Volatility ruled the roost in morning trade as the key benchmark indices recovered from lower level after erasing almost entire gains after an initial surge which took the barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, to record high. The Sensex was up 55.41 points or 0.25%, off 94.19 points from the day's high and up 45.42 points from the day's low. The market breadth, indicating the overall health of the market, was strong. The BSE Mid-Cap index was up more than 1%. The market sentiment was boosted by data showing that foreign institutional investors (FIIs) made massive purchases of Indian stocks on Thursday, 27 March 2014.
Index heavyweight and cigarette major ITC fell in choppy trade. Reliance Industries (RIL) gained after the company's spokesperson Umesh Upadhyay after market hours on Thursday, 27 March 2014, said that the FIR relating to gas contracts filed by former Delhi Chief Minister Arvind Kejriwal against the Union Government was completely illegal. Metal and mining stocks edged higher on growing expectations that China will take steps to stimulate its sagging economy. Shares of aluminium major Hindalco Industries hit 52-week high.
High volatility was witnessed at the onset of the trading session as key benchmark indices trimmed an initial rally triggered by firm Asian stocks. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit record high. Volatility ruled the roost in morning trade as the key benchmark indices recovered from lower level after erasing almost entire gains after an initial surge.
The market sentiment was boosted by data showing that foreign institutional investors (FIIs) made massive purchases of Indian stocks on Thursday, 27 March 2014. Foreign institutional investors (FIIs) bought shares worth a net Rs 2191.93 crore on Thursday, 27 March 2014, as per provisional data from the stock exchanges.
Asian stocks edged higher on Friday, 28 March 2014, as recent weaker economic data from China has raised expectations that China will take steps to stimulate its sagging economy.
At 10:15 IST, the S&P BSE Sensex was up 55.41 points or 0.25% to 22,269.78. The index jumped 149.60 points at the day's high of 22,363.97 in early trade, a record high for the barometer index. The index rose 9.99 points at the day's low of 22,224.36 in morning trade.
The CNX Nifty was up 22.15 points or 0.33% to 6,663.90. The index hit a high of 6,684.95 in intraday trade, a record high for the index. The index hit a low of 6,650.25 in intraday trade.
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The market breadth, indicating the overall health of the market, was strong. On BSE, 1,249 shares gained and 553 shares fell. A total of 85 shares were unchanged.
The BSE Mid-Cap index was up 69.47 points or 1.01% at 6.979.14. The BSE Small-Cap index was up 48.09 points or 0.7% at 6,964.59. Both these indices outperformed the Sensex.
The total turnover on BSE amounted to Rs 678 crore by 10:15 IST, compared with Rs 238 crore by 09:30 IST.
Among the 30-share Sensex pack, 23 stocks gained and rest of them declined.
Index heavyweight and cigarette major ITC fell 1.01% to Rs 356.30. The stock hit high of Rs 361.85 and low of Rs 356.25 so far during the day.
Reliance Industries (RIL) rose 1.44% to Rs 915.15, with the stock reversing initial fall. The stock hit high of Rs 918.55 and low of Rs 899.60 so far during the day. RIL spokesperson Umesh Upadhyay after market hours on Thursday, 27 March 2014, said that the FIR relating to gas contracts filed by former Delhi Chief Minister Arvind Kejriwal against the Union Government was completely illegal. The Constitution clearly spells out the division of power between and Centre and State very unambiguously. Mr. Upadhyay said he spoke with constitutional expert and former Secretary General of Lok Sabha, Dr. Subhash Kashyap on the issue.
Dr. Kashyap said that Delhi is a centrally administered Union Territory and the President is supposed to be administering it through the Lt. Governor. As a concession to the political forces in Delhi and to the public opinion, a council of ministers and a legislature was conceded to Delhi. But entirely unlike a state legislature, their powers are very clearly defined and delimited by the Constitution and by the NCT act, Dr. Kashyap said. They do not take away the powers of the Union Parliament and Union Government over the territory of Delhi and even in the State list, the Parliament remains fully authorized to make laws and if there is a contradiction in the laws made by the Parliament and the Delhi Legislative Assembly even in the State list it is the Union law that prevails, Dr. Kashyap said.
Just two days prior to quitting from his position, the then Delhi Chief Minister Arvind Kejriwal ordered an FIR with the Anti-Corruption Bureau of Delhi, which reports to him and not Delhi police which is under the Ministry of Home Affairs, Mr. Upadhyay said. It is clear that neither he was keen on fighting corruption nor willing to follow due legal process, Mr. Upadhyay said. He had an eye on the forthcoming Lok Sabha elections, Mr. Upadhyay said.
Metal and mining stocks edged higher on growing expectations that China will take steps to stimulate its sagging economy. China is the world's largest consumer of copper and aluminum.
Tata Steel (up 1.09%), Steel Authority of India (Sail) (up 0.39%), NMDC (up 0.16%), JSW Steel (up 0.19%), Sesa Sterlite (up 2%), Hindustan Copper (up 1.06%) and Hindustan Zinc (up 1.33%) gained.
Hindalco Industries rose 2.04% to Rs 127.80 after hitting 52-week high of Rs 128.60 in intraday trade.
Jindal Steel & Power (down 0.52%) and National Aluminum Company (down 0.65%) declined.
In the foreign exchange market, the rupee edged higher against the dollar as hopes for continued foreign investor inflows send domestic shares to a string of record highs. The partially convertible rupee was hovering at 60.075, compared with its close of 60.31/32 on Thursday, 27 March 2014.
The Reserve Bank of India (RBI) on Thursday, 27 March 2014, relaxed some of the forex hedging rules for importers and exporters, to allow greater operational flexibility. Importers and exporters can cancel up to 75% of their hedged forex exposures, as against 25% earlier, the RBI said. In addition, the profit or loss from these cancellations will be borne by the importer/exporter instead of passing it on to the customers as was mandated earlier.
The Reserve Bank of India will announce the First Bi-monthly Monetary Policy Statement, 2014-15 on 1 April 2014. Citing price pressures, the Reserve Bank of India raised its key lending rates by 25 basis points after Third Quarter Review of Monetary Policy for 2013-14 on 28 January 2014.
The next major trigger for the stock market is the outcome of the upcoming Lok Sabha elections. Lok Sabha elections will be held between 7 April 2014 and 12 May 2014 in nine phases. The counting of votes will take place on 16 May 2014. The term of the current Lok Sabha expires on June 1 and the new House has to be constituted by May 31. Along with the Lok Sabha election, Andhra Pradesh (AP), including the regions comprising Telangana, Odisha and Sikkim will go to polls to elect new assemblies. AP, Odisha and Sikkim assemblies come to end on June 2, June 7 and May 7 respectively.
Asian stocks edged higher on Friday, 28 March 2014, as recent weaker economic data from China has raised expectations that China will take steps to stimulate its sagging economy. Key benchmark indices in Hong Kong, China, Singapore, Japan, Indonesia and South Korea were up 0.02% to 1.28%. In Taiwan, the Taiwan Weighted index was off 0.07%.
Chinese Premier Li Keqiang said the country has policies in reserve to deal with any economic volatility this year and can't ignore "difficulties and risks" from a slowdown, according to a central-government website statement.
Japan's consumer price index stripped of perishables and energy rose 0.8% in February 2014, the most since 1998, a report showed. Household spending fell 2.5% in February from a year earlier, the first drop in six months.
Trading in US index futures indicated that the Dow could advance 19 points at the opening bell on Friday, 28 March 2014. US stock market extended losses for the second day and finished lower Thursday, amid concerns that improving economic indicators might force the Fed to start raising rates sooner than anticipated.
Government data showed that the economy's growth in the fourth quarter was bumped up to 2.6%, mainly because of higher health-care spending, while weekly unemployment benefits fell to the lowest level in four months, offering further evidence that US layoffs have slowed sharply and perhaps a hint that hiring is about to pick up.
Slumping for an eighth month, a guage of pending home sales fell 0.8% in February to the lowest level in more than two years, signaling that upcoming activity may slow, the National Association of Realtors reported.
Separately, the Labor Department said the number of individuals filing for initial jobless benefits in the US last week declined by 10,000 to a 311,000 from the previous week's revised total of 321,000.
Cleveland Fed president Sandra Pianalto on Thursday, 27 March 2014, said "no single data point will determine how long the Federal Reserve can keep short-term interest rates low." "We will be watching labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial developments. It is a complicated world out there," Pianalto said.
The Federal Reserve seems to be doing a better job communicating with markets now than it did last summer, according to William Dudley, president of the central bank's New York branch, on Thursday, 27 March 2014.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 29-30 April 2014. The Federal Reserve on 19 March 2014 said after the conclusion of a monetary policy review that it will trim its monthly bond purchases by $10 billion to $55 billion. The Federal Reserve will end its bond-buying program before the end of the year with an interest-rate increase likely to follow in "around six months," Chair Janet Yellen said on 19 March 2014. Quarterly Fed forecasts on 19 March 2014 showed more officials predicting that the benchmark interest rate, now close to zero, will rise to at least 1% by the end of 2015 and 2.25% a year later.
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