After initial slide, key benchmark indices witnessed a sudden surge, with the 50-unit CNX Nifty regaining the psychological 8,000 mark. The barometer index, the S&P BSE Sensex, was currently up 205.17 points or 0.77% at 26,836.46. The market breadth indicating the overall health of the market was strong, with more than three gainers for every loser on BSE. The BSE Mid-Cap index was up 1.19%. The BSE Small-Cap index was up 1.95%. Both these indices outperformed the Sensex. The initial volatility for Indian stocks materialized after the US Federal Reserve at the end of a two-day policy meeting on Wednesday, 17 September 2014, maintained a commitment to keep US interest rates near zero for a "considerable time" after the bond-buying program ends even as its rate projections suggested some officials might have in mind a slightly more aggressive path of rate increases next year and in 2016 than previously thought.
L&T rose after the company said that its Buildings & Factories business of L&T Oman LLC, a subsidiary of L&T, has won a prestigious order from the Ministry of Defense, Sultanate of Oman against stiff international competition for the construction of Adam Air base.
Asian stocks gained in choppy trade after the US Federal Reserve after a two-day policy meet on Wednesday, 17 September 2014, renewed a pledge to keep interest rates near zero for a considerable time. Overnight, US markets closed slightly higher after the Fed statement and Fed Chairwoman Janet Yellen's news conference, with the Dow Jones Industrial Average reaching a record high.
In the foreign exchange market, the rupee fell below 61 against the dollar on dollar's broad strength after the Fed statement.
Brent crude oil prices extended overnight losses.
At 10:25 IST, the S&P BSE Sensex was up 205.17 points or 0.77% at 26,836.46. The index jumped 249.21 points at the day's high of 26,880.50 in morning trade, its highest level since 15 September 2014. The index dropped 128.21 points at the day's low of 26,503.08 in early trade.
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The CNX Nifty was up70.65 points or 0.89% at 8.046.15. The index hit a high of 8,051.15 in intraday trade, its highest level since 15 September 2014. The index hit a low of 7,939.70 in intraday trade.
The market breadth indicating the overall health of the market was strong, with more than three gainers for every loser on BSE. On BSE, 1,724 shares gained and 522 shares fell. A total of 63 shares were unchanged.
The BSE Mid-Cap index was up 115.52 points or 1.19% at 9,799.44. The BSE Small-Cap index was up 211.37 points or 1.95% at 11,041.21. Both these indices outperformed the Sensex.
L&T rose 1.34% after the company said that its Buildings & Factories business of L&T Oman LLC, a subsidiary of L&T, has won a prestigious order from the Ministry of Defense, Sultanate of Oman against stiff international competition for the construction of Adam Air base. The contract is for the construction of the Adam Airbase in Al Dakhiliya Governorate, Sultanate of Oman.
Reliance Communications gained 1.56%. With respect to the news flash "Rel Comm, ZTE sign agreement of $153 million, Rel Comm. Huawei sign agreement of $157 million" the company clarified during market hours that as a part of the routine and ongoing business requirement, the company has placed letter of intent with Huawei Communications for $157 million and ZTE Corporation for $162 million.
In the foreign exchange market, the rupee fell below 61 against the dollar on dollar's broad strength after the Fed statement. The partially convertible rupee was hovering at 61.115, compared with its close of 60.9175 during the previous trading session.
Brent crude oil prices dropped, pressured by a stronger dollar on fears about a looming US interest rate increase and a steep spike in US crude stocks. Brent for November settlement was down 64 cents at $98.33 a barrel. The contract had fallen 8 cents a barrel or 0.08% to settle at $98.97 a barrel on Wednesday, 17 September 2014.
Lower crude oil prices will help India in containing its fiscal deficit, current account deficit and fuel price inflation. India imports 80% of its crude oil requirement. However, a weak rupee will offset the benefit of falling crude oil prices to that extent.
Meanwhile, the President of the People's Republic of China, Mr. Xi Jinping and the First Lady Ms. Peng Liyuan arrived in Ahmedabad, Gujarat on Wednesday, 17 September 2014. Xi's three-day visit is aimed at ramping up trade and investments, besides having discussions on substantive issues including the contentious border dispute. India and China also signed three-Gujarat specific pacts on Wednesday. The three pacts include making Guangzhou city in China and Ahmedabad as sister cities, setting up of industrial parks in this state and an agreement between Guangdong province and the Gujarat government for development of cultural and social ties between the two countries.
Asian stocks rose today, 18 September 2014, after the US Federal Reserve renewed its pledge to keep interest rates near zero for a "considerable time". Key benchmark indices in China, Indonesia, Singapore, Taiwan and Japan were up 0.15% to 1.27%. Key benchmark indices in Hong Kong and South Korea were off 0.72% to 0.81%.
China's new-home prices fell in all but two cities monitored by the government last month as tight credit damped demand even as local home-purchase restrictions were eased. Prices dropped in 68 of the 70 cities in August from July, including in Beijing and Shanghai, the National Bureau of Statistics said in a statement today, the most since January 2011 when the government changed the way it compiles the data.
Trading in US index futures indicated that the Dow could gain 13 points at the opening bell on Thursday, 18 September 2014. US stocks edged higher in volatile trading on Wednesday, 17 September 2014, after the US Federal Reserve renewed its pledge to keep interest rates near zero for a "considerable time" and repeated concerns over slack in the labor market, standing firm against calls to overhaul its policy statement.
In a statement after a two-day meeting, it announced a further $10 billion reduction in its monthly purchases, leaving the program on course to be shuttered next month. While the Fed expects to keep rates low for a considerable time, Yellen in a news conference declined to say how much time that meant. She also repeatedly stressed the timing depends on how the economy performs.
While the Fed's policy statement emphasised rates would stay low for now, its rate projections suggested some officials might have in mind a slightly more aggressive path of rate increases next year and in 2016 than previously thought. In June, the median estimate among Fed officials for the Fed's target interest meaning half of estimates were above and half were below at the end of 2016 was 2.5%. The latest estimate for the end of 2016 was between 2.75% and 3%.
Meanwhile, the latest economic data showed that US consumer prices fell for the first time in nearly 1-1/2 years in August and underlying inflation pressures were muted, giving the Fed more ammunition in its argument to keep rates low.
In UK, a crucial vote on Scottish independence will be held today, 18 September 2014. Scotland is currently a part of United Kingdom.
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