Key benchmark indices pared losses in afternoon trade. The 50-unit CNX Nifty pared losses after hitting fresh intraday low. The market breadth, indicating the overall health of the market, turned positive from negative. The barometer index, the S&P BSE Sensex, was down 97.91 points or 0.43%, up about 45 points from the day's low and off close to 122 points from the day's high. Weakness in global stocks hit sentiment on the domestic bourses adversely.
Sugar stocks were in demand. Ingersoll-Rand (India) rose after good Q4 results. Clariant Chemicals (India) fell weak Q1 results. Voltamp Transformers declined after weak Q4 results.
The market edged lower amid initial volatility. Key benchmark indices trimmed losses after hitting fresh intraday low in morning trade. The Sensex extended losses and hit fresh intraday low in mid-morning trade. The Sensex further extended losses and hit fresh intraday low in early afternoon trade. Key benchmark indices pared losses in afternoon trade. The 50-unit CNX Nifty pared losses after hitting fresh intraday low.
Foreign institutional investors (FIIs) bought shares worth a net Rs 45.93 crore on Tuesday, 6 May 2014, as per provisional data from the stock exchanges.
At 13:15 IST, the S&P BSE Sensex was down 97.91 points or 0.43% to 22,410.51. The index fell 143.06 points at the day's low of 22,365.36 in early afternoon trade, its lowest level since 5 May 2014. The index rose 24.40 points at the day's high of 22,532.82 in early trade.
The CNX Nifty was down 32.45 points or 0.48% to 6,682.85. The index hit a low of 6,672.25 in intraday trade, its lowest level since 30 April 2014. The index hit a high of 6,718.75 in intraday trade.
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The BSE Mid-Cap index was up 27.09 points or 0.37% at 7,397.78. The BSE Small-Cap index was up 16.13 points or 0.21% at 7,548.96. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market turned positive from negative in afternoon trade. On BSE, 1246 shares rose and 1221 shares fell. A total of 140 shares were unchanged.
Among the 30-share Sensex pack, 16 stocks declined and rest of them rose. Infosys (down 2.9%), Wipro (down 2.4%), Bharti Airtel (down 2.38%), HDFC (down 1.94%), TCS (down 1.34%), Bajaj Auto (down 1.12%), Tata Power (down 0.9%), Maruti Suzuki India (down 0.8%), Hindalco Industries (down 0.76%) and ICICI Bank (down 0.75%), edged lower from the Sensex pack.
NTPC (up 2.02%), Sun Pharmaceutical Industries (up 1.56%), State Bank of India (up 1%), Bhel (up 0.81%), Axis Bank (up 0.80%), ONGC (up 0.59%), Tata Motors (up 0.38%), Sesa Sterlite (up 0.28%), Coal India (up 0.27%) and Hindustan Unilever (up 0.23%), edged higher from the Sensex pack.
Sugar shares were in demand. Empee Sugars (up 4.86%), Dhampur Sugar (up 3.53%), Sakthi Sugars (up 3.48%), Balrampur Chini Mills (up 3.16%), EID Parry (up 2.2%), Bajaj Hindusthan (up 2.33%), KCP Sugar & Industries Corporation (up 2.53%), Dwarikesh Sugar Industries (up 0.76%), Triveni Engineering & Industries (up 0.57%) and Shree Renuka Sugars (up 0.46%), edged higher.
Ingersoll-Rand (India) rose 1% after net profit rose 16.99% to Rs 21.41 crore on 0.47% decline in net total income from operations to Rs 133.05 crore in Q4 March 2014 over Q4 March 2013. The company announced results during trading hours today, 7 May 2014.
Clariant Chemicals (India) fell 2.73% after net profit fell 38.9% to Rs 15.13 crore on 1.2% decline in net sales to Rs 274.21 crore in Q1 March 2014 over Q1 March 2013. The Q1 result was announced after market hours on Tuesday, 6 May 2014.
Voltamp Transformers fell 1.36% after net profit fell 36.2% to Rs 9.52 crore on 17.4% decline in net sales to Rs 144.49 crore in Q4 March 2014 over Q4 March 2013. The Q4 result was announced after market hours on Tuesday, 6 May 2014.
In the foreign exchange market, the rupee edged higher against the dollar on speculation Federal Reserve Chair Janet Yellen will reiterate a pledge to keep US interest rates low in testimony later in the global day today, 7 May 2014. The partially convertible rupee was hovering at 60.045, compared with its close of 60.11/12 on Tuesday, 6 May 2014.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014, as consumer-price inflation eased to a two-year low and as the rupee firmed up against the dollar.
A major near term trigger for the stock market is the outcome of the ongoing Lok Sabha elections. The 36 days long voting process began on 7 April 2014 and will conclude on 12 May 2014. The results will be declared on 16 May 2014 after which India will get a new government. The term of the current Lok Sabha expires on 1 June and the new House has to be constituted by 31 May.
Investors are hoping that a stable government which will complete its full term of office i.e. five years comes to power after the elections. Investors are expecting measures for revival of the Indian economy, business-friendly policies and better governance from new government that comes to power after the elections. Investors expect policy measures from the new government to put India on a high-growth path on a sustainable basis.
European markets were trading lower in early trade on Wednesday, as Ukraine appears even closer to an all-out war. Key benchmark indices in UK, France and Germany were down by 0.37% to 0.45%.
A monthly meeting of the Monetary Policy Committee of the Bank of England's (BoE) for monetary policy review is scheduled tomorrow, 8 May 2014.
The European Central Bank (ECB) will hold monetary policy meeting tomorrow, 8 May 2014, in Brussels, Belgium.
German factory orders unexpectedly fell in March, signaling that growth in Europe's largest economy remains uneven. Orders, adjusted for seasonal swings and inflation, fell 2.8% from February, when they increased a revised 0.9%, the Federal Statistics Office in Wiesbaden said today.
Asian shares fell on Wednesday, 7 May 2014, amid mounting concern China's economy is slowing after the result of a survey released by HSBC Holdings Plc and Markit Economics showed that services index for China declined in April from March. Key benchmark indices in Japan, Hong Kong, China, Singapore, South Korea and Taiwan were down 0.22% to 2.93%. Indonesia's Jakarta Composite rose 0.39%.
A services index in China from HSBC Holdings Plc and Markit Economics dropped to 51.4 in April from 51.9 in the previous month.
Most members of the Bank of Japan agreed to keep easing monetary policy until inflation stabilizes at 2%, according to minutes of the April 7-8 policy meeting released today, 7 May 2014.
Trading in US index futures indicated that the Dow could slide 19 points at the opening bell on Wednesday, 7 May 2014. US stocks dropped broadly on Tuesday, 6 May 2014, closing at session lows, with AIG pulling financial shares lower after disappointing earnings and as a slide in Twitter took down other names in the technology and internet space.
The US trade deficit narrowed in March as exports grew by the most in nine months, the Commerce Department reported yesterday, 6 May 2014.
US Federal Reserve Chairwoman Janet Yellen is scheduled to testify before the congressional Joint Economic Committee today, 7 May 2014, and the Senate Budget Committee tomorrow, 8 May 2014.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 17-18 June 2014. The Fed on 30 April 2014 said after a monetary policy review that it will keep the benchmark interest-rate target at almost zero for a "considerable time" after its bond-buying program ends. The FOMC also reduced monthly debt purchases to $45 billion, its fourth straight $10 billion cut, and said further reductions are likely in "measured steps" if the economy continues to improve.
The global economy will strengthen over the coming two years, but urgent action is still required to further reduce unemployment and address other legacies from the crisis, according to the OECD's latest Economic Outlook.
"Advanced economies are gaining momentum and driving the pick-up in global growth, while once-stalled cylinders of the economic engine, like investment and trade, are starting to fire again," OECD Secretary-General Angel Gurr said while launching the Outlook during the Organisation's annual Ministerial Council Meeting and Forum in Paris.
GDP growth across the 34-member OECD is projected to accelerate to a 2.2% rate in 2014 and 2.8% in 2015, according to the Outlook. The world economy will grow at a 3.4% rate in 2014 and 3.9% in 2015.
Among the major advanced economies, recovery is best established in the United States, which is projected to grow by 2.6% in 2014 and 3.5% in 2015. The euro area will see a return of positive growth after three years of contraction: 1.2% in 2014 and 1.7% in 2015. In Japan, growth will be dented by the launch of much-needed fiscal consolidation measures, and is expected to hover at 1.2% in 2014 and 2015.
The BRICS (Brazil, China, India, Indonesia, Russia and South Africa) are projected to see GDP growth of 5.3% this year on average and 5.7% in 2015. China will again have the fastest growth among these countries, with rates just below 7.5% in 2014 and 2015.
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