Key benchmark indices edged higher as the rupee nudged higher against the dollar after data released by the Reserve Bank of India (RBI) on Monday, 30 September 2013, showed a lower-than-expected current account deficit in Q1 June 2013. Gains in Asian and European stocks aided upmove on the domestic bourses. The barometer index, the BSE Sensex, was provisionally up 147.64 points or 0.76%, off about 5 points from the day's high and up close to 260 points from the day's low. The market breadth, indicating the overall health of the market, was positive. Bond prices rose after the Reserve Bank of India (RBI) on Monday, 30 September 2013, said will infuse Rs 10000 crore into the banking system through open-market operations next week to ease liquidity constraints.
Indian stocks snapped two-day losing streak today, 1 October 2013.
Capital goods pivotals and bank stocks gained on renewed buying. Realty stocks also edged higher on renewed buying. JSW Steel rose after the company announced its plan to set up a second steel processing center in Pune (Maharashtra) with its JV partner Marubeni Itochu Steel Inc. Tokyo, (MISI).
A bout of volatility was witnessed in early trade as key benchmark indices slipped into the red after a firm opening triggered by higher Asian stocks. Key benchmark indices regained positive terrain in morning trade. The barometer index, the BSE Sensex, and the 50-unit CNX Nifty, both, reversed direction after hitting 3-1/2-week low. Intraday volatility continued as key benchmark indices recovered after trimming almost entire intraday gains in mid-morning trade. The Sensex extended intraday gains and hit fresh intraday high in early afternoon trade. Key benchmark indices traded off the day's high in afternoon trade. The Sensex extended gains and hit fresh intraday high in mid-afternoon trade. The Sensex further extended gains and hit fresh intraday high in late trade.
The stock market remains closed tomorrow, 2 October 2013, on account of Mahatma Gandhi Jayanti.
As per provisional figures, the S&P BSE Sensex was up 147.64 points or 0.76% to 19,527.41. The index jumped 153.14 points at the day's high of 19,532.91 in late trade. The index declined 115.05 points at the day's low of 19,264.72 in morning trade, its lowest level since 6 September 2013.
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The CNX Nifty was up 50 points or 0.87% to 5,785.30, as per provisional figures. The index hit a high of 5,786.45 in intraday trade. The index hit a low of 5,700.95 in intraday trade, its lowest level since 6 September 2013.
The total turnover on BSE amounted to Rs 1485 crore, lower than Rs 1785.71 crore on Monday, 30 September 2013.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,322 shares rose and 1,006 shares fell. A total of 156 shares were unchanged.
Among the 30-share Sensex pack, 16 stocks rose and rest of them fell. HDFC (up 2.79%), Bajaj Auto (up 2.34%), and Maruti Suzuki India (up 1.8%), edged higher from the Sensex pack.
Asian Paints declined 0.83%. The company said during market hours that Asian Paints (International) (APIL), Mauritius -- a wholly owned subsidiary of the Company -- currently owns about 90.44% of the total number of issued shares of Berger International, Singapore together with the valid acceptances received in terms of its delisting offer for Berger International, Singapore. On 21 August 2013, Asian Paints had informed about the acquisition of additional shares and voluntary unconditional cash offer for the remaining shares of Berger International (BIL), Singapore by APIL, Mauritius. Further APIL had also announced its intention to acquire the balance 24.18% shares of BIL with an intention to make BIL a wholly owned subsidiary of APIL and delist from the Singapore Exchange Securities Trading (SGX-ST).
The closing date for the offer is 9 October 2013 at 5.30 pm (Singapore time) or such later date(s) as may be announced from time to time by APIL. The announcement has already been made on the Singapore Exchange by BIL. BIL has no operations in India.
Capital goods pivotals gained on renewed buying. Bhel (up 2.8%) and L&T (up 1.7%), rose.
Bank stocks rose on renewed buying. Among private bank stocks, HDFC Bank (up 2.92%), Yes Bank (up 2.77%), Axis Bank (up 3.84%) and ICICI Bank (up 3.29%), gained.
Kotak Mahindra Bank rose 1.56%. The bank said after market hours on Monday, 30 September 2013, that the bank has decided not to transfer any SLR security from AFS/HFT to HTM as permitted under Reserve Bank of India (RBI) circular though there is sufficient headroom to do so. Reserve Bank of India, vide its circular dated 23 August 2013 had, as a onetime measure, permitted banks to transfer SLR securities from AFS/HFT to HTM category during the current year up to the limit of 24.50% of net demand and time liabilities (NDTL). To mitigate impact of mark to market losses incurred by banks due to abnormal market conditions, the RBI also gave banks the option of valuing these securities for the purpose of such transfer, as at the close of business of 15 July 2013. Such transfers were to be done no later than 30 September 2013.
State Bank of India (SBI) rose 1.78%. The bank last week said that it has repurchased a principal amount of $147 million of $1 billion 3.25% bonds due 2018 (the 2018 Bonds). The 2018 Bonds were issued by SBI on 18 April 2013 and are listed on the Singapore Exchange Securities Trading. The repurchase of the Bond took place between 26 August 2013 and 26 September 2013. The bank is in the process of cancelling the repurchased 2018 Bonds and the aggregate outstanding principal amount of the 2018 Bonds following such cancellation will be $853 million, SBI said in a statement.
Punjab National Bank advanced 0.05%. The bank said after market hours on Monday, 30 September 2013 that the bank has decided to provide interest at uniform rate of 9% on all NRE term deposits of tenure 3 years and above up to 10 years, considering recent relaxations permitted by the Reserve Bank of India (RBI). These changes shall be effective from 1 October 2013.
Bank of Baroda rose 1.3%. The bank has decided to revise the rates of interest payable on term deposits of below Rs 1 crore and Rs 1 crore and above of some maturities with effect from 1 October 2013.
Bank of India jumped 5.45%. Canara Bank rose 2.78%.
JSW Steel rose 3.25% after the company during market hours announced its plan to set up a second steel processing center in India's automobile hub Pune (Maharashtra) with its JV partner Marubeni Itochu Steel Inc. Tokyo, (MISI). The 1st Phase of the project is expected to come on stream by FY 2014 with an installed capacity of 1.8 lakh tonnes per annum and will be scaled upto 3.6 lakh tonnes per annum in Phase 2. The project will be set up at a capital cost of Rs 204 crore and will be funded through 50% equity and 50% debt element.
Seshagiri Rao, Joint Managing Director, JSW Steel & Group Chief Financial Officer, said: "The rapid growth of the Indian steel industry offers tremendous opportunity for supply of high end processed steel. We can leverage the global sales network of expertise of Service Center Operations of MISI and the World Class Technology Products manufactured by JSW.
The joint venture company is equipped to process flat steel products such as hot rolled, cold rolled and coated products with a view to offer just in time solutions to the automotive, white goods, construction and other value added segments.
In 2011, JSW Steel and Marubeni Itochu Steel Inc. formed a JV to set-up a Steel Processing center near Palval (Haryana), under the name of "JSW MI Steel Service Center". JSW Steel & MISI both have a history of cooperation in areas of mutual interest which will further strengthen going forward.
Zee Entertainment gained 1.34% to Rs 231.45. A block deal of 2.5 lakh shares was executed in the counter on BSE at Rs 230.50 per share at 12:14 IST.
Realty stocks edged higher on renewed buying. DLF (up 6.58%), Sobha Developers (up 2.38%), HDIL (up 0.42%), and Unitech (up 0.64%), gained.
India received 6% higher rainfall than normal in the 2013 monsoon season ended on September 30, the Indian Meteorological Department (IMD) said on Tuesday, strengthening prospects of a bumper farm output that could boost farmers' earnings. Monsoon rains are vital for 55% of the country's farmlands that lack irrigation facilities, and can make the difference between India being an exporter or importer of staples such as rice and sugar.
Factory activity in India shrank for a second month in September, albeit not as sharply as in August, on a dearth of new orders which pushed firms to cut staff, a survey showed on Tuesday. The HSBC Manufacturing PMI, compiled by Markit, rose to 49.6 in September from 48.5 in August, but remaining below the watershed 50 mark that separates growth from contraction. The new orders sub-index rose to 49.6 last month from 47.5 in August.
In the foreign exchange market, the rupee edged higher against the dollar, with the Indian currency finding support from data showing a lower-than-expected current account deficit in Q1 June 2013. The partially convertible rupee was hovering at 62.39, compared with its close of 62.60/61 on Monday, 30 September 2013.
India's current account deficit (CAD) widened to $21.8 billion or 4.9% of GDP in Q1 June 2013 from $16.9 billion or 4% of GDP in Q1 June 2012, data released by the Reserve Bank of India (RBI) after trading hours on Monday, 30 September 2013, showed. The CAD was $18.1 billion in Q4 March 2013. The RBI said that the year-on-year rise in CAD in Q1 June 2013 was due to a rise in imports and some decline in merchandise exports. Merchandise trade deficit (balance of payments basis) widened to $50.5 billion in Q1 June 2013 from $43.8 billion in Q1 June 2012. The trade deficit, coupled with a slow recovery in net invisibles (income and services), led to widening of CAD on year-on-year basis in Q1 June 2013, the RBI said. On balance of payments (BoP) basis, there was a slight drawdown in foreign exchange reserves of $0.3 billion in Q1 June 2013 as against an accretion of $0.5 billion in Q1 June 2012.
Bond prices rose after the Reserve Bank of India (RBI) on Monday, 30 September 2013, said will infuse Rs 10000 crore into the banking system through open-market operations next week to ease liquidity constraints. The yield on the federal benchmark paper 7.16% GS 2023 was hovering at 8.7248%, lower than its close of 8.7658% on Monday, 30 September 2013. Bond yield and bond prices are inversely related.
Based on the current assessment of prevailing and evolving market conditions, the RBI will purchase government securities for an aggregate amount of Rs 10000 crore on 7 October 2013, the RBI said in a press release on Monday, 30 September 2013.
The government's fiscal deficit for the April-August period has reached about three-fourths of its target for the year ending March, data released after trading hours on Monday, 30 September 2013, showed. By the end of August, the gap between the government's revenue and expenses has reached 74.6% of its target for the fiscal year, according to data released on Monday. Expenses during the first five months were about 40% of the aim for the year, while revenue was way short at 23% of the target. The government aims to limit the deficit within 4.8% of gross domestic product, compared with 4.9% last year.
The combined output of the eight core infrastructure sectors rose 3.7% in August 2013, supported by strong growth in coal and cement production and electricity generation, data released by the government after trading hours on Monday, 30 September 2013, showed. It was the highest growth in core sector output in seven months.
European stocks were mostly higher on Tuesday, 1 October 2013, with data showing the euro-zone manufacturing sector expanded for a third month in September. The final manufacturing purchasing managers' index came in at 51.1, unchanged from a preliminary reading. Key benchmark indices in France and Germany were up 0.58% to 0.7%. However, UK's FTSE 100 was down 0.23%.
Euro-area unemployment unexpectedly retreated from a record, as the currency bloc's economic recovery gained momentum. The jobless rate fell to a revised 12 percent in July from a record 12.1 percent a month earlier, and held at that level in August, the European Union's statistics office in Luxembourg said today.
Asian stocks rose on Tuesday, 1 October 2013, as a report showed confidence among large Japanese manufacturers increased. Key benchmark indices in Japan, South Korea, Taiwan, Indonesia, and Singapore rose 0.10% to 0.69%. China's local markets are shut from today, 1 September 2013 till 7 October 2013 for National Day holidays.
A Chinese factory gauge rose less than economists forecast in September, signaling limits on the nation's rebound from a two-quarter economic slowdown. The Purchasing Managers' Index was at 51.1, the National Bureau of Statistics and China Federation of Logistics and Purchasing said today in Beijing. That compares with 51 in August.
The Bank of Japan's quarterly Tankan index for big manufacturers rose to 12 in September, the highest since 2007, from 4 in June.
The Reserve Bank of Australia kept official interest rates at a record low 2.5% for the second month in a row on Tuesday, saying that the impact of its earlier cuts were still filtering through the economy.
Trading in US index futures indicated that the Dow could gain 58 points at the opening bell on Tuesday, 1 October 2013. US stocks closed lower on Monday with just hours to go before a midnight deadline to avert a federal government shutdown.
The US government began a partial shutdown on Tuesday for the first time in 17 years after lawmakers could not break a political stalemate that sparked new questions about the ability of a deeply divided Congress to perform its most basic functions. Some US government offices and national parks will be shuttered, but spending for essential functions related to national security and public safety will continue, including pay for US military troops.
There are also fears that the conflict could spill over into the more crucial dispute over raising the federal government's borrowing authority. A failure to raise the $16.7 trillion debt ceiling would force the country to default on its obligations, dealing a potentially painful blow to the economy and sending shockwaves around global markets.
The Federal Open Market Committee (FOMC) holds a two-day policy meeting on 29-30 October 2013. On 18 September 2013, the Fed surprised economists and investors with its decision to delay scaling back its stimulus amid concerns about the strength of the economic recovery.
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