Amid growing risk aversion in global financial markets, key equity benchmark in India extended losses in early afternoon trade. The market breadth indicating the overall health of the market was turned negative from positive. The barometer index, the S&P BSE Sensex, was currently off 94.38 points or 0.34% at 27,425.73. The BSE Small-Cap and Mid-Cap indices, both, slipped into the red from green. Asian stocks dropped as a sharp slide in copper prices in global markets sparked concerns about slowing global growth. Trading in US index futures indicated a weak opening of US stocks later in the global day today, 14 January 2015.
Capital goods stocks rose. IT stocks were mixed, Yes Bank gained in volatile trade after reporting strong Q3 results.
The World Bank yesterday, 13 January 2015, lowered its global growth forecast for 2015 and next year due to disappointing economic prospects in the euro zone, Japan and some major emerging economies that offset the benefit of lower oil prices.
Foreign portfolio investors bought shares worth a net Rs 235.09 crore yesterday, 13 January 2015, as per provisional data.
Meanwhile, Finance Minister Arun Jaitley yesterday, 13 January 2015, said that the government is committed to fiscal discipline and with sharp decline in international oil prices and due to focused attention from the government, the Current Account Deficit (CAD) is also within the comfort level.
In overseas markets, Asian stocks fell as a sharp slide in copper prices in global markets sparked concerns about slowing global growth. US stocks registered small losses yesterday, 13 January 2015, in what was a highly volatile trading session.
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In the foreign exchange market, the rupee edged lower against the dollar in volatile trade on global risk off sentiment.
Global crude prices extended losses from the lowest closing level in more than five and half years as the United Arab Emirates and Kuwait predicted a global supply glut will persist to at least the second half of 2015. 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. However, a weakness in rupee against the dollar will restrict the benefit of falling global crude oil prices to that extent. A weak rupee raises the cost of imports.
At 12:18 IST, the S&P BSE Sensex was down 94.38 points or 0.34% at 27,425.73. The index declined 111.47 points at the day's low of 27,314.26 in early afternoon trade, its lowest level since 9 January 2015. The index rose 87.07 points at the day's high of 27,512.80 in early trade.
The CNX Nifty was down 24.05 points or 0.29% at 8,275.35. The index hit a low of 8,271.15 in intraday trade. The index hit a high of 8,326.45 in intraday trade.
The BSE Mid-Cap index was down 7.18 points or 0.07% at 10,485.59. The BSE Small-Cap index was down 13.63 points or 0.12% at 11,237.88. The decline in both these indices was lower than the Sensex's decline in percentage terms.
The market breadth indicating the overall health of the market was turned negative from positive in early afternoon trade. On BSE, 1,338 shares declined and 1,185 shares rose. A total of 104 shares were unchanged.
Capital goods stocks rose. ABB (India) (up 0.55%), L&T (up 0.08%), %), BEML (up 1.45%), Bharat Heavy Electricals (Bhel) (up 2.39%), Crompton Greaves (up 0.43%) and Siemens (up 1.22%) gained.
IT stocks were mixed. Infosys (up 1.28%), Tech Mahindra (up 1.04%), and TCS (up 0.81%) gained. HCL Technologies (down 0.07%) and Wipro (down 0.39%) declined.
Yes Bank gained 0.26% to Rs 784.05 on strong Q3 results. The stock hit high of Rs 793.55 and low of Rs 779.30 so far during the day. Yes Bank's net profit rose 30% to Rs 540.29 crore on 20.89% rise in total income to Rs 3508.47 crore in Q3 December 2014 over Q3 December 2013. The result hit the market during trading hours today, 14 January 2015. Net interest income (NII) increased 36.6% to Rs 909 crore in Q3 December 2014 over Q3 December 2013, led by steady growth in advances, coupled with expansion in net interest margin (NIMs) to 3.2% in Q3 December 2014 from 2.9% in Q3 December 2013. Non-interest income increased 38.4% to Rs 536.8 crore in Q3 December 2014 over Q3 December 2013.
On absolute basis, gross non-performing assets (NPAs) edged up to Rs 278.70 crore as on 31 December 2014, from Rs 222.4 crore as on 30 September 2014 and Rs 195.8 crore as on 31 December 2013. The ratio of gross NPA to gross advances edged up to 0.42% as on 31 December 2014, from 0.36% as on 30 September 2014, and 0.39% as on 31 December 2013. The ratio of net NPAs to net advances edged up to 0.1% as on 31 December 2014, from 0.09% as on 30 September 2014, and 0.08% as on 31 December 2013.
The bank's specific loan loss provision coverage stood at 76.8% as on 31 December 2014. Total restructured advances (excluding NPAs) stood at Rs 170.70 crore as on 31 December 2014. This represents 0.26% of the gross advances against 0.21% as on 31 December 2013.
Current and Savings Account (CASA) deposits grew by 30.7% year on year (y-o-y) to Rs 18622.6 crore taking the CASA ratio to 22.6% as on 31 December 2014, up from 20.9% as on 31 December 2013. Continued investment in retail branches and retail sales force has resulted in achieving consistent CASA growth, Yes Bank said in a statement. Yes Bank's total advances grew by 32.4% to Rs 66606.9 crore as on 31 December 2014. The bank's CD ratio stood at 80.9% as on 31 December 2014. The cost effective longer tenor FCY borrowing resulted in lower deposit growth, Yes Bank said.
In the foreign exchange market, the rupee edged lower against the dollar in volatile trade on global risk off sentiment. The partially convertible rupee was hovering at 62.1825, compared with its close of 62.15 during the previous trading session.
Brent crude oil futures extended losses from the lowest closing level in more than five and half years as the United Arab Emirates and Kuwait predicted a global supply glut will persist to at least the second half of 2015. Brent for February settlement was off 58 cents at $46.01 a barrel. The contract had lost 84 cents or 1.77% to settle at $46.59 a barrel during the previous trading session. Brent for March settlement was off 86 cents at $47.24 a barrel.
On macro front, data released during trading hours today, 14 January 2015, showed that inflation based on the wholesale price index (WPI) stood at 0.11% in December 2014, as compared to zero in November 2014. Build up inflation rate in the financial year so was a negative 0.28%, compared to a build up rate of 5.58% in the corresponding period of the previous year. Meanwhile, WPI for October 2014 was revised downwards to 1.66%, from 1.77% reported earlier.
Meanwhile, Finance Minister Arun Jaitley yesterday, 13 January 2015, said that the government is committed to fiscal discipline and with sharp decline in international oil prices and due to focused attention from the government, the Current Account Deficit (CAD) is also within the comfort level. Jaitely made these comments during the Pre Budget Consultative Meeting with the economists. The Finance Minister said that the government has taken lot of initiatives in different sectors in the last 7-8 months with an objective to take the economy on a higher growth path. Jaitley said that the government is committed to regain the investors' confidence for investment in infrastructure and revival of manufacturing sector among others.
Asian stocks edged lower today, 14 January 2015, as commodity prices slumped. Key benchmark indices in China, Indonesia, Singapore, Taiwan, Japan, Hong Kong and South Korea were off 0.05% to 1.71%.
Trading in US index futures indicated that the Dow could fall 137 points at the opening bell today, 14 January 2015. US stocks registered small losses yesterday, 13 January 2015, in what was a highly volatile trading session. Earlier, US stocks had surged in early trade, underpinned by better-than-expected earnings from the industrial bellwether Alcoa and hopes that European Central Bank (ECB) is close to providing quantitative easing.
Meanwhile in Europe, 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.
The World Bank yesterday, 13 January 2015, lowered its global growth forecast for 2015 and next year due to disappointing economic prospects in the euro zone, Japan and some major emerging economies that offset the benefit of lower oil prices. The global development lender predicted the global economy would grow 3% this year, below a forecast of 3.4% made in June, according to its twice-yearly Global Economic Prospects report. World GDP growth will reach 3.3% in 2016, as opposed to a June forecast of 3.5%, before dipping to 3.2% in 2017, it said.
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