Market seen opening higher

Market will react to the government's approval of proposals to increase FDI limits in 12 sectors including defence and telecom announced after market hours on Tuesday, 16 July 2013. Trading of CNX Nifty futures on the Singapore stock exchange indicates that the Nifty could gain 12.50 points at the opening bell. HDFC Bank will be watched ahead of its Q1 results today, 17 July 2013. Asian shares were trading mixed on Wednesday.

Telecom stocks may advance after the Congress-led United Progressive Alliance (UPA) has, with a few caveats, allowed 100% foreign direct investment (FDI) in telecom. FDI in the telecom services sector was increased from 74% to 100%, but all investments above 49% will continue to be routed through FIPB.

JSW Steel after trading hours on Tuesday, 16 July 2013, said that as a policy the company does not respond to speculative stories and market rumours after media reports said that JSW Steel is in talks to purchase a significant stake in Sandur Manganese and Iron Ores to improve its access to iron ore and cut logistics costs. Earlier, Sandur Manganese during trading hours on Tuesday, 16 July 2013, had denied stake sale reports. Neither Sandur Manganese nor its promoters have appointed any investment bankers to scout for a buyer, Sandur Manganese had said.

Torrent Pharmaceuticals after trading hours on Tuesday, 16 July 2013, said it has fixed 24 July 2013 record date for 1:1 bonus share issue.

UltraTech Cement turns ex-dividend today, 17 July 2013, for dividend of Rs 9 per share for the year ended 31 March 2013 (FY 2013).

Berger Paints India turns ex-dividend today, 17 July 2013, for dividend of Rs 1.80 per share for the year ended 31 March 2013 (FY 2013).

Shriram City Union Finance turns ex-dividend today, 17 July 2013, for final dividend of Rs 6 per share for the year ended 31 March 2013 (FY 2013).

Tata Communications turns ex-dividend today, 17 July 2013, for dividend of Rs 3 per share for the year ended 31 March 2013 (FY 2013).

The government after trading hours on Tuesday, 16 July 2013 announced approval of proposals to increase FDI limits in 12 sectors as proposed by the Arvind Mayaram commitee, including crucial ones such as defence and telecom. FDI can come in through the automatic route or after approval by the Foreign Investment Promotion Board (FIPB). Key benchmark indices snapped three-day winning streak on Wednesday, 17 July 2013 after the Reserve Bank of India (RBI) after trading hours on Monday, 15 July 2013 announced liquidity tightening measures to prevent a sharp depreciation of the rupee against the dollar. The S&P BSE Sensex lost 183.25 points or 0.91% to settle at 19,851.23, its lowest closing level since 11 July 2013.

Foreign institutional investors (FIIs) sold shares worth a net Rs 357.40 crore on Tuesday, 16 July 2013, as per provisional data from the stock exchanges.

The Reserve Bank of India (RBI) after market hours on Monday, 15 July 2013, announced a slew of measures to address exchange rate volatility. RBI raised the Marginal Standing Facility (MSF) rate and Bank Rate each by 200 bps to 10.25% while capped the amount up to which banks can borrow or lend under its daily liquidity window at Rs 75000 crore. Furthermore, RBI will additionally sell Rs 12000-crore of government bonds on Thursday, 18 July 2013, to mop up liquidity from the system, it said.

The RBI said it will continue to closely monitor the markets, the liquidity situation and the macroeconomic developments and will take such other measures as may be necessary, consistent with the growth-inflation dynamics and macroeconomic stability.

Finance Minister P. Chidambaram on Tuesday, 16 July 2013, said RBI's steps to curb rupee liquidity are aimed at quelling excessive speculation and volatility in the forex market and should not be read as a prelude to policy rate changes.

Asian shares were trading mixed on Wednesday on expectations Federal Reserve Chairman Ben Bernanke will reiterate later in the day that U.S. monetary policy is to stay accommodative. Key benchmark indices in Japan, Taiwan and Singapore were down 0.14% to 0.56%. Key benchmark indices in Hong Kong, South Korea and Indonesia were up 0.64% to 0.76%. China's Shanghai Composite was up unchanged.

US stocks declined on Tuesday, with the S&P 500 breaking an eight-session winning streak after a Federal Reserve member urged reduced stimulus and Coca-Cola Co.'s profit fell.

Federal Reserve Chairman Ben Bernanke kicks off his two-day testimony on monetary policy in Washington today, 17 July 2013. The minutes of the Fed's June meeting released on 10 July 2013 showed that while several members judged that a reduction in asset purchases would likely soon be warranted, many want to see further improvement in the labor market before reducing the central bank's $85 billion-a-month quantitative easing program. The Fed currently buys $85 billion a month in government and mortgage bonds in an effort to keep interest rates low and stimulate economic growth. At a press conference following the June 18-19 meeting, Bernanke said the central bank could start reducing its $85 billion in monthly bond purchases later this year if the economy continues to improve in line with its forecasts.

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