In what was a sudden reversal of direction, key benchmark slipped into the red from green in early afternoon trade. The market breadth indicating the overall health of the market turned negative from positive. The BSE Small-Cap and Mid-Cap indices, both, slipped into the red from green. High intraday volatility was witnessed in the Infosys counter on the eve of the announcement of its Q3 December 2014 results. The Sensex was currently off 24.62 points or 0.09% at 27,250.09. Asian stocks rose after overnight rally in US stocks.
Foreign portfolio investors sold shares worth a net Rs 466.78 crore yesterday, 8 January 2015, as per provisional data.
Shares of pharma firms advanced. Shares of travel and tour operators and hospitality firms advanced after Minister of State for Tourism, Culture and Civil Aviation Dr. Mahesh Sharma said that India is poised to receive one percent of global tourists in three years. Bharat Heavy Electricals dropped amid volatility.
Meanwhile, Finance Minister Arun Jaitley yesterday, 8 January 2015, said that domestic policies to achieve macro-economic balance and the on-going process of economic reforms would lend further strength to the recovery of the Indian economy.
In overseas markets, Asian stocks edged higher, taking cues from a surge on Wall Street overnight. US stocks surged yesterday, 8 January 2015, as two days of steady oil prices along with dovish comments by a Federal Reserve member helped further fuel a buying frenzy which begun on Wednesday 7 January 2015.
In the foreign exchange market, the rupee edged higher against the dollar.
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Brent crude futures edged higher amid speculation a slowdown in the US shale boom will reduce a glut that's driven prices to the lowest in 5-1/2-years.
At 12:16 IST, the S&P BSE Sensex was down 24.62 points or 0.09% at 27,250.09. The index declined 155.08 points at the day's low of 27,119.63 in early afternoon trade. The index surged 232.96 points at the day's high of 27,507.67 in early trade, its highest level since 6 January 2015.
The CNX Nifty was down 10.15 points or 0.12% at 8,224.45. The index hit a low of 8,190.80 in intraday trade. The index hit a high of 8,303.30 in intraday trade, its highest level since 6 January 2015.
The BSE Mid-Cap index was off 16.12 points or 0.15% at 10,404.51. The decline in the index was higher than the Sensex's decline in percentage terms. The BSE Small-Cap index was off 1.09 points or 0.01% at 11,184.79. The decline in the index was lower than the Sensex's decline in percentage terms.
The market breadth indicating the overall health of the market turned negative from positive in early afternoon trade. On BSE, 1,393 shares declined and 1,172 shares advanced. A total of 102 shares were unchanged.
High intraday volatility was witnessed in the Infosys counter on the eve of the announcement of its Q3 December 2014 results. The stock was off 0.84% at Rs 1,958. The stock hit a high of Rs 1,996.55 and a low of Rs 1,914.10 so far during the day. The company announces its Q3 December 2014 results at 12:30 noon today, 9 January 2015. Due to cross currency headwinds, analysts expects Infosys' management to today, 9 January 2015, prune the company's revenue growth guidance in dollar terms for the year ending 31 March 2015 (FY 2015). The IT major is widely expected to prune its FY 2015 dollar revenue growth to 7%-8%, from 7%-9%.
At the time of announcement of Q2 September 2014 results, Infosys had on 10 October 2014 retained its earlier guidance of 7% to 9% growth in revenue in dollar terms for FY 2015. At that time, the company had raised its revenue growth guidance in rupee terms due to rupee depreciation. The company had raised the revenue growth guidance for FY 2015 in rupee terms to 6.7%-8.7% from earlier 5.6%-7.6% at that time. The revised guidance was based on rupee dollar conversion rate of 61.
Shares of pharma firms advanced. Cadila Healthcare (up 2.96%), Wockhardt (up 3.06%), Cipla (up 2.31%), Torrent Pharmaceuticals (up 2.35%), Ipca Laboratories (up 2.25%), Dr Reddy's Laboratories (up 1.92%), Sun Pharmaceutical Industries (up 1.3%), Aurobindo Pharma (up 1.36%), Ranbaxy Laboratories (up 1.15%), Divi's Laboratories (up 1.17%), and Glenmark Pharmaceuticals (up 0.16%) edged higher.
Bharat Heavy Electricals (Bhel) was off 1.2% at Rs 254.50. The stock hit a high of Rs 261.20 and a low of Rs 254.55 so far during the day. The company during market hours today, 9 January 2015, said it has achieved another milestone by successfully commissioning one more 600 megawatts (MW) thermal unit in Chhattisgarh. The unit was commissioned at Jindal Power's upcoming 4x600 MW thermal power project located at Tamnar in Raigarh district of Chhattisgarh. This is the third 600 MW unit of the project commissioned by Bhel. The first two units of 600 MW each were commissioned in March 2014. Pesently, about 85 utility sets aggregating to more than 20,000 MW of private sector developers are in various stages of execution by Bhel.
Shares of Jindal Steel & Power (JSPL) were off 3.08% at Rs 152.60. Jindal Power is the power generation subsidiary of JSPL.
Shares of travel and tour operators and hospitality firms advanced after Minister of State for Tourism, Culture and Civil Aviation Dr. Mahesh Sharma said that India is poised to receive one percent of global tourists in three years. Among travel and tour operators, Cox & Kings (up 2.09%) and Thomas Cook (India) (up 1.31%) edged higher.
Among hospitality firms, EIH (up 1.79%), Hotel Leelaventure (up 0.72%), Indian Hotels Company (up 3.37%), and Royal Orchid Hotels (up 2.31%) edged higher.
Speaking at the Plenary session of the Pravasi Barati Diwas at Gandhinagar, Dr. Sharma yesterday, 8 January 2015, said that presently India receives about 7 million foreign tourists annually and the target is to get 1% share of the global tourist arrivals which is around 1.1 billion in three years. The minister said that tourism is one of the most important socio economic activities globally and it is very relevant for India's economy also. He said that the government has introduced Electronic Travel Authorisation (ETA) for 43 countries on 27 November 2014. The government has announced two more schemes for development of tourism infrastructure titled 'National Mission on Pilgrimage Rejuvenation and Spiritual Augmentation (PRASAD) and also another Rs 500 crore have been provided for development of 5 Integrated Circuits, the minister added.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 62.395, compared with its close of 62.68 during the previous trading session.
Brent crude futures edged higher amid speculation a slowdown in the US shale boom will reduce a glut that's driven prices to the lowest in 5-1/2-years. Brent for February settlement was up 34 cents at $51.30 a barrel. The contract had declined 19 cents to settle at $50.96 a barrel during the previous trading session.
Meanwhile, Finance Minister Arun Jaitley yesterday, 8 January 2015, said that domestic policies to achieve macro-economic balance and the on-going process of economic reforms would lend further strength to the recovery of the Indian economy. Jaitley made those comments during the Pre Budget Consultative Meeting with the representatives of Social Infrastructure, Human Capital and Development Groups. Jaitley said that emerging trends indicate the growth deceleration in India has bottomed-out. The Finance Minister said that significant downward trend in inflation has also been recorded in the second and third quarter of 2014-15. He said that external environment has also largely turned in India's favour.
On the macro front, data to be released in near future is expected to show industrial production growth remaining muted in November 2014 and consumer price inflation accelerating in December 2014. Industrial production is seen rising 1.6% in November 2014, as per the median estimate of a poll of economists carried out by Capital Market. The government will unveil industrial production data for November 2014 after trading hours on Monday, 12 January 2015. Industrial production had witnessed a surprise contraction of 4.2% in October 2014.
The rate of inflation based on the consumer price index (CPI) is seen accelerating to 5.4% in December 2014 from 4.4% in November 2014, as per the median estimate of a poll of economists carried out by Capital Market. The government will release the data on CPI inflation for December 2014 after trading hours on Monday, 12 January 2015.
The Reserve Bank of India (RBI) aims to limit consumer-price gains to 8% by January 2015 and 6% by January 2016. Over the longer term, the RBI aims to limit consumer-price gains to 4%, within a 2% band.
The rate of inflation based the wholesale price index (WPI) is projected at 0.5% for December 2014, as per the median estimate of a poll of economist carried out by Capital Market. WPI inflation stood at zero in November 2014. The government will release data on WPI for December 2014 at 12 noon on 14 January 2015.
Asian stocks edged higher today, 9 January 2015, taking cues from a surge on Wall Street amid hopes for continued improvement in the US economy. Key indices in China, Japan, Hong Kong, Singapore, South Korea, and Indonesia were up 0.12% to 2.99%. In Taiwan, the Taiwan Weighted index was off 0.24%.
China's consumer inflation remained tepid in December, while prices at the factory gate continued to slide. The consumer price index rose 1.5% on year in December, up slightly from a 1.4% on-year rise in November, data from the National Bureau of Statistics showed today, 9 January 2015.
Trading in US index futures indicated that the Dow could fall 13 points at the opening bell today, 9 January 2015. US stocks surged yesterday, 8 January 2015, as two days of steady oil prices along with dovish comments by a Federal Reserve member helped further fuel a buying frenzy which begun on Wednesday 7 January 2015. Prospects for further central-bank easing in Europe are also whetting investors' appetite for riskier assets, namely equities.
The number of people who applied for US unemployment benefits at the end of the year fell slightly and remained below the key 300,000 mark for the 16th time in 17 weeks, offering more proof the labor market is still on an upswing.
Federal Reserve Bank of Chicago President Charles Evans on Wednesday, 7 January 2015, said that the Fed's target inflation rate might not be hit until 2018, and he doesn't advise a rate hike until 2016. Evans, who is a voting member of the Federal Open Market Committee this year, was speaking at an event sponsored by the University of Chicago.
The US Labor Department reports monthly payroll data for December 2014 later in global day today, 9 January 2015.
In Europe, the uncertainties over the status of Greece including its possible exit from the eurozone are likely to persist until the early election in the country later this month. Greece is set to hold snap elections on 25 January 2015 after it failed to elect a new president in a third round of voting late last year. The Greek leftist opposition party Syriza leads opinion polls ahead of national elections on 25 January 2015. Syriza has demanded debt relief from the eurozone and promised to roll back the austerity and reform measures that the country has undertaken in exchange for the international bailout that the government negotiated in 2012.
Meanwhile, drop in euro-area consumer prices in December has fueled speculation the European Central Bank will bolster stimulus efforts.
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