Key benchmark indices reversed intraday losses in late trade after comments from Finance Minister Arun Jaitley that there is no cause to panic about the possibility of higher inflation. A decline in crude oil prices also aided recovery on the domestic bourses as the 50-unit CNX Nifty hit record high. The market breadth indicating the overall health of the market once again tuned positive from negative in late trade. The barometer index, the S&P BSE Sensex, was provisionally up 146.27 points or 0.57%, up close to 310 points from the day's low and off about 10 points from the day's high. The market sentiment was upbeat after provisional data showed that foreign investors remained net buyers of Indian stocks on Thursday, 3 July 2014. Indian stocks are witnessing a pre-Budget rally amid expectations that Jaitley will announce measures aimed at bolstering economic growth.
Shares of State Bank of India's subsidiary banks surged. Index heavyweight Reliance Industries (RIL) rose. Realty stocks edged higher. Shares of public sector oil marketing companies (PSU OMCs) rose on reports that the oil ministry has recommended a hike in kerosene and LPG prices.
As per provisional figures, the S&P BSE Sensex was up 146.27 points or 0.57% to 25,970.02. The index surged 157.76 points at the day's high of 25,981.51 in late trade. The index fell 164.42 points at the day's low of 25,659.33 in afternoon trade, its lowest level since 1 July 2014.
The CNX Nifty was up 38.85 points or 0.5% to 7,753.65, as per provisional figures. The index hit a high of 7,758 in intraday trade, a lifetime high for the index. The index hit a low of 7,661.30 in intraday trade, its lowest level since 1 July 2014.
The total turnover on BSE amounted to Rs 3843 crore, much higher than Rs 1429.99 crore on Thursday, 3 July 2014. The turnover was hit on Thursday, 3 July 2014, due to a 3-hour shutdown on BSE caused by network outage.
The market breadth indicating the overall health of the market once again turned positive from negative in late trade. On BSE, 1,668 shares rose and 1,373 shares fell. A total of 124 shares were unchanged. Earlier, the breadth had turned negative from positive in early afternoon trade.
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The BSE Mid-Cap index was up 55.17 points or 0.58% at 9,545.75. The BSE Small-Cap index was up 88.65 points or 0.85% at 10,508.03. Both these indices outperformed the Sensex.
Among the 30-share Sensex pack, 19 stocks rose and rest of them fell.
Shares of State Bank of India's subsidiary banks surged. State Bank of Mysore (up 3.56% to Rs 592.10), State Bank of Travancore (up 3.63% to Rs 818.80) and State Bank of Bikaner & Jaipur (up 10.67% to Rs 617.05) gained.
State Bank of India (SBI) rose 0.22% to Rs 2,698.
Index heavyweight Reliance Industries (RIL) rose 2.61% to Rs 1,033.40. The stock hit high of Rs 1,036.80 and low of Rs 1,004.15.
ONGC rose 0.54% to Rs 420.45.
Shares of public sector oil marketing companies (PSU OMCs) rose on reports that the oil ministry has recommended a hike in kerosene and LPG prices. HPCL (up 1.8% to Rs 421.55) and Indian Oil Corporation (IOCL) (up 1.94% to Rs 349.20) gained. BPCL fell 0.22% to Rs 598. As per reports, the oil ministry is likely to recommend raising kerosene price by Rs 4-5 per litre and LPG by Rs 250 per cylinder to the Cabinet committee, according to the recommendations of Kirit Parikh panel. However, last month the government had said that it has no plans to hike LPG and kerosene prices.
PSU OMCs suffer under recoveries on domestic sale of diesel, LPG and kerosene at controlled prices. The government has already freed pricing of petrol.
Realty stocks edged higher. DLF (up 1.11% to Rs 218.30), Sobha Developers (up 1.89% to Rs 490), Housing Development & Infrastructure (HDIL) (up 0.29% to Rs 103) and Unitech (up 0.3% to Rs 32.90) gained.
There are expectations that the government will take steps towards providing the long awaited industry status to the real estate sector and provide boost to low cost housing in the final Union Budget 2014-15 to be unveiled on 10 July 2014. There are also expectations that the tax benefit with respect to interest payment on housing loans will be raised. At present, a maximum deduction of Rs 1.5 lakh is allowed on taxable income towards interest on housing loan
The Sensex regained positive terrain after slipping into the red for a brief period after opening higher. Key benchmark indices hovered in positive terrain in morning trade. Key benchmark indices pared gains after hitting fresh intraday high in mid-morning trade. Key benchmark indices witnessed a sudden slide in early afternoon trade. Key benchmark indices cut losses in afternoon trade. Key benchmark indices further pared intraday losses in mid-afternoon trade. Key benchmark indices reversed intraday losses in late trade after comments from Finance Minister Arun Jaitley that there is no cause to panic about the possibility of higher inflation. A decline in crude oil prices also aided recovery on the domestic bourses as the 50-unit CNX Nifty scaled record..
Concerns about India's macroeconomic situation have eased as crude prices have come off 9-month high which it hit last month. India imports about 80% of its crude oil requirement. Brent crude oil futures for August delivery were off 5 cent at $110.95 a barrel. The contract fell 24 cents to settle at $111 a barrel on Thursday, 3 July 2014, on prospects of increase in oil exports from Libya.
All eyes are now on the final Union Budget for 2014-15 due next week. Jaitley will present the Budget in Lok Sabha at 11:00 IST on Thursday, 10 July 2014. After a clear mandate in Lok Sabha elections this year and with BJP perceived as a business friendly party, expectations from the Budget are running high. There are expectations that the finance minster will announce measures in the Budget aimed at bolstering economic growth. Increase in outlay on infrastructure sector with focus on stricter and time-bound implementation of projects, initiatives towards investments in agriculture and irrigation aimed at easing supply bottlenecks for food-grains, fiscal prudence with roadmap to reduce the fiscal deficit, a roadmap for reducing the subsidy burden and timeline for implementation of the Goods and Service Tax are some of the expectations from the Budget.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 59.76, compared with its close of 59.73/74 on Thursday, 3 July 2014.
European stocks edged lower on Friday, 4 July 2014, as German factory orders fell more than expected in May. Key benchmark indices in UK, France and Germany were off 0.06% to 0.11%.
German factory orders fell more than expected in May as geopolitical risks weighed on confidence in the strength of Europe's largest economy. Orders, adjusted for seasonal swings and inflation, fell 1.7% from April, when they rose a revised 3.4%, the Economy Ministry in Berlin said today.
European Central Bank chief Mario Draghi said on Thursday, 3 July 2104, after a policy meeting that borrowing costs will stay at current levels for an extended period after the introduction of unprecedented stimulus in June.
Asian stocks edged lower in choppy trade on Friday, 4 July 2014. Key benchmark indices in China, South Korea, Singapore and Taiwan were down 0.03% to 0.19%. Key benchmark indices in Indonesia, Hong Kong, and Japan were up 0.06% to 0.58%.
US stocks rose on Thursday, 3 July 2014, with the Dow Jones Industrial Average hitting record high above 17,000 for the first time and the S&P 500 index also scaling record high after the June jobs report came in much stronger than expected.
US employers added 288,000 workers to nonfarm payrolls in June, following a 224,000 increase in May that was bigger than previously estimated. A 1.39 million increase in employment over the past six months was the largest since early 2006, while the unemployment rate fell to 6.1%, the lowest level since September 2008.
US markets are closed today, 4 July 2104, for Independence Day holiday.
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