Shares of oil exploration and production companies, metal and mining firms and telecom companies led modest gains for key benchmark indices. The barometer index, the S&P BSE Sensex gained 134.90 points or 0.51% at 26,366.09, as per provisional closing data. The 50-unit CNX Nifty gained 50.75 points or 0.64% at 7,999.70, as per provisional closing data. The Nifty provisionally settled below the psychological 8,000 mark. Earlier, the Nifty regained the psychological 8,000 mark after opening with an upward gap on positive cues from global markets.
Benchmark indices witnessed high volatility during the latter part of the trading session. After a sharp intraday rally triggered by firm Asian stocks, benchmark indices trimmed gains during the second half of the trading session as European stocks edged lower and trading in US index futures indicated a weak opening of US stocks later in the global day. The market breadth indicating the overall health of the market turned negative from positive in late trade.
Shares of public sector oil marketing companies fell as crude oil prices surged. Shares of oil exploration and production companies edged higher as crude oil prices surged.
In overseas markets, Chinese stocks led gains for Asian markets on speculation that China's government funds were supporting stock prices with their purchases. US stocks surged yesterday, 27 August 2015, on the back of upbeat economic data.
Meanwhile, Reserve Bank of India (RBI) said in its Annual Report for 2014-15 published yesterday, 27 August 2015, that inflation developments will warrant close and continuous monitoring as part of the overall disinflation strategy that requires inflation to be brought down to 5% by January 2017.
There was massive selling of Indian stocks by foreign portfolio investors (FPIs) yesterday, 27 August 2015. FPIs sold shares worth a net Rs 3347.35 crore yesterday, 27 August 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 2577.06 crore yesterday, 27 August 2015, as per provisional data released by the stock exchanges.
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As per provisional closing, the S&P BSE Sensex was up 134.90 points or 0.51% to 26,366.09. The index jumped 456.14 points at the day's high of 26,687.33 in morning trade, its highest level since 24 August 2015. The index gained 38.98 points at the day's low of 26,270.17 in late trade.
The CNX Nifty was up 50.75 points or 0.64% at 7,999.70, as per provisional closing. The index hit a high of 8,091.80 in intraday trade, its highest level since 21 August 2015. The index hit a low of 7,961.65 in intraday trade.
The BSE Mid-Cap index was up 21.03 points or 0.20% at 10,759.41. The BSE Small-Cap index was up 7.28 points or 0.07% at 10,992.82. Both these indices underperformed the Sensex.
The market breadth indicating the overall health of the market turned negative from positive in late trade. On BSE, 1,404 shares fell and 1,291 shares rose. A total of 110 shares were unchanged.
The total turnover on BSE amounted to Rs 3577 crore, higher than turnover of Rs 3015.30 crore registered during the previous trading session.
Shares of oil exploration and production companies edged higher as crude oil prices surged. ONGC (up 5.48%), Cairn India (up 4.05%), Oil India (up 2.89%) and Reliance Industries (up 0.17%) edged higher. A recovery in crude oil prices from a steep slide recently has eased concerns of lower realizations from crude sales.
Shares of public sector oil marketing companies (PSU OMCs) fell as crude oil prices gained. HPCL (down 0.22%) and Indian Oil Corporation (down 0.82%), edged lower. Higher crude oil prices along with a weaker rupee could increase under-recoveries of PSU OMCs on domestic sale of LPG and kerosene at controlled prices. A weak rupee raises cost of imports. The government has already freed pricing of petrol and diesel.
In the global commodities markets, Brent crude oil futures edged higher in volatile trade. Brent for October settlement was currently up 5 cents at $47.61 a barrel. The contract had risen $4.42 a barrel or 10.25% to settle at $47.56 a barrel during the previous trading session. The solid rally overnight materialized on the back of upbeat US GDP growth data.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was currently hovering at 66.14, compared with its close of 66.04 during the previous trading session.
BPCL fell 2.41% to Rs 860.90 as the stock turned ex-dividend for dividend of Rs 22.50 per share for the year ended 31 March 2015.
Meanwhile, Reserve Bank of India (RBI) said in its Annual Report for 2014-15 published yesterday, 27 August 2015, that inflation developments will warrant close and continuous monitoring as part of the overall disinflation strategy that requires inflation to be brought down to 5% by January 2017. Regarding the outlook for the economy for the current fiscal year, the RBI said uncertainty surrounding the progress and distribution of the monsoon remains a risk to the outlook for both growth and inflation. The RBI said that the government's resolve on fiscal consolidation should propel efforts to reach the target for the gross fiscal deficit for 2015-16 at 3.9% of GDP. The RBI said that the current account deficit is likely to be contained at below 1.5% of GDP in 2015-16.
The central bank said that the outlook for capital flows is highly uncertain in the backdrop of a widely anticipated normalisation of the US monetary policy later during calendar year 2015. Increase in US interest rates for the first time in a decade will trigger capital outflows from emerging markets, the RBI said.
Meanwhile, India's weather office India Meteorological Department (IMD), said in a daily report issued yesterday, 27 August 2015, that for the country as a whole, cumulative rainfall during this year's monsoon season was 12% below the Long Period Average (LPA) until 27 August 2015. Region wise, the rainfall was 20% below the LPA in South Peninsula, 15% below the LPA in Central India, 7% below the LPA in Northwest India and 6% below the LPA in East & Northeast India, until 27 August 2015.
Separately, the IMD in its weekly report released yesterday, 27 August 2015, said that as per its extended range forecast till 13 September 2015, normal to above normal rainfall activity is likely over east and northeast India during next 7 days. Below normal rainfall activity is likely over many parts of northwest, westcentral and central India during next two weeks, the IMD said. The IMD further said there is a possibility of normal to slightly above normal rainfall activity over south peninsula between 4 to 13 September.
The June-September southwest monsoon is critical for the country's agriculture because a considerable part of the country's farmland is dependent on the rains for irrigation.
In overseas markets, European stocks edged lower today, 28 August 2015. Key benchmark indices in Germany, UK and France were off 0.13% to 0.68%.
Asian stocks edged higher today, 28 August 2015, after US stocks surged overnight on the back of upbeat economic data. Key benchmark indices in Indonesia, Singapore, South Korea and Taiwan were up by 0.35% to 2.49%.
Stocks surged in mainland China on speculation that China's government funds were supporting stock prices with their purchases. The Shanghai Composite jumped 4.82%. In Hong Kong, the Hang Seng index was off 1.04%.
In Japan, the Nikkei 225 Average jumped 3.03% to settle at 19,136.32. The latest data showed Japan's primary inflation gauge was flat in July. The core consumer price index was unchanged from a year earlier in July after a modest 0.1% increase in the previous month, the government said today, 28 August 2015. Core inflation has softened since peaking at 1.5% in April last year, driven lower by drops in global oil prices and Japan's sluggish domestic demand.
Separately, household spending fell 0.2% from a year earlier in July, adjusted for price changes, after slipping 2.0% in the previous month, according to the latest data. The unemployment rate was at 3.3% last month, down 0.1% from the previous month.
Trading in US index futures indicated that the Dow could fall 142 points at the opening bell today, 28 August 2015. US stocks surged yesterday, 27 August 2015, as China showed signs that measures to stabilize its economy and stock market may be taking hold. US GDP expanded by 3.7% between April and June, up from the previous estimate of 2.3%, according to the Commerce Department. Initial jobless claims dropped by 6,000 for the week ending in 22 August 2015 to a seasonally adjusted 271,000, according to the Department of Labor. Together, the brighter reports may be giving investors confidence that the US economy could withstand a continuing slowdown in China.
The weekend will bring the Federal Reserve's annual conference in Jackson Hole, Wyo., where the central bank might offer fresh clues about a possible interest-rate hike. Kansas City Fed President Esther George yesterday, 27 August 2015, said the market turmoil complicates any decision to raise rates. Yet, she repeated her long-held call for a rate increase.
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