A range bound movement was witnessed as key benchmark indices retained positive zone in mid-afternoon trade. The barometer index, the S&P BSE Sensex, was currently up 106.46 points or 0.40% at 26,536.31. The market breadth indicating the overall health of the market was positive. The market sentiment was upbeat after provisional data released by the stock exchanges after trading hours yesterday, 20 October 2014, showed that foreign portfolio investors (FPIs) bought shares worth a net Rs 1040.08 crore on that day.
Shares of metal and power generation companies rose after the Narendra Modi government yesterday, 20 October 2014, announced that it will auction 74 coal-mining licenses to private companies in the next three to four months after the Supreme Court last month canceled 214 coal licenses issued to private and public companies since 1993.
HDFC Bank edged higher in volatile trade after reporting good Q2 results. Financial Technologies (India) (FTIL) tumbled after the government ordered the merger of National Spot Exchange (NSEL) with its holding company Financial Technologies (India) in public interest.
Earlier, key indices had reversed intraday gains in afternoon trade. Before that the benchmark indices had extended initial gains in morning trade that took the Sensex and the 50-unit CNX Nifty to their highest level in almost two weeks.
In overseas markets, European shares rose, with a round of solid earnings report helping boost the mood after the recent selloff. Asian stocks dropped after the latest data showed that China's gross domestic product (GDP) rose 7.3% year-over-year in Q3 September 2014, marking its slowest pace of growth in five years.
In the foreign exchange market, the rupee edged higher against the dollar as key equity benchmark indices rose.
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Brent crude prices edged higher on news of robust Chinese oil demand.
At 14:25 IST, the S&P BSE Sensex was up 106.46 points or 0.40% at 26,536.31. The index jumped 185.56 points at the day's high of 26,615.41 in morning trade, its highest level since 9 October 2014. The index shed 22.85 points at the day's low of 26,407 in afternoon trade.
The CNX Nifty was up 40.15 points or 0.51% at 7,919.55. The index hit a high of 7,934.50 in intraday trade, its highest level since 9 October 2014. The index hit a low of 7,874.35 in intraday trade.
The BSE Mid-Cap index was up 64.90 points or 0.69% at 9,440.98, outperforming the Sensex. The BSE Small-Cap index was up 25.12 points or 0.24% at 10,388.57, underperforming the Sensex.
The market breadth indicating the overall health of the market was positive. On BSE, 1,449 shares rose while 1,200 shares declined. A total of 109 shares were unchanged.
Among the 30 Sensex shares, 21 rose and the remaining shares fell.
GAIL (India) (up 5.05%), Sesa Sterlite (up 4.44%), Bharat Heavy Electricals (up 4.17%), ICICI Bank (up 2.41%), Wipro (up 2.37%), Bharti Airtel (up 2.32%), NTPC (up 1.98%), Hero MotoCorp (up 1.94%) and Maruti Suzuki India (up 1.84%), edged higher from the Sensex pack.
ONGC (down 2.32%), Coal India (down 1.3%), Mahindra & Mahindra (down 1.18%), Infosys (down 0.77%), Dr Reddy's Laboratories (down 0.76%), Reliance Industries (down 0.58%) and Sun Pharmaceuticals Industries (down 0.56%) edged lower from the Sensex pack.
FTIL tumbled after the government ordered the merger of National Spot Exchange (NSEL) with its holding company Financial Technologies (India) in public interest. The stock was locked at 20% lower circuit on BSE at Rs 169.65. The members of the two companies, its creditors may provide suggestions/objections within a period of 60 days, the Ministry of Corporate Affairs said in a statement issued today, 21 October 2014.
HDFC Bank rose 0.28% to Rs 897.30. The stock hit a high of Rs 905.65 and a low of Rs 888. The bank's net profit rose 20.13% to Rs 2381.46 crore on 16.39% rise in total income to Rs 13894.73 crore in Q2 September 2014 over Q2 September 2013. The result was announced during trading hours today, 21 October 2014.
HDFC Bank's gross non-performing assets (NPAs) were at 1.02% of gross advances as on 30 September 2014, as against 1.09% as on 30 September 2013 and 1.07% as on 30 June 2014. Net non-performing assets were at 0.28% of net advances as on 30 September 2014 same as on 30 September 2013 and as on 30 June 2014. Total restructured loans (including applications received and under process for restricting) were at 0.1% of gross advances as of 30 September 2014 as against 0.2% as of 30 September 2013.
The bank's total capital adequacy ratio (CAR) as at 30 September 2014 (computed as per Basel III guidelines) stood at 15.7% as against a regulatory requirement of 9%. Tier-I CAR was 11.8%.
In the foreign exchange market, the rupee edged higher against the dollar as key equity benchmark indices rose. The partially convertible rupee was hovering at 61.29, compared with its close of 61.365 during the previous trading session.
Brent crude prices edged higher on news of robust Chinese oil demand. Brent for December settlement was up 78 cents at $86.18 a barrel. The contract had lost 76 cents or 0.9% to settle at $85.40 a barrel yesterday, 20 October 2014.
Meanwhile, Ashima Goyal, a member of the Reserve Bank of India's (RBI) technical advisory committee reportedly said yesterday, 20 October 2014, that the RBI may consider easing monetary policy as early as March after global crude prices fell to a four-year low this month. Real interest rates are becoming more and more positive, which would be severely disinflationary, and that means the RBI has to cut rates, Goyal said. The RBI's technical advisory committee makes policy recommendations to RBI Governor Raghuram Rajan.
Meanwhile, the Narendra Modi government yesterday, 20 October 2014, announced that it will auction 74 coal-mining licenses to private companies in the next three to four months after the Supreme Court last month canceled 214 coal licenses issued to private and public companies since 1993. The licenses will be auctioned to private-sector companies only for captive use. Finance Minister Arun Jaitley said allowing private-sector companies to mine coal to sell to others is something the government may consider in the future.
Mr. Jaitley said state-run, coal-consuming companies that want to mine for their own use won't have to compete against the private sector for coal licenses, especially in key industries such as power. The government will allocate government companies licenses without an auction.
The announcement to auction coal blocks comes close on the heels of the government announcing diesel price decontrol and increase in natural-gas tariffs over the weekend. The deregulation of diesel prices will reduce the government's fuel subsidy burden. Meanwhile, as a result of the gas price hike, the government will get additional revenue of approximately Rs 3800 crore per annum on account of higher royalty, higher profit petroleum and higher taxes.
European shares rose today, 21 October 2014, with a round of solid earnings report helping boost the mood after the recent selloff. Key indices in Germany, France and UK were up 0.39% to 0.68%.
Asian stocks edged lower today, 21 October 2014, after a mixed bag of Chinese economic data, including the slowest GDP growth in five years, and a drop in housing prices, but a better-than-expected gain for September industrial production. Key benchmark indices in China, Indonesia, Taiwan, Japan and South Korea were off 0.10% to 2.03%. However, key benchmark indices in Singapore and Hong Kong were up 0.08% to 0.37%.
China posted a 7.3% year-over-year quarterly growth rate, marking growth at its slowest pace in five years amid a slumping real-estate market and weak domestic demand and industrial production. Value-added industrial output in China rose by a larger-than-expected 8% in September from a year earlier, accelerating from a 6.9% year-over-year increase in August, the statistics bureau said. Industrial production also increased 0.91% in September from August, when it rose 0.2% from the preceding month, it said.
Trading in US index futures indicated that the Dow could advance 5 points at the opening bell today, 21 October 2014. US equity investors began the week on an optimistic, albeit cautious, note on Monday, 20 October 2014, with gains in broader markets led by defensive sectors such as consumer staples and utilities.
The Federal Open Market Committee (FOMC) next undertakes a monetary policy review at a two-day meeting on 28-29 October 2014.
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