20 August 2014, shaking off a dip that came after Federal Reserve minutes indicated that policy makers talked at their last meeting about a sooner-than-anticipated hike to interest rates.
The minutes from the two-day meeting of the Federal Open Market Committee in late July showed that Fed officials came closer to an agreement on how to exit from the most aggressive stimulus in the Fed's 100-year history. At that meeting, the Fed trimmed its monthly bond-buying program by an additional $10 billion. The minutes showed that some participants were increasingly uncomfortable with the committee's forward guidance on keeping its benchmark rate low for a "considerable time,". Many participants said they might have to raise borrowing costs sooner than they had anticipated.
Federal Reserve Chairwoman Janet Yellen will give a speech tomorrow, 22 August 2014, at the annual Fed summit in Jackson Hole, Wyo. Fed Chair Janet Yellen is reportedly expected to acknowledge during the conference that while economic data has generally been supportive, she remains concerned about slack in the labor market.
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