With global markets awaiting the outcome of a crucial monetary policy review from the European Central Bank (ECB) later in the global day, key equity benchmark indices in India trimmed intraday gains in mid-afternoon trade. The market breadth indicating the overall health of the market was negative. The barometer index, the S&P BSE Sensex, was hovering below the psychological 29,000 mark. The Sensex was currently up 29.27 points or 0.10% at 28,918.13. The BSE Mid-Cap index slipped into the red from green.
Power generation stocks were mixed. Shares of private sector banks were mixed. Shares of public sector banks dropped.
Earlier, the Sensex and the 50-unit CNX Nifty had, both, hit record high in mid-morning trade as these two key benchmark indices extended their initial gains. The Sensex moved past the psychological 29,000 level for the first time in its history.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 2065.49 crore yesterday, 21 January 2015, as per provisional data.
In overseas markets, European shares edged lower on caution ahead of the outcome of a monetary policy review from the European Central Bank (ECB) later in the global day. Asian shares edged higher after China's central bank injected 50 billion yuan ($8 billion) of liquidity into the financial system. US stocks eked out small gains yesterday, 21 January 2015, on speculation the European Central Bank (ECB) will unveil a government-bond-buying program aimed at spurring Europe's ailing economy.
Canada's central bank, the Bank of Canada, delivered a shock interest-rate cut after a monetary policy review yesterday, 21 January 2015, becoming the first Group of Seven country to slash rates in response to the oil-price collapse and its impact on economic growth.
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In the foreign exchange market, the rupee edged lower against the dollar on speculation the Reserve Bank of India intervened to stem the currency's advance.
Brent crude futures edged slightly lower as traders braced for the outcome of the European Central Bank meeting.
At 14:15 IST, the S&P BSE Sensex was up 29.27 points or 0.1% at 28,918.13. The index jumped 171.55 points at the day's high of 29,060.41 in mid-morning trade, a lifetime high for the index. The index rose 13.57 points at the day's low of 28,902.43 in mid-afternoon trade.
The CNX Nifty was up 5.55 points or 0.06% at 8,735.05. The index hit a high of 8,772.70 in intraday trade, a lifetime high for the index. The index hit a low of 8,728.50 in intraday trade.
The BSE Mid-Cap index was off 13.25 points or 0.12% at 10,688.99, underperforming the Sensex. The BSE Small-Cap index was up 20.41 points or 0.18% at 11,443.29, outperforming the Sensex.
The market breadth indicating the overall health of the market was negative. On BSE, 1,540 shares declined and 1,257 shares gained. A total of 113 shares were unchanged.
Power generation stocks were mixed. GMR Infrastructure (up 2.09%), NHPC (up 2.09%), Jaiprakash Power Ventures (up 0.59%), Adani Power (up 0.22%), JSW Energy (up 0.09%) and Reliance Power (up 0.08%), edged higher. Tata Power Company (down 0.06%), Torrent Power (down 0.21%), CESC (down 1.02%), Reliance Infrastructure (down 1.2%) and NTPC (down 2.16%) edged lower.
Minister for Power and Coal Piyush Goyal reportedly said on the sidelines of the World Economic Forum (WEF) meeting yesterday, 21 January 2015, that the country's power sector is set for $250 billion investment across different segments. Investments are expected across diverse areas of the energy sector including in renewables as well as transmission and distribution segments, Goyal reportedly said.
Shares of private sector banks were mixed. City Union Bank (down 1.68%), Yes Bank (down 0.75%), Federal Bank (down 0.35%), edged lower. HDFC Bank (up 0.14%), ICICI Bank (up 0.14%), IndusInd Bank (up 0.62%) and Axis Bank (up 2.4%), edged higher.
Kotak Mahindra Bank was off 0.3%.
ING Vysya Bank was up 0.24% to Rs 980.55. The stock hit high of Rs 982.80 and low of Rs 955.85 so far during the trading session. The private sector bank's net profit fell 12.93% to Rs 145.69 crore on 13.8% increase in total income to Rs 1693.30 crore in Q3 December 2014 over Q3 December 2013. The result was announced after market hours yesterday, 21 January 2015. Provisions and contingencies jumped 167.31% to Rs 61.51 crore in Q3 December 2014 over Q3 December 2013. Provisions and contingencies rose 23.86% to Rs 61.51 crore in Q3 December 2014 over Q2 September 2014.
On absolute basis, the bank's gross non-performing assets (NPAs) before technical write off edged up to Rs 764.01 crore as on 31 December 2014, from Rs 635.84 crore as on 30 September 2014 and Rs 582.69 crore as on 31 December 2013. The ratio of gross NPA to gross advances edged up to 1.86% as on 31 December 2014, from 1.59% as on 30 September 2014 and 1.68% as on 31 December 2013. The ratio of net NPA to net advances edged up to 0.66% as on 31 December 2014, from 0.42% as on 30 September 2014 and 0.21% as on 31 December 2013.
Kotak Mahindra Bank and ING Vysya Bank have announced amalgamation of ING Vysya with Kotak in the ratio of 725 shares of Kotak for every 1,000 shares of ING Vysya.
Shares of public sector banks dropped. Indian Bank (down 2.22%), Punjab and Sind Bank (down 1.93%), UCO Bank (down 1.52%), Syndicate Bank (down 1.47%), Andhra Bank (down 1.44%), Allahabad Bank (down 1.42%), Canara Bank (down 1.28%), Punjab National Bank (down 1.16%), Bank of India (down 1.13%), United Bank of India (down 1.07%), Bank of Maharashtra (down 1.03%), IDBI Bank (down 0.85%), State Bank of India (down 0.84%), Dena Bank (down 0.59%), Central Bank (down 0.39%) and Union Bank of India (down 0.16%), edged lower.
Bank of Baroda fell 1.14% to Rs 223. The stock turned ex-split today, 22 January 2015, for 5-for-1 stock split.
Corporation Bank declined 3.27% to Rs 75.10. The stock turned ex-split today, 22 January 2015, for 5-for-1 stock split.
NMDC fell 0.83% on reports that the government has sought expression of interest from reputed merchant bankers for divesting 10% stake in the state-run iron ore miner.
In the foreign exchange market, the rupee edged lower against the dollar on speculation the Reserve Bank of India intervened to stem the currency's advance. The partially convertible rupee was hovering at 61.68, compared with its close of 61.635 during the previous trading session.
Brent crude futures edged slightly lower as traders braced for the outcome of the European Central Bank meeting. Brent for March settlement was off 25 cents at $48.78 a barrel. The contract had risen $1.04 a barrel or 2.17% to settle at $49.03 a barrel during the previous trading session.
In his foreword to the fourth edition of the annual Status Paper on Government Debt which gives detailed analysis of the government's debt position released yesterday, 21 January 2015, Finance Minister Arun Jaitely has said that the overall liabilities of the Central Government are on a medium-term declining trajectory with low roll-over risk, notwithstanding the slight increase in a couple of years in recent past due to stimulus spending in the wake of the global financial crisis. The share of public account liabilities in the total liabilities of the General Government are also on a declining trend. The average interest cost, which is stable and well below nominal GDP growth rate, indicates that India is comfortably placed in terms of sustainability parameters of public debt, Jaitley said. The government's debt portfolio is characterized by prudent risk profile with share of short-term debt within safe limits. Most of the debt is of domestic origin insulating the debt portfolio from currency risk. The limited external debt is almost entirely from official sources on concessional terms, providing safety from volatility in the international financial markets. The relatively long maturity of debt and its predominantly fixed-coupon character point to low roll-over and interest rate risks, Jaitley said.
This paper reiterates the government's commitment to keep the level of public debt within sustainable limits, the finance ministry said at the time of releasing the fourth edition of the annual Status Paper on Government Debt yesterday, 21 January 2015.
US President Barack Obama arrives on a visit to India this weekend. The US President is the Chief Guest for India's Republic Day celebrations in New Delhi on 26 January 2015.
European shares edged lower today, 22 January 2015, on caution ahead of the outcome of a monetary policy review from the European Central Bank (ECB) later in the global day. Key benchmark indices in France and Germany were off 0.01% to 0.04%. In UK, the FTSE 100 was up 0.23%.
The governing council of the European Central Bank (ECB) is scheduled to undertake monetary policy review today, 22 January 2015. The ECB may announce a large-scale bond-buying program today, 22 January 2015, aimed at spurring Europe's ailing economy. According to media reports, the ECB may announce a proposal for a quantitative-easing program of euro 50 billion ($58 billion) a month aimed at stimulating growth.
Meanwhile, uncertainties over the status of Greece including its possible exit from the eurozone are likely to persist until the early election in the country on 25 January 2015. 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.
Asian shares edged higher today, 22 January 2015, after China's central bank injected 50 billion yuan ($8 billion) of liquidity into the financial system. Key benchmark indices in China, Hong Kong, Japan, Indonesia, Singapore and Taiwan were up by 0.28% to 0.70%. South Korea's Seoul Composite was off 0.02%.
China's central bank today, 22 January 2015, injected cash into the money markets using short-term instruments it hasn't used in a year, spurring speculation that further loosening of monetary policy may be on the way as the economy grows at its slowest rate in more than two decades. The People's Bank of China offered 50 billion yuan ($8 billion) of seven-day reverse repos, a short-term lending facility to commercial banks, in its open-market operation today, 22 January 2015. The move to keep the banks flush with cash comes ahead of the Lunar New Year holiday next month when demand for funds normally increases substantially as people spend on gifts and dining.
The injection of funds into the country's money markets came after the central bank yesterday, 21 January 2015, said that it rolled over three-month loans of 269.5 billion yuan ($43.5 billion) and offered 50 billion yuan of medium-term loans to designated commercial banks.
Trading in US index futures indicated that the Dow could rise 56 points at the opening bell today, 22 January 2015. The US stock market ended Wednesday's choppy trading day with modest gains, extending its winning streak to three sessions, as investors widely expect the European Central Bank to deliver on monetary stimulus at its key meeting today, 22 January 2015.
In Canada, the nation's central bank, the Bank of Canada, delivered a shock interest-rate cut after a monetary policy review yesterday, 21 January 2015, becoming the first Group of Seven country to slash rates in response to the oil-price collapse and its impact on economic growth. The Bank of Canada, which had been widely expected to hold rates steady before raising them later in the year or in early 2016, cut its benchmark overnight rate by a quarter percentage point to 0.75%the first cut to the rate since April 2009, when the economy was mired in recession. Sliding oil prices, which the central bank said it expects will recover to around $60 in the medium term, will erode growth and inflation for Canada, it said in a statement announcing the interest-rate cut. It lowered its growth forecast for the first half of 2015 to 1.5%, and to 2.1% for the full year from 2.4%.
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