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Key indices extend gains

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Capital Market
Last Updated : Jun 26 2015 | 12:01 AM IST

After hovering in positive zone in early afternoon trade, key benchmark indices intraday extended gains in afternoon trade. The market breadth indicating the overall health of the market once again turned positive from negative. Earlier, the breadth had turned negative from positive in early afternoon trade. The barometer index, the S&P BSE Sensex, was currently up 116.52 points or 0.42% at 27,846.19. The gains in the Sensex in percentage terms were higher than those for the 50-unit CNX Nifty. The Nifty was currently up 28.70 points or 0.34% at 8,389.55.

Metal shares were mixed. Capital goods shares also depicted a mixed trend.

Meanwhile, Labour Minister Bandaru Dattatreya was quoted as saying in an interview to a news agency yesterday, 24 June 2015, that the Employees' Provident Fund Organisation (EPFO) will invest about $800 million in equities in the current fiscal year starting from July 2015.

Prime Minister Narendra Modi has expressed dismay at the delay in vital infrastructure projects due to repeated litigation and has asked concerned departments to proactively pursue these matters judicially and highlight the difficulties faced by the people due to the non-completion of these projects, according to a statement from the Prime Minister's Office (PMO) yesterday, 24 June 2015.

Meanwhile, Reserve Bank of India Governor Raghuram Rajan was quoted as saying at a conference in Stockholm yesterday, 24 June 2015, that Indian financial markets have the strength to withstand any fallout of a Greek default on its repayment obligations.

Indian stocks may remain volatile during the remaining part of the trading session today, 25 June 2015, as traders roll over positions in the futures & options (F&O) segment from the near month June 2015 series to July 2015 series. The near month June 2015 derivatives contracts expire today, 25 June 2015.

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Foreign portfolio investors (FPIs) bought shares worth a net Rs 92.57 crore yesterday, 24 June 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 13.52 crore yesterday, 24 June 2015, as per provisional data released by the stock exchanges.

In overseas stock markets, European shares edged lower in early trade there after a key meeting of eurozone finance ministers yesterday, 24 June 2015, yielded no agreement on Greece's reform plans. Asian stocks edged lower, tracking a negative lead from Wall Street after negotiations between Greece and its creditors hit a stalemate overnight. US stocks edged lower yesterday, 24 June 2015, as investors weighed the renewed impasse in the Greece debt talks and digested domestic data.

At 13:15 IST, the S&P BSE Sensex was up 116.52 points or 0.42% at 27,846.19. The index jumped 120.64 points at the day's high of 27,850.31 in afternoon trade. The index fell 93.91 points at the day's low of 27,635.76 in early trade, its lowest level since 22 June 2015.

The Nifty was up 28.70 points or 0.34% at 8,389.55. The index hit a high of 8,389.80 in intraday trade. The index hit a low of 8,329.50 in intraday trade, its lowest level since 22 June 2015.

The BSE Mid-Cap index was up 16.02 points or 0.15% at 10,633.40. The BSE Small-Cap index was up 12.50 points or 0.11% at 11,096.15. Both these indices underperformed the Sensex.

The market breadth indicating the overall health of the market once again turned positive from negative. Earlier, the breadth had turned negative from positive in early afternoon trade. On BSE, 1,217 shares rose and 1,214 shares dropped. A total of 121 shares were unchanged.

Metal shares were mixed. Hindustan Copper (up 7.85%), Vedanta (up 2.84%), Bhushan Steel (up 1.19%), Jindal Steel & Power (up 0.88%) and Hindalco Industries (up 0.77%), edged higher. JSW Steel (down 0.46%), Tata Steel (down 0.61%), Steel Authority of India (down 0.65%), Hindustan Zinc (down 1.07%) and National Aluminum Company (down 1.19%) edged lower.

NMDC was down 0.21%. MMTC was up 13.15%. The Union Cabinet yesterday, 24 June 2015, gave its approval to renew long term agreement with Japanese and South Korean steel mills for supply of high grade Indian iron ore during the three year period from April 2015 to March 2018. The quantities covered under the agreement will be in the range of 3.8 million tonnes to 5.5 million tonnes per year and will be supplied primarily from the mines of NMDC. The contract will be executed by MMTC.

Iron ore of higher grade have been supplied by India to Japan and South Korea under long term agreements during the last four to five decades. The renewal of long term agreement with Japanese and South Korean steel mills for supply of high grade Indian iron ore will help utilize surplus production of iron ore currently available in India. It will also strengthen Indo-Japanese collaboration in several areas of mutual interest, including technology transfer, joint venture, investment, etc, according to a government statement issued after trading hours yesterday, 24 June 2015.

Capital goods shares were mixed. ABB India (up 2.64%), AIA Engineering (up 2.64%), Bharat Heavy Electricals (up 1.38%), Jindal Saw (up 1.17%), Punj Lloyd (up 1.06%), Larsen & Toubro (up 1.01%), Alstom T&D India (up 0.95%), Siemens (up 0.62%), Crompton Greaves (up 0.52%), SKF India (up 0.20%) and Pipavav Defence and Offshore Engineering Company (up 0.08%), edged higher. ALSTOM India (down 0.4%), Thermax (down 0.48%), Bharat Electronics (down 0.69%), Suzlon Energy (down 1.11%), Lakshmi Machine Works (down 1.29%), BEML (down 1.92%), Praj Industries (down 2.59%) and Havells India (down 2.61%), edged lower.

Prime Minister Narendra Modi has expressed dismay at the delay in vital infrastructure projects due to repeated litigation and has asked concerned departments to proactively pursue these matters judicially and highlight the difficulties faced by the people due to the non-completion of these projects, according to a statement from the Prime Minister's Office (PMO) yesterday, 24 June 2015. The Prime Minister simultaneously complimented several state governments for the efforts that they were putting in to speed up infrastructure projects. The PMO said that the Prime Minister reviewed the progress of key infrastructure projects worth over Rs 60000 crore in the railway, road, power, coal, petroleum, and renewable energy sectors spread over several states including Jammu and Kashmir, Punjab, Haryana, Bihar, Jharkhand, Odisha, Chhattisgarh, Arunachal Pradesh, Tripura, Maharashtra and Karnataka.

Meanwhile, speaking at the launch of three major urban development initiatives viz. AMRUT (Atal Mission for Rejuvenation and Urban Transformation), Smart Cities Mission and Housing for All (Urban) at Vigyan Bhawan in New Delhi, Modi today, 25 June 2015, said that urbanization should be viewed as an opportunity and urban centres should be viewed as growth engines. Through AMRUT, the aim of the government is to give cities themselves the chance to plan their future growth, Modi said. The Prime Minister said urban and rural development in our country should be complimentary. One way of doing this was to ensure waste water management in urban areas, so that the treated water could be returned to rural areas for irrigation. Similarly, solid waste management could generate compost which could act as organic fertiliser for the surrounding rural areas.

The Ministry of Urban Development said in a statement that the guidelines released by Prime Minister at the launch of these three new urban missions allow the state government and Union Territories full liberty and flexibility in formulation, approval and execution of projects under the three missions. The two urban ministries have sought to ensure timely sanction and execution and certainty of resources for various projects and participation of citizens in identifying development needs under the new urban schemes. The central government has virtually withdrawn from the earlier practice of appraising and sanctioning individual projects, there by ending the scope for subjectivity and discretion, the Ministry of Urban Development said in a statement.

Meanwhile, Reserve Bank of India Governor Raghuram Rajan was quoted as saying in Stockholm at the Riksbank Macroprudential Conference yesterday, 24 June 2015, that the progress of the monsoon thus far has been quite strong. Rajan also reportedly said at the conference that India needs to "create more growth" and needs to grow still faster. Rajan said developments in Greece could affect the financial markets. But he also said the Indian financial markets have the strength to withstand any fallout of a Greek default on its repayment obligations. India's foreign exchange reserves are at a record high and investors have a positive outlook on the country, he said.

Meanwhile, the India Meteorological Department (IMD) said in its daily monsoon update issued yesterday, 24 June 2015, that the southwest monsoon has further advanced into most parts of north Arabian Sea, Gujarat state, some more parts of Madhya Pradesh and East Uttar Pradesh, remaining parts of Bihar, most parts of Himachal Pradesh and Uttarakhand, entire Jammu & Kashmir and some parts of Punjab and East Rajasthan. Conditions are favourable for further advance of southwest monsoon into remaining parts of Arabian sea and entire country during next 48 hours, the IMD said. The southwest monsoon was vigorous over Saurashtra & Kutch and Madhya Maharashtra and active over Gangetic West Bengal, Jharkhand, Gujarat Region, Konkan & Goa and South interior Karnataka during past 24 hours until 8:30 IST, the IMD said.

For the country as a whole, the cumulative rainfall during this year's monsoon season was 23% above the Long Period Average (LPA) until 23 June 2015. Region wise, the southwest monsoon was 51% above the LPA in Central India, 33% above the LPA in South Peninsula, 4% above the LPA in East & Northeast India and 7% below the LPA in Northwest India until 23 June 2015.

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 stock markets, European shares edged lower today, 25 June 2015, after a key meeting of eurozone finance ministers yesterday, 24 June 2015, yielded no agreement on Greece's reform plans. Key benchmark indices in UK, France and Germany were off 0.41% to 0.85%.

A Eurogroup meeting of eurozone finance ministers yesterday, 24 June 2015, ended after little over an hour as it became clear key differences over pension and other budget cuts remained between the international lenders and Greece's anti-austerity government. The finance ministers reportedly insisted that Greek Prime Minister Alexis Tsipras first has to agree on policy overhauls with the three international lenders overseeing Greece's bailout. Tsipras is scheduled to hold a meeting with the heads the International Monetary Fund, the European Commission and the European Central Bank today, 25 June 2015, with the hope of reaching an agreement. The Eurogroup will also continue their discussion on Greece in preparation for the EU summit of European leaders later in the day.

Greece needs a deal to unlock new financing ahead of a 1.54 billion euro ($1.75 billion) debt payment due to the International Monetary Fund (IMF) on 30 June 2015. On the same day, Greece's international bailout expires. A default on its international creditors-the IMF and other eurozone governments-could force Greece into a messy exit from the euro.

Asian stocks edged lower today, 25 June 2015, tracking a negative lead from Wall Street after negotiations between Greece and its creditors hit a stalemate overnight. Key indices in China, Japan, Hong Kong, Singapore, South Korea and Indonesia were off 0.02% to 3.46%. In Taiwan, the Taiwan Weighted index was up 0.84%.

China yesterday, 24 June 2015, announced new measures to stimulate lending. China will remove the loan-to-deposit ratio requirement of 75%, in a bid to lend out more to a slowing economy, the State Council announced yesterday, 24 June 2015, according to media reports.

US stocks closed lower yesterday, 24 June 2015 as investors weighed the renewed impasse in the Greece debt talks and digested domestic data. The Commerce Department said yesterday, 24 June 2015 that US' gross domestic product fell at a 0.2% annual rate in the January-March quarter instead of the 0.7% pace of contraction it reported last month.

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First Published: Jun 25 2015 | 1:10 PM IST

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