After holding firm in mid-morning trade, key benchmark indices trimmed gains in early afternoon trade. The barometer index, the S&P BSE Sensex, was currently up 49.81 points or 0.19% at 26,364.10. Some progress was made on proposed goods and services tax (GST) after the empowered committee of state finance ministers on Wednesday, 20 August 2014, decided the common threshold for levy of GST. The market breadth indicating the overall health of the market was strong. Metal and mining stocks declined after a preliminary survey showed that manufacturing activity in China weakened in August to a three-month low. Axis Bank rose after the bank said its Board of Directors at a meeting held today, 21 August 2014, approved issuance of long term bonds/non-convertible debentures upto Rs 6000 crore on a private placement basis. Asian stocks were in red after a preliminary survey showed that manufacturing activity in China weakened in August to a three-month low. Brent crude dropped after yesterday's gains.
After witnessing a bout of initial volatility, key indices had surged in mid-morning trade.
At 12:16 IST, the S&P BSE Sensex was up 49.81 points or 0.19% at 26,364.10. The index jumped 150.51 points at the day's high of 26,464.80 in mid-morning trade. The index fell 12.03 points at the day's low of 26,302.26 in early trade.
The CNX Nifty was up 14.55 points or 0.18% to 7,889.85. The index hit a high of 7,919.65 in intraday trade. The index hit a low of 7,868.15 in intraday trade.
The market breadth indicating the overall health of the market was strong. On BSE, 1,599 shares gained and 987 shares fell. A total of 99 shares were unchanged.
The BSE Mid-Cap index was up 61.82 points or 0.67% at 9,338.16. The BSE Small-Cap index was up 77.66 points or 0.76% at 10,341.17. Both these indices outperformed the Sensex.
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Metal and mining stocks declined after a preliminary survey showed that manufacturing activity in China weakened in August to a three-month low. China is the world's largest consumer of steel, copper and aluminum. Bhushan Steel (down 5%), NMDC (down 0.71%), Steel Authority of India (down 1.27%), Tata Steel (down 1.07%), Sesa Sterlite (down 1.03%), JSW Steel (down 0.78%), Hindustan Zinc (down 0.41%), and Jindal Steel & Power (down 0.25%), edged lower. Hindalco Industries (up 0.22%), National Aluminum Company (up 1.4%) and Hindustan Copper (up 1.11%) gained.
Axis Bank rose after the bank said its Board of Directors at a meeting held today, 21 August 2014, approved issuance of long term bonds/non-convertible debentures upto Rs 6000 crore on a private placement basis. The stock was up 1.9%.
Titan Company jumped 5.1% after a foreign brokerage upgraded the stock to overweight from equal-weight. The foreign brokerage cited conviction in the strength of Titan Company's Tanishq jewellery brand and its potential to gain market share.
In the foreign exchange market, the rupee edged lower against the dollar after Federal Reserve minutes indicated that policy makers talked at their last meeting about a sooner-than-anticipated hike to US interest rates. The partially convertible rupee was hovering at 60.75, compared with its close of 60.62 on Wednesday, 20 August 2014.
The empowered committee of state finance ministers on Wednesday, 20 August 2014, reportedly decided that the common threshold for levy of goods and services tax (GST) would be kept at Rs 10 lakh in general category states and Rs 5 lakh in special category states. This means GST will be levied on all retailers and service providers with a turnover of more than Rs 10 lakh in general category states and Rs 5 lakh in special category states. The decision removes a key stumbling block in the finalisation of the GST structure and is expected to speed up the talks on implementation of the tax reform. However, significant differences still persist between the Centre and the states regarding GST, reports suggest. GST, a major indirect tax reform, will replace service tax, excise, state value-added tax and a number of other local levies.
Meanwhile, India's macroeconomic worries have eased on falling crude oil prices. India imports about 80% of its crude oil requirement. Brent dropped to below $102 a barrel as concerns over excess oil supply and slowing demand weighed on prices. The October Brent crude contract was down 29 cents at $101.99 a barrel. The contract gained 72 cents a barrel to settle at $102.28 a barrel yesterday, 20 August 2014. Brent had hit 14-month low of $101.07 a barrel early this week.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 251.36 crore on Wednesday, 20 August 2014, as per provisional data from the stock exchanges.
The Union Cabinet on Wednesday, 20 August 2014, at a meeting chaired by the Prime Minister, Narendra Modi gave its approval for Digital India - a programme to transform India into digital empowered society and knowledge economy. The programme will be implemented in phases from the current year till 2018. The Digital India is transformational in nature and would ensure that Government services are available to citizens electronically. It would also bring in public accountability through mandated delivery of government's services electronically, a Unique ID and e-Pramaan based on authentic and standard based interoperable and integrated government applications and data basis, a government statement said.
Asian shares fell today, 21 August 2014, as a disappointing survey on Chinese manufacturing stoked concerns about the regional giant. Key benchmark indices in Taiwan, Hong Kong, Indonesia, China, and South Korea were off 0.37% to 1.38%. Key benchmark indices in Japan and Singapore were up 0.07% to 0.85%.
The HSBC/Markit Flash China Manufacturing Purchasing Managers' Index (PMI) fell to 50.3 in August from July's 18-month high of 51.7, missing forecasts.
Trading in US index futures indicated that the Dow could fall 1 point at the opening bell on Thursday, 21 August 2014. Most US stocks closed higher on Wednesday, 20 August 2014, shaking off a dip that came after Federal Reserve minutes indicated that policy makers talked at their last meeting about a sooner-than-anticipated hike to interest rates.
The minutes from the two-day meeting of the Federal Open Market Committee in late July showed that Fed officials came closer to an agreement on how to exit from the most aggressive stimulus. At that meeting, the Fed trimmed its monthly bond-buying program by an additional $10 billion. The minutes showed that some participants were increasingly uncomfortable with the committee's forward guidance on keeping its benchmark rate low for a "considerable time,". Many participants said they might have to raise borrowing costs sooner than they had anticipated. The US central bank has kept its benchmark rate at almost zero since December 2008.
Federal Reserve Chairwoman Janet Yellen will give a speech tomorrow, 22 August 2014, at the annual Fed summit in Jackson Hole, Wyo. Fed Chair Janet Yellen is reportedly expected to acknowledge during the conference that while economic data has generally been supportive, she remains concerned about slack in the labor market.
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