A rebound in global stocks aided recovery on the domestic bourses after the carnage witnessed yesterday, 24 August 2015. The barometer index, the S&P BSE Sensex, garnered 290.82 points or 1.13% to settle at 26,032.38. The gains for the Sensex in percentage terms were higher than those for the 50-unit CNX Nifty. The Nifty rose 71.70 points or 0.92% to settle at 7,880.70. The Sensex reclaimed the psychological 26,000 level. The index fell below the psychological 26,000 level yesterday, 24 August 2015, as Indian stocks crashed as part of a global rout in equities sparked by worries that China's economy is slowing down more than anticipated.
The market breadth indicating the overall health of the market was negative. The BSE Mid-Cap index rose 1.99%, outperforming the Sensex. The BSE Small-Cap index rose 1.01%.
Oil, metal and banking stocks led recovery for key benchmark indices. Shares of oil exploration & production (E&P) firms edged higher as global crude oil prices rose. Shares of most pharmaceutical firms edged higher. Auto stocks edged higher on renewed buying. Most IT stocks declined
Key indices today, 25 August 2015, snapped three-day losing streak.
Meanwhile, Parliamentary Affairs Minister Venkaiah Naidu reportedly said today, 25 August 2015, that the government is considering reconvening Parliament to get the Parliament's nod for the Goods and Service Tax bill.
There was massive selling of Indian stocks by foreign portfolio investors (FPIs) yesterday, 24 August 2015, when carnage was witnessed on the domestic bourses as part of a global rout in equities sparked by worries that China's economy is slowing down more than anticipated. FPIs sold shares worth a net Rs 5163.47 crore into secondary equity market yesterday, 24 August 2015, as per data from National Securities Depository (NSDL). Domestic institutional investors (DIIs) bought shares worth a net Rs 4097.83 crore yesterday, 24 August 2015, as per provisional data released by the stock exchanges.
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Indian stocks may remain volatile in the near future as traders roll over positions in the futures & options (F&O) segment from the near month August 2015 series to September 2015 series. The near month August 2015 derivatives contracts are set to expire on Thursday, 27 August 2015.
The S&P BSE Sensex rose 290.82 points or 1.13% to settle at 26,032.38, its highest closing level since 21 August 2015. The index jumped 383.27 points at the day's high of 26,124.83 at the onset of trading session. The index fell 443.14 points at the day's low of 25,298.42 in early afternoon trade, its lowest level since 8 August 2014.
The Nifty rose 71.70 points or 0.92% to settle at 7,880.70, its highest closing level since 21 August 2015. The index hit a high of 7,925.40 in intraday trade. The index hit a low of 7,667.25 in intraday trade, its lowest level since 12 August 2014.
The BSE Mid-Cap index rose 205.58 points or 1.99% to settle at 10,560.32, outperforming the Sensex. The BSE Small-Cap index rose 106.77 points or 1.01% to settle at 10,694.67, underperforming the Sensex.
The market breadth indicating the overall health of the market was negative. On BSE, 1,506 shares fell and 1,214 shares rose. A total of 108 shares were unchanged.
The total turnover on BSE amounted to Rs 4793 crore, higher than turnover of Rs 4386.38 crore registered during the previous trading session.
Among the sectoral indices on BSE, the S&P BSE Healthcare index (up 1.15%), BSE Auto index (up 2.06%), BSE Bankex index (up 2.52%), BSE Metal index (up 4.04%), BSE Oil & Gas index (up 3.73%) and BSE Realty index (up 6.78%) outperformed the Sensex. The S&P BSE FMCG index (up 0.75%), BSE IT index (down 0.48%),BSE Power index (up 0.9%), BSE Capital Goods index (up 0.4%), BSE Consumer Durables index (up 0.53%) and BSE Teck index (up 0.03%) underperformed the Sensex.
Shares of most pharmaceutical firms edged higher. Glenmark Pharmaceutical Industries (up 5.64%), Lupin (up 1.49%), Dr Reddy's Laboratories (up 2.34%), Cipla (up 2.02%), Wockhardt (up 1.73%) and Sun Pharmaceutical Industries (up 0.1%) edged higher. Strides Arcolab (down 2.75%), Divi's Laboratories (down 1.99%), GlaxoSmithkline Pharmaceuticals (down 1.63%) and Ipca Laboratories (down 1.21%) edged lower.
Auto stocks edged higher on renewed buying. TVS Motor Company (up 4.8%), Tata Motors (up 6.3%), Ashok Leyland (up 2.25%), Mahindra & Mahindra (up 1.96%), Eicher Motors (up 1.23%) and Bajaj Auto (up 0.74%) edged higher. Maruti Suzuki India (down 1.2%) and Hero MotoCorp (down 0.06%) edged lower.
Banks shares edged higher. Among PSU banks, State Bank of India (up 3.22%), Canara Bank (up 1.64%), Union Bank of India (up 1.59%), Punjab National Bank (up 1.51%), Andhra Bank (up 0.85%), Bank of India (up 0.43%), Syndicate Bank (up 0.23%) and Bank of Baroda (up 0.19%) edged higher. IDBI Bank (down 1.57%), Oriental Bank of Commerce (down 1.69%) and Central Bank of India (down 9.74%) edged lower.
Among private sector banks, ICICI Bank (up 5.06%), Axis Bank (up 4.18%), IndusInd Bank (up 1.98%) and HDFC Bank (up 0.28%) edged higher. Kotak Mahindra Bank (down 1.15%) edged lower.
Yes Bank surged 8.08% at Rs 679.95. The bank announced during trading hours today, 25 August 2015, that it has received approval from the Reserve Bank of India for re-appointment of Rana Kapoor as Managing Director and Chief Executive Officer for a period of three years with effect from 1 September 2015.
Most metal shares edged higher. Vedanta (up 7.73%), Hindustan Zinc (up 4.24%), JSW Steel (up 3.93%), Tata Steel (up 3.88%), Jindal Steel & Power (up 2.15%), Hindalco Industries (up 2.09%), Steel Authority of India (up 1.59%) and NMDC (up 0.16%) edged higher. National Aluminium Company (down 0.68%) edged lower.
Shares of oil exploration & production (E&P) firms edged higher as global crude oil prices rose. Reliance Industries (up 2.89%), Cairn India (up 2.81%), Oil India (up 2.65%) and ONGC (up 1.52%) edged higher. Higher crude oil prices will result in increase in realization from crude sales for oil exploration firms.
In the global commodities markets, Brent crude oil futures recovered from a sharp slide during the previous session. Brent for October settlement was currently up $1.14 a barrel at $43.83 a barrel. The contract had fallen $2.77 a barrel or 6.09% to settle at $42.69 a barrel during the previous trading session.
Shares of public sector oil marketing companies (PSU OMCs) also edged higher. BPCL (up 5.62%) and HPCL (up 6.62%) edged higher.
Indian Oil Corporation rose 4.36% at Rs 394.75. The finance ministry yesterday, 24 August 2015, announced that despite adverse market conditions, the Offer for Sale (OFS) for divestment of Government of India's 10% stake in Indian Oil Corporation (IOCL) through the stock exchanges mechanism was oversubscribed. The institutional investors' portion was subscribed 143% and the retail investors' portion was subscribed 18%. With total subscription of approximately Rs 11107 crore, the OFS was oversubscribed by 18%. The OFS was completed in a single trading session yesterday, 24 August 2015.
With this disinvestment, the Government of India's take in IOCL will come down to 58.57%.
Larsen & Toubro (L&T) fell 0.48% at Rs 1,625.60. The stock hit a high of Rs 1,666 and a low of Rs 1,575 in intraday trade. The company announced during trading hours today, 25 August 2015, that its Power Transmission & Distribution Business unit won orders worth Rs 1563 crore in both the international and domestic markets in July and August 2015.
Most IT stocks declined. MindTree (down 4.04%), HCL Technologies (down 1.36%), Infosys (down 0.56%), TCS (down 0.46%) and Wipro (down 0.4%) edged lower. Oracle Financial Services Software (up 1.21%) edged higher.
Tech Mahindra rose 0.96% at Rs 528.40. The stock hit a high of Rs 542.70 and a low of Rs 493.30 in intraday trade. The company after market hours yesterday, 24 August 2015, announced that its in-house developed platform TAP (Tech Mahindra Analytics Platform) for Big Data solutions has been certified by Hortonworks, a technology leader and ecosystem builder for the Apache Hadoop industry. TAP, an asset-based delivery kit, addresses the critical and evolving needs of customers with a multitude of diverse use cases in Big Data Analytics. It is one of the major technology initiatives in the Analytics area and the certification by Hortonworks adds further value to this asset and enables the delivery of analytics solutions on the HWX platform, Tech Mahindra said in a statement.
Key indices snapped three-day losing streak today, 25 August 2015. The Sensex lost 1,624.51 points or 5.94% in a single trading session to settle at 25,741.56 yesterday, 24 August 2015, amid a rout in global markets triggered by concerns that growth in the once highflying Chinese economy may be slowing dramatically. The Sensex declined 2,190.08 points or 7.84% in the preceding three trading sessions to settle at 25,741.56 yesterday, 24 August 2015, from a recent high of 27,931.64 on 19 August 2015. The Sensex has declined 2,082.18 points or 7.4% in this month so far (till 25 August 2015). The Sensex has fallen 1,467.04 points or 5.33% in this calendar year so far (till 25 August 2015). The Sensex is off 3,992.36 points or 13.29% from a record high of 30,024.74 hit on 4 March 2015.
Meanwhile, Parliamentary Affairs Minister Venkaiah Naidu reportedly said today, 25 August 2015, that the government is considering reconvening Parliament to get the Parliament's nod for the Goods and Service Tax (GST) bill. The government failed to get the GST bill passed during the recently concluded monsoon session of parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country.
Meanwhile, Finance Minister Arun Jaitley yesterday, 24 August 2015, said that though the Indian economy is not impervious to global events, yet the growth in manufacturing and services sector, as reflected by the increase in indirect tax collections and a fair monsoon indicate that the economy is showing strong revival and growth.
India's weather office, the India Meteorological Department (IMD), said in a daily report issued yesterday, 24 August 2015, that for the country as a whole, cumulative rainfall during this year's monsoon season was 11% below the Long Period Average (LPA) until 24 August 2015. Region wise, the rainfall was 19% below the LPA in South Peninsula, 14% below the LPA in Central India, 6% below the LPA in East & Northeast India and 4% below the LPA in Northwest India until 24 August 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 markets, European stocks edged higher today, 25 August 2015, with bargain hunters wading back into the market after it suffered its worst selloff in nearly seven years. Key benchmark indices in Germany, UK and France were up 3.21% to 4.23%.
Data released by the Destatis in Germany showed the economy continued to improve in the second quarter despite the Greek crisis. The gross domestic product (GDP) increased by 0.4% (after price, seasonal and calendar adjustment) in the second quarter of 2015 compared with the first quarter.
Earlier during the global day, Chinese stocks sank for the second trading session in a row. In mainland China, the Shanghai Composite lost 7.63%. In Hong Kong, the Hang Seng index shed 0.72%. The People's Bank of China injected more cash into the country's financial system today, 25 August 2015, as part of a routine money market operation. The Shanghai Composite index had plunged more than 8% in a single trading session yesterday, 24 August 2015, that sent shockwaves through global financial markets.
Meanwhile, China's central bank People's Bank of China (PBOC) today, 25 August 2015, lowered its one-year lending rate by 25 basis points (bps) to 4.6% effective 26 August 2015. It also cut deposit rate by 25 bps to 1.75% effective from Wednesday, 26 August 2015 and cut banks' reserve requirement ratio by 50 bps effective 6 September 2015. The PBOC also removed its control over fixed bank deposits with more than one-year maturity. The announcement came after trading ended in Asian markets.
Japanese stocks also witnessed a sharp slide. The Nikkei 225 Average lost 3.96%.
But other Asian markets edged higher. Key benchmark indices in Indonesia, Singapore, South Korea and Taiwan gained 0.92% to 3.58%.
Trading in US index futures indicated that the Dow could jump 535.50 points at the opening bell today, 25 August 2015. US stocks slid again yesterday, 24 August 2015, with the Dow Jones industrial average briefly plunging more than 1,000 points in a sell-off that sent a shiver of fear through investors. The Dow finished with a loss of 588 points, the eighth-worst single-day point decline and the second straight fall of more than 500.
Atlanta Fed President Dennis Lockhart yesterday, 24 August 2015, said that the Federal Reserve is likely to begin raising rates sometime this year.
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