A slide in late trade pulled key benchmark indices lower. A sudden slide in late trade materialized after the benchmark indices moved in a narrow range for most part of the trading session. The market breadth indicating the overall health of the market turned negative from positive in late trade. IT and pharma stocks dropped. The barometer index, the S&P BSE Sensex, was provisionally off 149.11 points or 0.52% at 28,413.71. The BSE Mid-Cap index slipped into the red from green in late trade. Brent extended losses from a four-year low. Fall in global crude oil prices augur well for India as the nation imports about 80% of its crude oil requirements.
Index heavyweight and cigarette major ITC scaled record high, with the stock extending yesterday's rally triggered by reports the government may put on hold its plan to ban sales of single cigarettes. Steel Authority of India (Sail) dropped in volatile trade. IT stocks edged lower as the rupee edged higher against the dollar. Bank stocks edged lower in volatile trade. Shares of Axis Bank and Yes Bank reversed direction after scaling record high.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 474 crore yesterday, 4 December 2014, as per provisional data.
In overseas markets, European stocks rose after the latest data showed German industrial orders surpassed expectations significantly in October, pointing toward accelerating growth in Europe's largest economy. Chinese stocks led gains in Asian stocks after media reports said that China's banking sector regulator has issued draft rules for banks are aimed at reducing funding costs for businesses as the economy slows. US stocks fell from record levels yesterday, 4 December 2014, as the European Central Bank (ECB) decided to hold off on additional stimulus after a monthly monetary policy review.
In the foreign exchange market, the rupee edged higher against the dollar on increased selling of the US currency by exporters and banks amid persistent foreign capital inflows.
Brent extended losses from a four-year low after Saudi Arabia cut January prices for US and Asian buyers, bolstering speculation the country is defending its market share. Deregulation of diesel price announced by the Indian government in October 2014 and a sharp decline in global crude oil prices over the past few months will help reduce the government's fuel subsidy burden and help contain its fiscal deficit. The steep slide in global crude oil prices will also help India in containing its current account deficit and fuel price inflation. India imports 80% of its crude oil requirement.
As per provisional closing, the S&P BSE Sensex was down 149.11 points or 0.52% at 28,413.71. The index lost 153.77 points at the day's low of 28,409.05 in late trade, its lowest level since 3 December 2014. The index gained 88.93 points at the day's high of 28,651.75 in early trade.
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The CNX Nifty was down 26.10 points or 0.3% at 8,538.30. The index hit a low of 8,523.90 in intraday trade, its lowest level since 3 December 2014. The index hit a high of 8,588.35 in intraday trade.
The market breadth indicating the overall health of the market turned negative from positive in late trade. On BSE, 1,597 shares declined and 1,369 shares gained. A total of 92 shares were unchanged.
The BSE Mid-Cap index was off 27.53 points or 0.26% at 10,498.29. The fall the index was lower than Sensex's decline in percentage terms. The BSE Small-Cap index was up 3.44 points or 0.03% at 11,474.69, outperforming the Sensex.
The total turnover on BSE amounted to Rs 3603 crore, lower than Rs 4021.88 crore yesterday, 4 December 2014.
Index heavyweight and cigarette major ITC rose 2.05% to Rs 390.60 after scaling a record high of Rs 392.10 in intraday trade. The stock had jumped 5.44% to settle at Rs 382.75 yesterday, 4 December 2014, after media reports suggest that the government may put on hold its plan to ban sales of single cigarettes. It may be recalled that the health ministry had last month accepted a panel's proposal to ban loose cigarettes to deter smoking.
IT stocks edged lower as the rupee edged higher against the dollar. A firm rupee adversely affects operating profit margins of IT firms as the sector derives a lion's share of revenue from exports. TCS (down 2.3%), Infosys (down 1.83%), Wipro (down 2%), HCL Technologies (down 1.74%), Oracle Financial Services Software (down 2.58%) and Tech Mahindra (down 2.35%) declined.
Bank stocks edged lower in volatile trade. Among PSU bank stocks, Andhra Bank (down 0.62%), Canara Bank (down 0.51%), Bank of India (down 0.2%) and Union Bank of India (down 0.09%) declined. Bank of Baroda rose 1.39%.
State Bank of India (SBI) slipped 1.19% to Rs 316.45. The stock was volatile. The stock hit high of Rs 321 and low of Rs 316.25. The state-run bank during market hours today, 5 December 2014, said it has reduced the interest rate on retail term deposit below Rs 1 crore on select maturities with effect from Monday, 8 December 2014. The bank has reduced interest rate on term deposits for maturity between one year and less than five years to 8.5% from 8.75%. The bank has reduced interest rate on term deposits for maturity of five years and above to 8.25% from 8.5%.
Punjab National Bank rose 1.85% to Rs 1,115.15 after hitting a 52-week high of Rs 1,128.35 in intraday trade.
Among private bank stocks, ICICI Bank (down 0.53%), IndusInd Bank (down 0.01%) and ING Vysya Bank (down 0.33%). HDFC Bank (up 0.07%) and Kotak Mahindra Bank (up 1.29%),
Axis Bank shed 0.63% to Rs 496.80. The stock reversed direction after scaling record high of Rs 506 in intraday trade. Axis Bank announced after market hours yesterday, 4 December 2014, that it has closed its Senior Unsecured Redeemable Non-Convertible debenture issue of amount Rs 5705 crore and priced at 8.85% per annum payable annually maturing on 5 December 2024. The NCD's are rated AAA by CRISIL and ICRA. The NCDs are issued in Indian rupees at a fixed coupon and the proceeds shall be utilized for enhancing long term resources for funding infrastructure and affordable housing, Axis Bank said.
Yes Bank fell 1.35% to Rs 749.10. The stock reversed direction after scaling record high of Rs 766.85 in intraday trade.
Shares of Steel Authority of India (Sail) shed 2.46% at Rs 83.25. The stock was volatile. The stock hit high of Rs 84.70 and low of Rs 82.20. By 15:25 IST, bids were received for a total of 41.84 crore shares for the Offer for Sale (OFS) of the state-run steel company's shares by the government, as per data from the stock exchanges. The government put on the block 20.65 crore shares of Sail, representing a 5% stake through Offer for Sale (OFS) via the stock exchanges mechanism today, 5 December 2014. The OFS began at 9:15 IST and ended at 15:30 IST. The floor price for the offer for sale (OFS) was fixed at Rs 83 per share.
In the foreign exchange market, the rupee edged higher against the dollar on increased selling of the US currency by exporters and banks amid persistent foreign capital inflows. The partially convertible rupee was hovering at 61.86, compared with its close of 61.935 during the previous trading session.
Brent extended losses from a four-year low after Saudi Arabia cut January prices for US and Asian buyers, bolstering speculation the country is defending its market share. Brent for January settlement was off 42 cents a barrel at $69.22 a barrel. The contract had lost 28 cents a barrel to settle at $69.64 yesterday, 4 December 2014, the lowest close since May 2010.
Saudi Arabia's state-owned oil company Saudi Arabian Oil Co., also known as Saudi Aramco, yesterday, 4 December 2014, reduced its official selling prices for all oil grades bound for Asia in January by between $1.50 and $1.90 a barrel, compared with December. It also cut prices for all crude grades to the US by between 10 cents and 90 cents a barrel. Saudi Arabia is the biggest and most influential member of the Organization of the Petroleum Exporting Countries (OPEC), which late last month decided to maintain output levels despite a global oversupply.
Meanwhile, India's Ministry of Railways today, 5 December 2014, announced the setting up a High Level Committee (HLC) to identify factors, issues and avenues for improving financial health of Indian Railways. The HLC will examine the efficacy and sufficiency of the existing revenue structure in Indian Railways and avenue for raising revenues. The HCL will suggest ways and means for monetization of the resources of Indian Railway. The terms of reference of the HCL include identifying other sources of funding for meeting the long term modernization, expansion and updation needs of Indian Railways and avenues for reduction in expenditure of Indian Railways. The committee will submit its report by 21 December 2014.
The Indian government intends to get the Insurance Laws Amendment Bill that seeks to enhance FDI limit in capital starved insurance sector passed during the winter session of parliament which began on 24 November 2014. The government is also likely to introduce the constitutional amendment bill for the goods & services tax in the winter session of parliament.
European stocks edged higher today, 5 December 2014, after the latest data showed German industrial orders surpassed expectations significantly in October, pointing toward accelerating growth in Europe's largest economy. Key benchmark indices in UK, France and Germany were up 0.68% to 1.37%.
Industrial orders in Germany were significantly stronger than expected in October, driven by domestic demand and pointing toward accelerating growth in Europe's largest economy in the fourth quarter. Industrial orders rose 2.5% on the month of October in price, seasonal-and work-day-adjusted terms, the Ministry of Economy said today, 5 December 2014.
Meanwhile, Germany's central bank Bundesbank today, 5 December 2014, cut the nation's growth forecast for the current and coming years. Nonetheless, Bundesbank President Jens Weidmann said there is reason to hope that the current sluggish phase will prove to be short-lived. The Bundesbank now expects German adjusted growth in gross domestic product to be 1.4% in 2014, down from a forecast of 1.9% in June. It projects a growth rate of 0.8% in 2015, compared with 1.8% previously, and a rate of 1.5% in 2016, down from 1.7%. Weidmann said the recent sharp slide in crude oil prices has the effect of a small stimulus package in that it reduces both households' cost of living and companies' production cost. If crude oil prices remain at this subdued level for an extended period, economic growth in 2015 and 2016 could turn out to be between 0.1% and 0.2% higher in each case, Weidmann said.
The European Central Bank (ECB) left its key interest rate unchanged at 0.05% after a monthly monetary policy review yesterday, 4 December 2014, and announced that it will wait until 2015 to consider additional market supportive measures, including buying European sovereign debt.
Chinese stocks led gains in Asian stocks today, 5 December 2014, after media reports said that China's banking sector regulator has issued draft rules for banks are aimed at reducing funding costs for businesses as the economy slows. Key benchmark indices in China, Singapore, Hong Kong, Indonesia, and Japan were up 0.19% to 1.32%. South Korea's Kospi was flat. In Taiwan, the Taiwan Weighted index fell 0.2%.
Trading in US index futures indicated that the Dow could gain 25 points at the opening bell today, 5 December 2014. US stocks fell from record levels yesterday, 4 December 2014, as the European Central Bank (ECB) decided to hold off on additional stimulus after a monthly monetary policy review.
In economic news, US jobless claims in the week ended Nov. 29 fell by 17,000 to 297,000, the Labor Department said yesterday, 4 December 2014. US government's monthly nonfarm payrolls report for November will be out later in the global day today, 5 December 2014.
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