Key benchmark indices snapped four day winning streak as investors nervously awaited the latest policy decision from the European Central Bank. The barometer index, BSE Sensex, shed 33.02 points or 0.19%, up about 67 points from the day's low and off close to 22 points from the day's high. The market breadth was positive. Index heavyweight and cigarette maker ITC hit record high. Index heavyweight Reliance Industries (RIL) trimmed intraday losses in volatile trade. Power generation major NTPC surged after block deals on BSE.
The Sensex had risen 617.56 points, or 3.71% in the previous four trading sessions to 17,257.38 on Wednesday, 1 August 2012, from a recent low of 16,639.82 on 26 July 2012. The Sensex has jumped 1769.44 points or 11.45% in calendar 2012 so far (till 2 August 2012). From a 52-week low of 15,135.86 on 20 December 2011, the Sensex has risen 2,088.50 points or 13.80%. From a 52-week high of 18,523.78 on 22 February 2012, the Sensex has lost 1299.42 points or 7.01%.
Shares of companies whose fortunes are linked to orders from Indian Railways and construction shares surged after Prime Minister Dr. Manmohan Singh today, 2 August 2012, approved relaxation in the land transfer policy of the government for government owned land so that infrastructure projects are not held up because of procedural delays. Airline stocks were mostly lower as state-owned oil companies on Wednesday raised jet fuel or ATF rates by a steep 4.5% on firming international crude oil prices.
Capital goods stocks extended recent gains. Interest rate sensitive banking stocks were mostly lower as the Reserve Bank of India (RBI) kept repo rate unchanged at its first quarter review of the Monetary Policy 2012-13 early this week. Lube oil major Castrol India hit record high. Ashok Leyland surged after strong sales in the month just gone by.
The market edged lower in early trade on weak Asian stocks. The market trimmed losses in morning trade. Intraday recovery witnessed in morning trade proved short lived, with key benchmark indices hitting fresh intraday lows in mid-morning trade. The market extended losses to hit fresh intraday low in early afternoon trade. Key benchmark indices pared losses in afternoon trade as European market opened higher. Intraday recovery witnessed in afternoon trade proved short lived as key benchmark indices weakened again in mid-afternoon trade. The market trimmed intraday losses in late trade.
The BSE Sensex fell 33.02 points or 0.19% to settle at 17,224.36, its lowest closing level since 30 July 2012. The index fell 100.10 points at the day's low of 17,157.28 in early afternoon trade. The index declined 11.37 points at the day's high of 17,246.01 in early trade.
The S&P CNX Nifty fell 12.75 points or 0.24% to settle at 5,227.75, its lowest closing level since 30 July 2012. The index hit a low of 5,209.95 in intraday trade. The Nifty hit high of 5,236.90 in intraday trade.
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The BSE Mid-Cap index rose 0.23% and the BSE Small-Cap index rose 0.47%. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,508 shares rose and 1,179 shares fell. A total of 130 shares were unchanged.
BSE clocked turnover of Rs 1750 crore, lower than Rs 1910 crore on Wednesday, 1 August 2012.
From the 30-share Sensex pack, 19 stocks fell and the rest of them rose. Jindal Steel & Power (up 1.06%), Bajaj Auto (up 0.63%) and Bharti Airtel (up 0.34%), were the major gainers from the Sensex pack.
Asian Paints gained 0.96% after the company said that it has received the certified Copy of the order passed by the High Court Mumbai approving the Scheme of Merger and Demerger which envisages merger of PPG Coatings India (a subsidiary of PPG in India) and AP Coatings (a wholly owned subsidiary of Asian Paints) with Asian PPG Industries (APPG) (existing Joint Venture between Asian Paints Group and PPG Group). The Scheme then provides for demerger of the Liquid Industrial Paints, Powder Coatings and Protective Coatings businesses from APPG into Asian Paints PPG (second Joint Venture company). The appointed date under the Scheme was April 01, 2012.
NTPC gained 3.78% to Rs 163.30 after 0.08% equity changed hands in multiple bulk deals on the BSE today, 2 August 2012. Several bulk deals aggregating to 71.41 lakh shares were executed on the NTPC counter at an average price of Rs 159.45 per share on the BSE today, 2 August 2012. On BSE, 76.67 lakh shares were traded in the counter as against average daily volume of 2.44 lakh shares in the past one quarter.
Shares of NTPC surged after M. Veerappa Moily after taking charge of the power ministry on Wednesday, 1 August 2012, said his ministry will keep the momentum of generation of capacity addition to achieve the increased target of more than 80,000 MW during the XII Plan Five Year Plan. "I recognize that this would require firmer fuel supply arrangement than hitherto indicated and I am confident that with the efforts and cooperation of Ministry of Coal, the situation would improve and bankable Fuel Supply Agreements would be signed. I may also inform you that in the first year of the 12th Plan, the achievement so far has been 6,216 MW against a target of nearly 16,000 MW (excluding nuclear)", Mr. Moily said.
Among the other challenges before the power sector today is the financial health of the Distribution Companies that need to be remedied for the long term sustainability of the sector, Mr. Moily said. "I am told that Distribution Companies, particularly in some states, are under huge financial stress and my endeavour would be to quickly finalise a debt restructuring scheme which is at present under inter-Ministerial consultations. I would seek the cooperation of the State Governments in taking long term measures, even if they appear stiff, for turning around the distribution utilities so that they could serve the consumers better", Mr. Moily said.
He also said that the power ministry proposes to extend the coverage under the R-APDRP scheme to include more towns so that their power distribution system can be modernised and their distribution losses brought down to 15%. Under the Rajiv Gandhi Gramin VidyutikaranYojana, already 1.05 lac unelectrified villages have been covered and 1.97 crore BPL households provided free electricity connections. The balance from the Phase 1 of the programme, namely, 6000 odd villages and about 35 lakh BPL families will be completed this year itself, Mr. Moily said.
Castrol India jumped 5.02% to Rs 586.25. The stock hit a record high of Rs 589.90 in intraday trade today, 2 August 2012. The company's board last month announced a liberal 1:1 bonus.
Capital goods stocks extended recent gains. L&T gained 0.60%. The company's recurring profit after tax rose 19% to Rs 890 crore on 26% growth in gross revenue to Rs 12078 crore in Q1 June 2012 over Q1 June 2011. The company announced the first quarter results last month. L&T said the healthy revenue growth in Q1 June 2012 was on the back of a strong order book and good progress in execution of various jobs. International sales constituted 17% of the total revenue in Q1 June 2012, L&T said in a statement.
L&T's order inflow jumped 21% to Rs 19594 crore in Q1 June 2012 over Q1 June 2011 despite weak investment sentiment and prevailing global uncertainties, the company said. The major orders came from infrastructure, buildings & factories and power transmission & distribution sectors, L&T said in a statement. L&T's order book stood at Rs 153095 crore as on 30 June 2012.
With regard to future business outlook, L&T said that with its enhanced capacities and presence in the diverse sectors, the company is in a good position to harness the opportunities as they emerge. The superior execution capabilities and growing order book provide visibility to sustained revenue growth in the medium term, L&T said in a statement.
On the international front, select markets in the Middle East, South East Asia and CIS countries hold promising prospects where the company is strengthening its presence, L&T said in a statement.
State-run power equipment maker Bhel rose 1.25%. Bhel's net profit rose 12.92% to Rs 920.90 crore on 16.46% growth in total income to Rs 8805.28 crore in Q1 June 2012 over Q1 June 2011. The company announced the results on 26 July 2012. The company's order book position declined to Rs 132900 crore as on 30 June 2012 from Rs 134681 crore as on 31 March 2012.
Interest rate sensitive banking stocks were mostly lower as the Reserve Bank of India (RBI) kept repo rate unchanged at its first quarter review of the Monetary Policy 2012-13 early this week. India's second biggest private sector bank in terms of branch network HDFC Bank declined 0.85%.
State Bank of India (SBI) dropped 0.89%. SBI said today, 2 August 2012, said it has decided to revise downwards the interest rate on domestic term deposits for tenors of 5 years and above to 8.5% from 7 August 2012.
Punjab National Bank (PNB) fell 0.45%. The bank has decided to increase rate of interest on single domestic term deposit of less than Rs 1 crore from 8.75% to 9% for maturity of one year from August 02, 2012. The same shall also be applicable to NRE term deposits. Similarly, the interest rate of 9% will also be applicable to NRE term deposits of 1,111 days as applicable to domestic term deposits, PNB said.
India's largest private sector bank by net profit ICICI Bank rose 0.03%. The bank's profit after tax jumped 36% to Rs 1815 crore on 32% growth in net interest income to Rs 3193 crore in Q1 June 2012 over Q1 June 2011. ICICI Bank's net interest margin (NIM) improved to 3.01% for Q1 June 2012, from 2.61% for Q1 June 2011. The bank announced the results on 27 July 2012.
Ashok Leyland surged 4.31% to Rs 23 after the company said its total sales jumped 25% to 9,785 units in July 2012 over July 2011. The company's light commercial vehicle (LCV) Dost which was launches last year clocked sales of 2,803 units in July 2012. Ashok Leyland's commercial vehicles sales, excluding LCV Dost, declined 11% to 6,982 units in July 2012 over July 2011.
Index heavyweight and cigarette maker ITC rose 1% to Rs 261.35. The stock hit a record high of Rs 262.05 in intraday trade today, 2 August 2012. The company last week reported 20.21% growth in net profit to Rs 1602.14 crore on 15.34% growth in net sales to Rs 6652.21 crore in Q1 June 2012 over Q1 June 2011. Despite series of tax hikes, ITC's performance in cigarettes business remains robust and displays pricing power for the company.
Index heavyweight Reliance Industries (RIL) declined 0.8% to Rs 739.45. The stock hit a high of Rs 747.40 and a low of Rs 736.45. RIL has bought back 3.66 crore shares for about of Rs 2617.57 crore till 24 July 2012 under its ongoing share buyback program. RIL has set maximum buyback price of Rs 870 per share. The company has set aside Rs 10440 crore for share buyback. The buyback program opened on 1 February 2012 and closes on 19 January 2013. RIL chairman Mukesh Ambani said at the company's Annual General Meeting in June 2012 that the company's buyback program represents a highly accretive use of cash by the company and it will supplement earnings growth from operations, for higher EPS (earnings per share), in the near future.
Airline stocks were mostly lower as state-owned oil companies on Wednesday raised jet fuel or ATF rates by a steep 4.5% on firming international crude oil prices. Kingfisher Airlines and SpiceJet shed by between 0.64% to 2.76%. But, Jet Airways rose 1.56%.
ATF typically makes up almost half of an airline's operating cost and the increase in prices will increase the burden of cash-strapped airlines. PSU OMCs revise jet fuel prices on the 1st and 16th of every month, based on the average international price in the preceding fortnight.
Shares of companies whose fortunes are linked to orders from Indian Railways surged after Prime Minister Dr. Manmohan Singh today, 2 August 2012, approved relaxation in the land transfer policy of the government for government owned land so that infrastructure projects are not held up because of procedural delays. Kernex Microsystems (up 2.99%), Kalindee Rail Nirman (Engineers) (up 1.67%), Titagarh Wagons (up 1.29%), BEML (up 0.76%), Texmaco (up 0.67%) and Transformers and Rectifiers (India) (up 0.03%), edged higher.
Early last year, a ban was imposed on all transfer of government owned lands to any entity except in cases where land was to be transferred from one government department to another. The Prime Minister has now relaxed the ban for certain categories of projects by allowing land alienation for development and use of railway land by Rail Land Development Authority (RLDA) as per provisions of Railways Amendment Act, 2005 and the Rules framed thereunder and in accordance with the prevalent policies and guidelines of the Railway Ministry and the Government.
Construction shares rose after Prime Minister Dr. Manmohan Singh today, 2 August 2012, approved relaxation in the land transfer policy of the government for government owned land so that infrastructure projects are not held up because of procedural delays. This would speed up the award of public private partnership (PPP) projects from this month onwards significantly, the Prime Minister's office (PMO) said in a statement.
Roman Tarmat (up 6.74%), IVRCL (up 3.72%), C & C Constructions (up 3.52%), NCC (up 3.15%), Hindustan Construction Company (up 1.12%), Valecha Engineering (up 1.09%), KNR Constructions (up 1.03%), Simplex Infrastructures (up 0.97%), PBA Infrastructure (up 0.69%), Sadbhav Engineering (up 0.58%) and Pratibha Industries (up 0.22%), edged higher.
All PPP infrastructure projects -- roads, railways, ports, civil aviation and metros -- have some element of land alienation as the project is often built on government owned land. The government continues to own the land which is leased or licensed out. Requiring Cabinet approval for each PPP project meant adding a few months to complete the processes for securing Cabinet approval.
NIIT Technologies clocked a highest turnover of Rs 156.02 crore on BSE. NTPC (Rs 122.35 crore), State Bank of India (Rs 71.78 crore), United Spirits (Rs 65.34 crore) and ICICI Bank (Rs 48.88 crore), were the other turnover toppers on BSE in that order.
Marmagoa Steel reported a highest volume of 1.25 crore shares on BSE. Cals Refineries (99.68 lakh shares), NTPC (76.68 lakh shares), NIIT Technologies (57.70 lakh shares) and SpiceJet (37.26 lakh), were the other volume toppers on BSE in that order.
Shrinking export orders and sluggish output dragged Indian manufacturing growth in July down to its weakest pace since last November, a business survey showed on Wednesday. The HSBC manufacturing Purchasing Managers' Index (PMI), which gauges business activity at India's factories but not utilities, fell to 52.9 in July, from 55 in June -- its biggest one-month drop since September last year. Still, the index has remained above the 50 mark that divides growth and contraction for more than three years. Manufacturing accounts for around 15% of India's gross domestic product.
India's merchandise exports declined 5.45% to $25.06 billion in June 2012, data released by the Ministry of Commerce & Industry showed. Cumulative value of exports for the period April-June 2012 declined 1.7% to $75.20 billion from a year earlier. India's imports declined 13.46% to $35.37 billion in June 2012. Cumulative value of imports for the period April-June 2012 declined 6.1% to $115.25 billion from a year earlier. Oil imports declined 4.43% to $12.68 billion in June 2012. Oil imports during April-June 2012 rose 5.48% to $41.58 billion from a year earlier.
Trade deficit narrowed to $10.30 billion in June 2012 from $14.36 billion a year earlier, according to the data. The trade deficit for April-June 2012 narrowed to $40.05 billion from $46.23 billion during April-June 2011.
A panel of ministers on Tuesday, 31 July 2012, approved steps to contain the impact of a near-drought situation. The steps include providing diesel-price subsidies to farmers, increasing the subsidy on seed supplies, and removal of the import tax on oil meals, Farm Minister Sharad Pawar told reporters on Tuesday. He said there is a major decline in planting areas of rice, coarse cereals and lentils due to weak monsoon rains. The diesel-price subsidy announced by the government will be 50% on the sale price for drought-hit farmers and total expenditure would be around Rs 1260 crore, which would be shared equally by the central government and respective state governments.
The monsoon rainfall until July 31 was 19% below the long-term average, with some areas getting little or no rain and some others seeing excessive rain and flooding. There will be an impact on foodgrain output, but it is too early to give any estimate, Mr. Pawar said. The worst affected states due to scanty rains are Punjab, Haryana, Karnataka, and parts of Maharashtra and Gujarat, he added. Punjab and Haryana are major rice producers. Maharashtra and Gujarat are major producers of oilseeds and cotton.
With the monsoon season almost halfway through, India is facing the prospect of a full-blown drought in some of its provinces. Mr. Pawar said the government will raise subsidies for the supply of various seeds for alternate crops in affected areas.
Minister of State for Agriculture Harish Rawat early this week said rainfall in August, a critical month for summer crops, is likely to be 84%-85% of the long-term average, below the previous forecast of 96%. The monsoon rains--which make up around 70% of India's annual rainfall--are crucial to the nation's agriculture sector and broader economy. More than 60% of the country's farmland is rain-fed. The timing, distribution and quantity of rainfall are all important for crops. The four-month southwest monsoon season that starts from June accounts for almost 70% of total annual moisture that Indian soil receives in a year.
A bad monsoon will have a larger impact on inflation than on growth as agriculture output constitutes a relatively small portion of India's economy, Indian central bank officials said on Wednesday, 1 August 2012, in a conference call following the release of its monetary policy review on Tuesday, 31 July 2012. The Reserve Bank of India (RBI) on Tuesday, 31 July 2012, kept its key policy rate viz. the repo rate unchanged at 8% after first quarter review of Monetary Policy 2012-13 in an effort to keep a lid on inflation and inflation expectations. The RBI, however, lowered banks' statutory liquidity ratio, or the part of deposits that must be invested mainly in government bonds, by a percentage point to 23% to ensure that liquidity pressures do not constrain the flow of credit to productive sectors of the economy.
Principal adviser to the Planning Commission Pronab Sen last week said slowing investment due to weak confidence in the economy is hurting growth. Mr. Sen said Indian companies aren't facing any shortage of funds. Many of them are sitting on piles of cash and aren't even repatriating overseas borrowings, he added.
The government should take steps to meet the fiscal deficit target set out in the budget and that would improve sentiment and revive investments, Mr. Sen said. He said the government should scale back its spending and slash subsidies on fuels, food and fertilizers to help check its budget deficit. Slowing growth in investment remains a cause for concern for India. Investment makes up 35% of India's economic activity.
The services purchasing managers' index for July 2012 is expected to be released tomorrow, 3 August 2012. HSBC's services purchasing managers' index, which gauges the activity of around 400 firms in India, dropped to 54.3 in June from 54.7 in May. However, it has kept above the 50 mark that signifies growth since November.
Prime Minister Dr. Manmohan Singh has decided to refer the issue of implications on FIIs and portfolio investors of the amendment made to the Income Tax Act relating to the taxation of non-resident transfer of assets where the underlying asset is in India to the Expert Committee on anti-avoidance tax proposal viz. the General Anti-Avoidance Rules (GAAR). "It is necessary to have clarity on the tax liability of portfolio investors and foreign institutional investors as a result of this amendment particularly when the investment is made through a registered stock exchange in accordance with SEBI guidelines and purely in the form of portfolio investment", the Prime Minister's Office (PMO) said in a statement issued Monday, 30 July 2012. Any clarification needs to be harmonised with the GAAR guidelines and will have to address any residual concerns outside of GAAR, the PMO said.
Dr. Singh last month constituted an expert committee on anti-avoidance tax proposal viz. the General Anti-Avoidance Rules (GAAR) to undertake stakeholder consultations and finalise the guidelines for GAAR by 30 September 2012.
An India-Mauritius joint panel will discuss a series of proposals to review the double taxation avoidance treaty between the two nations on 22-24 August in Mauritius. India has been looking to negotiate the double taxation avoidance agreement with Mauritius for the past few years to check so-called round tripping and other potential abuses. Round tripping entails moving money out of one country to another, and getting it back under the garb of foreign capital. Capital gains tax is close to zero in Mauritius and almost 40% of investments into India come through the island nation. Under the bilateral agreement, capital gains from sale of securities can be taxed only in Mauritius. The India-Mauritius joint working group will also discuss the inclusion of a so-called limitation of benefit clause, similar to the Singapore tax treaty with India, to ensure only genuine Mauritius-based companies are benefited. India's tax agreement with Singapore says that only those companies that spend a minimum of $200,000 (about Rs 1 crore) in Singapore can avail the benefits of the treaty.
Sanctity of tax residency certificates issued by a country to companies operating in its jurisdiction to enable the firms to claim tax benefits under various treaties is another issue between India and Mauritius. While India in this year's national budget said the certificates are a necessary but not sufficient condition, Mauritius wants those issued by it honoured. Draft guidelines issued by Indian government for implementing the controversial anti-avoidance tax proposal viz. the GAAR state that GAAR provisions should be invoked on a foreign institutional investor (FII), if it chooses to take a treaty benefit, but would not in any case be invoked in the case of the non-resident investors of the FII. The draft guidelines suggested that the onus of proving wrongdoing should be on the authorities. Voting for the country's new vice president takes places on 7 August 2012 -- a day before the monsoon session of parliament kicks off.
The monsoon session of the parliament will begin on 8 August 2012 and the session will conclude on 7 September 2012, Parliamentary Affairs Minister Pawan Kumar Bansal said on Wednesday, 18 July 2012. The government hasn't yet finalized the agenda for the session, but the expectation is that Prime Minister Dr. Manmohan Singh -- who took charge of the finance ministry after Mr. Pranab Mukherjee resigned to contest the presidential elections -- will try and push through long-pending legislations. These could include the Direct Tax Code and the insurance, pension and banking bills. The government would also place before lawmakers the first demand for additional spending for this fiscal year which began April 1.
Corporate affairs minister Veerappa Moily said in a newspaper interview published on 11 July 2012 that the government is hopeful of the passage of the pension bill in the monsoon session of parliament.
Investors' focus is currently on Q1 June 2012 earnings. DLF and Steel Authority of India unveil Q1 results on 6 August 2012. Mahindra & Mahindra and Bharti Airtel unveil Q1 results on 8 August 2012. Tata Motors and Ranbaxy Laboratories unveil quarterly results on 9 August 2012. State Bank of India, Sun Pharmaceuticals Industries, Siemens and BPCL announce quarterly results on 10 August 2012. ONGC announces Q1 results on 11 August 2012. Tata Steel and Coal India unveil Q1 results on 13 August 2012. Hindalco Industries and IDFC will unveil Q1 results on 14 August 2012.
European stock markets edged higher on Thursday, led by banks and oil firms, as investors awaited the latest policy decision from the European Central Bank, hoping for action to curb the region's debt crisis. Key benchmark indices in France, UK and Germany were up by 0.37% to 0.59%.
The Governing Council of the European Central Bank (ECB) holds a monthly monetary policy review on interest rates for the euro area on today, 2 August 2012. Resistance by German officials to resuming ECB purchases of distressed government bonds has dampened expectations somewhat for big measures from ECB. ECB is widely expected to leave interest rates unchanged after it cut the benchmark one-week lending rate to a fresh record low last month. ECB President Mario Draghi last week said that the bank would do whatever was needed to save the euro.
The Bank of England's Monetary Policy Committee (MPC) on Thursday, 2 August 2012, voted to leave the key lending rate at a record low 0.5%. The MPC also voted not to alter the plan initiated last month to increase the size of its stock of asset purchases to 375 billion pounds ($583 billion) from 325 billion.
Germany's Federal Constitutional Court will announce a decision on lawsuits challenging the country's participation in the permanent euro-zone rescue fund, the European Stability Mechanism, and the fiscal pact on 12 September 2012. The court held a public hearing earlier this month to examine complaints that participation in the fund and the fiscal pact violated German law by taking some authority over the national budget away from parliament.
Asian shares eased on Thursday as investors turned increasingly cautious as hopes of stimulus action by central banks thinned ahead of a European Central Bank's meeting later in the day and after the US Federal Reserve took no action a day earlier. Key benchmark indices in China, Hong Kong, Indonesia, South Korea and Singapore fell by between 0.49% to 0.9%. Japan's Nikkei Average rose 0.13%.
The People's Bank of China on Thursday, 2 August 2012, said it will make stabilizing economic growth a bigger priority, signalling rising concern at the slowdown in the world's second-largest economy. The central bank, in its second-quarter monetary policy report, repeated a standard formulation that it would balance the three objectives of maintaining steady and relatively fast growth, adjusting the economic structure and managing inflation expectations. But it added new language on growth, saying it would "put stabilizing growth in a more important position," signalling that it sees the slowdown as the biggest risk in the Chinese economy, and signalling that it may take further measures to boost growth.
China's central bank drained a net 86 billion yuan ($13.6 billion) from the banking system this week via its regular open-market operations, highlighting its concerns that inflation may rebound later this year despite recent data showing the country's July manufacturing activity undershot market expectations. Premier Wen Jiabao warned on Tuesday that China's economic growth continues to face downward pressure and called for more efforts to enhance policy fine-tuning to ensure growth. Mr. Wen's comments came one day before data issued Wednesday showed China's official manufacturing Purchasing Managers Index fell in July for a third consecutive month to 50.1 compared with 50.2 in June. That was the least since November last year.
Trading in US index futures indicated that the Dow could gain 44 points at the opening bell on Thursday, 2 August 2012. US stocks fell on Wednesday after the Federal Reserve took no new monetary stimulus after a two-day policy meeting. The Federal Reserve stopped short of offering new monetary stimulus on Wednesday even as it signaled further bond buying could be in store to help a US economic recovery that it said had lost momentum this year. Fed officials described the economy as having "decelerated somewhat," a change of tone from its previous assessment in June when it said the economy had been "expanding moderately". The Fed's policymakers also reiterated their disappointment with the slow pace of progress in bringing down the nation's 8.2 percent jobless rate. "The Committee will closely monitor incoming information on economic and financial developments and will provide additional accommodation as needed," the Fed said in its statement.
A report on Wednesday showed US companies added 163,000 jobs in July, more than expected. Separately, manufacturing data from the Institute for Supply Management pointed to a second month of contraction in the factory sector.
Data on weekly jobless claims in the US and data on factory orders are due for release on Thursday, 2 August 2012. US retailers will also unveil monthly same-store sales data today.
The influential US government data on non-farm payroll for July 2012 is due tomorrow, 3 August 2012. In June, the United States created 80,000 jobs, the third straight month of job growth of under 100,000.
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