Key benchmark indices surged as world stocks rose after the US Federal Reserve after a monetary policy review on Wednesday, 18 September 2013, decided to maintain stimulus to the US economy through monthly bond purchases of $85 billion. Fed's bond-buying program has been a source of liquidity for most Asian and emerging markets this year. The Fed decided against tapering its $85-billion-a-month in bond purchases for now, with Fed Chairman Ben Bernanke saying that economic data since June did not support a reduction in buys. The barometer index, the BSE Sensex, moved past the psychological 20,000 mark and the 50-unit CNX Nifty surged past the psychological 6,000 level. The Sensex hit its highest level in more than 34 months. The Nifty hit its highest level in more than 17 weeks. The Sensex was provisionally up 663.39 points or 3.32%, up close to 280 points from the day's low and off about 115 points from the day's high. The market breadth, indicating the overall health of the market, was positive. Except the BSE IT index, all the other sectoral indices on BSE were in the green.
The Sensex gained for the fourth straight day today, 19 September 2013.
Bank stocks galloped. Pharma stocks extended their recent gains. Index heavyweight and cigarette major ITC moved higher. Realty stocks jumped.
The market sentiment was boosted by data showing that foreign funds remained net buyers of Indian stocks on Wednesday, 18 September 2013. Foreign institutional investors (FIIs) bought shares worth net Rs 525.30 crore from the secondary equity markets on Wednesday, 18 September 2013, as per data from the Securities & Exchange Board of India (Sebi).
In the foreign exchange market, the rupee surged past 62 against the dollar as the Fed refrained from withdrawing monetary stimulus to the US economy. The partially convertible rupee was hovering at 61.86, sharply higher than its close of 63.38/39 on Wednesday, 18 September 2013.
Bond prices jumped as the Fed refrained from withdrawing monetary stimulus to the US economy. The yield on the benchmark federal paper 7.16% GS 2023 was hovering at 8.2089%, lower than its close of 8.3715% on Wednesday, 18 September 2013. Bond yield and bond prices are inversely related.
More From This Section
As per provisional figures, the S&P BSE Sensex was up 663.39 points or 3.32% to 20,625.55. The index surged 777.53 points at the day's high of 20,739.69 in late trade, its highest level since 11 November 2010. The index gained 385.14 points at the day's low of 20,347.30 in opening trade.
The CNX Nifty was up 208.40 points or 3.53% to 6,107.85, as per provisional figures. The index hit a high of 6,142.50 in intraday trade, its highest level since 22 May 2013. The index hit a low of 6,040.15 in intraday trade.
The total turnover on BSE amounted to Rs 4009 crore, sharply higher than Rs 1464.45 crore on Wednesday, 18 September 2013.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,430 shares rose and 997 shares fell. A total of 156 shares were unchanged.
Among the 30-share Sensex pack, 28 stocks rose and only two fell. Tata Steel (up 7.17%), Tata Power Company (up 6.36%) and L&T (up 6.25%), jumped.
Bank stocks galloped. State Bank of India jumped 8.32%. The state-run bank after market hours on Wednesday, 18 September 2013, said it has raised the base rate by 10 basis points (bps) to 9.8% per annum (pa) from 9.7% and the benchmark prime lending rate by 10 bps to 14.55% from 14.45% with effect from 19 September 2013. The bank has also raised interest rates for retail term deposits.
Among other PSU bank stocks, Canara Bank, Union Bank of India, Bank of India, Bank of Baroda and Punjab National Bank gained 8.63% to 11.21%.
Among private sector banks, ICICI Bank (up 6.36%), HDFC Bank (up 5.46%), and Axis Bank (up 5.91%), jumped.
Shares of private sector bank Yes Bank jumped a staggering 23.24%. The bank early this week said it has successfully closed equivalent to $255 million by way of dual currency, multi-tenor syndicated loan facility which will be utilized for general corporate purposes and trade finance. The facility has a maturity of 1 and 2 years with majority commitments coming in the 2 year tenure bucket. The loan has been widely distributed with commitments from 11 banks representing 8 countries across US, Europe, Middle East and Australia, Yes Bank said.
The recent RBI guidelines on offering swap facility to banks for the foreign currency borrowings at 100 basis points below the market rate will further make the landed rupee cost of these funds extremely competitive vis-vis rupee funds of equivalent maturity, Yes Bank said.
IndusInd Bank jumped 5.19% to Rs 434. A block deal of 3 lakh shares was executed in the counter on BSE at Rs 462.35 per share at 9:32 IST.
Realty stocks jumped. HDIL (up 4.69%), Unitech (up 7.29%), D B Realty (up 5.68%) and DLF (up 6.54%), jumped.
Index heavyweight and cigarette major ITC rose 3.49%, with the stock gaining for the third straight day. ITC's hospitality unit ITC Hotels on 16 September 2013, said it has tied up with RP Group Hotels & Resorts to manage 5 hotels in India and Dubai, under ITC Hotels' 5-star 'WelcomHotel' brand and the group's mid-market to upscale 'Fortune' brand. The tie-up has been firmed up through a Memorandum of Understanding between ITC Hotels and RP Groups Hotels & Resorts. While the two WelcomHotels are already under a management contract and will be flagged off immediately, the three Fortune hotels are a part of the signed MOU and will be launched subsequently, ITC Hotels said in a statement.
As part of its expansion drive, ITC Hotels proposes to add several managed hotels to its brand portfolio, it said. On the anvil are an ITC super-premium luxury hotel in Mahabalipuram, a WelcomHotel in Jodhpur, Patna and Chandigarh and more than 30 hotels under the Fortune brand.
Pharma stocks gained for the third straight day. Cipla rose 0.76%.
Dr Reddy's Laboratories rose 0.94%, with the stock extending recent gains triggered by the company getting USFDA nod for Azacitidine for injection 100 mg/vial, a bioequivalent generic version of VIDAZA (azacitidine for injection). The launch of product in the US market is planned in the near term, the company said during trading hours on Tuesday, 17 September 2013. The VIDAZA brand had US sales of approximately $378.5 million for the twelve months ended July 2013, according to IMS Health data.
Ranbaxy Laboratories gained 3.55% to Rs 346.10, with the stock gaining for the third day in a row. The company on Tuesday, 17 September 2013, said that during late hours on Monday, 16 September 2013, the company received communication from the US Food and Drug Administration (USFDA) that the regulator had imposed an import alert on the company's Mohali facility. The USFDA also advised that the Mohali facility will be subject to certain terms of the Consent Decree signed in January 2012. Ranbaxy said it will review the details and will continue to fully cooperate with the USFDA and take all necessary steps to resolve the concerns at the earliest.
The USFDA had conducted inspections at Ranbaxy's Mohali facility in 2012, resulting in certain observations. The company believes that it has made further improvements at its Mohali facility since the last inspection in 2012, and remains committed to adressing all concerns of the USFDA. Ranbaxy is hopeful of an early resolution these concerns, the company said in a statement.
Ranbaxy remains fully committed to upholding the highest standards that patients, prescribers, regulators and all other stakeholders expect from the company. Ranbaxy stays firmly committed to its philosophy of 'Quality and Patients First,' it said in a statement.
Shares of Ranbaxy had tumbled 30.27% in a single trading session to settle at Rs 318.85 on Monday, 16 September 2013, after the USFDA issued an import alert against company's Mohali plant.
Sun Pharmaceutical Industries gained 1.7%. The stock turned ex-dividend today, 19 September 2013, for dividend of Rs 2.50 per share for the year ended 31 March 2013.
Lupin rose 1.52%. The company on 16 September 2013 said it has received final approval for its Zolpidem Tartrate Extended release tablets USP, 6.25 mg and 12.5 mg from the United States Food and Drugs Administration (FDA) to market a generic version of Sanofi Aventis, U.S, LLC's (Sanofi) Ambien CR Extended release tablets, 6.25 mg and 12.5 mg. Lupin's wholly owned US subsidiary Lupin Pharmaceuticals Inc. (LPI) shall commence marketing the product shortly, the company said. Lupin's Zolpidem CR tablets 6.25 mg & 12.5 mg is the AB rated generic equivalent of Sanofi's Ambien CR Extended? release tablets, 6.25 mg and 12.5 mg and is indicated for the treatment of insomnia characterized by difficulties with sleep onset and/or sleep maintenance. Sanofi's Ambien CR Extended release tablets had annual US sales of approximately $366 million (IMS MAT Mar 2013).
Cadila Healthcare rose 2.03% to Rs 679.60. A block deal of 2 lakh shares was executed in the counter on BSE at Rs 670 per share at 13:45 IST.
Investors' focus will now shift to the outcome of the Reserve Bank of India's mid-quarter policy review tomorrow, 20 September 2013. At its mid-quarter monetary policy review tomorrow, 20 September 2013, the Reserve Bank of India will have to decide whether to give in to industry demands and lower interest rates in order to boost slowing economic growth, or leave interest rates unchanged for the third straight policy review as it guards against risks of a fresh rise in inflationary pressures. The RBI will release Mid-Quarter Review of Monetary Policy 2013-14 at 11:00 IST tomorrow, 20 September 2013. This will be followed by Governor Raghuram Rajan addressing the media in the afternoon on that day.
European stocks surged on Thursday, 19 September 2013, after the US Federal Reserve decided not to taper its asset purchases as many analysts had expected. Key benchmark indices in UK, France and Germany were up 1.03% to 1.4%.
Asian stocks jumped on Thursday, 19 September 2013, after the Federal Reserve unexpectedly refrained from reducing US economic stimulus on Wednesday, 18 September 2013. Key benchmark indices in Hong Kong, Indonesia, Japan and Singapore rose by 1.67% to 4.65%. The stock markets in Mainland China, Taiwan and South Korea were closed for a holiday.
Japan's exports rose the most since 2010 in August, boosting Prime Minister Shinzo Abe's growth drive. Japanese exports rose 14.7% on year in August, the Ministry of Finance said Thursday.
Trading in US index futures indicated that the Dow could gain 54 points at the opening bell on Thursday, 19 September 2013. US stocks climbed to record highs on Wednesday and the benchmark 10-year Treasury yield fell sharply after the Federal Reserve abstained from reducing its bond buys. The Federal Open Market Committee after two-day policy meet on Wednesday said it wants more evidence of an economic recovery before paring its $85 billion-a-month bond buying program. Fed Chairman Ben S. Bernanke said there is no fixed schedule for tapering and it could still start this year should data confirm the central bank's basic outlook.
In fresh quarterly projections, the Fed cut its forecast for 2013 economic growth to a 2% to 2.3% range from a June estimate of 2.3% to 2.6%. The downgrade for next year was even sharper. It cited strains in the economy from tight fiscal policy and higher mortgage rates as it explained why it decided to maintain asset purchases at the current pace. The tightening of financial conditions observed in recent months, if sustained, could slow the pace of improvement in the economy and labor market, it said in a statement. Nevertheless, the Fed said the economy was still making progress despite tax hikes and budget cuts in Washington. Taking into account the extent of federal fiscal retrenchment, the committee sees the improvement in economic activity and labor market conditions since it began its asset purchase program a year ago as consistent with growing underlying strength in the broader economy, it said.
Meanwhile, the US Commerce Department reported that housing starts rose 0.9% to a smaller-than-expected 891,000 annual pace in August.
Powered by Capital Market - Live News