Key benchmark indices extended intraday gains in afternoon trade. The barometer index, the S&P BSE Sensex, was up 215.96 points or 0.9%, up about 230 points from the day's low and off close to 90 points from the day's high. The market breadth, indicating the overall health of the market, was strong. The BSE Mid-Cap index was up nearly 3%. The BSE Small-Cap index was up more than 4.5%. Both these indices outperformed the Sensex. The market sentiment was upbeat after a clear mandate given by voters the Bharatiya Janata Party (BJP) led National Democratic Alliance (NDA) in the recently concluded Lok Sabha elections. The market sentiment was also boosted by Narendra Modi's comments in his victory speeches in his home state of Gujarat on Friday, 16 May 2014, where he stressed on the country's development and good governance. Modi will become India's next Prime Minister. The market sentiment was also boosted by a statement from global credit rating agency Moody's Investor Service that BJP's resounding election win is credit positive for India as it boosts the prospect that a stable government will address the country's economic challenges. The market sentiment was also boosted by data showing that foreign funds made massive purchases of Indian stocks on Friday, 16 May 2014, the day when Modi-led BJP routed the Congress-led United Progressive Alliance (UPA) across the nation, registering the biggest ever win for any single party since 1984 in Lok Sabha elections.
Investors expect measures for revival of the economy, business-friendly policies and good governance from Modi-led government after the clear mandate given by voters to the BJP-led NDA. Investors expect policy measures from the new government to put India on a high-growth path on a sustainable basis.
Modi is perceived as being business-friendly and a decisive leader by the business community. As chief minister for the fast-growing state of Gujarat, Modi has built a reputation for getting things done.
PSU OMCs extended Friday's rally triggered by drop in under-recovery on High Speed Diesel (HSD), with BPCL scaling record high and HPCL and Indian Oil Corporation hitting 52-week high. Shares of upstream oil and gas companies also surged with GAIL (India) hitting 52-week high. Realty stocks also jumped.
Key benchmark indices trimmed gains after a firm opening triggered by data showing that foreign funds made heavy purchases of Indian stocks on Friday, 16 May 2014, the day when Modi-led BJP routed the Congress-led United Progressive Alliance (UPA) across the nation, registering the biggest ever win for any single party since 1984 in Lok Sabha elections. Key benchmark indices further trimmed intraday gains in morning trade. Volatility ruled the roost as the key benchmark indices regained positive zone after reversing intraday gains in mid-morning trade. Key benchmark indices extended intraday gains in early afternoon trade. It further strengthened in afternoon trade.
The market sentiment was boosted by data showing that foreign funds made heavy purchases of Indian stocks on Friday, 16 May 2014. Foreign institutional investors (FIIs) bought shares worth a net Rs 3634.82 crore on Friday, 16 May 2014, as per provisional data from the stock exchanges.
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At 13:20 IST, the S&P BSE Sensex was up 215.96 points or 0.9% to 24,337.70. The index jumped 305.36 points at the day's high of 24,427.10 in early trade. The index fell 13.75 points at the day's low of 24,107.99 in mid-morning trade.
The CNX Nifty was up 57.35 points or 0.8% to 7,260.35. The index hit a high of 7,290.35 in intraday trade. The index hit a low of 7,193.55 in intraday trade.
The BSE Mid-Cap index was up 226.43 points or 2.92% at 7,992.15. The BSE Small-Cap index was up 364.18 points or 4.62% at 8,249.94. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1,872 shares gained and 758 shares fell. A total of 113 shares were unchanged.
Among the 30-share Sensex pack, 21 stocks gained and rest of them declined. Coal India (up 11.28%), Tata Power Company (up 6.79%) and NTPC (up 6.14%) edged higher from the Sensex pack.
PSU OMCs extended Friday's rally triggered by a drop in under-recovery on High Speed Diesel (HSD). BPCL jumped 6.86% to Rs 584.95 after hitting record high of Rs 588.50 in intraday trade.
HPCL surged 6.8% to Rs 432 after hitting 52-week high of Rs 435.95 in intraday trade.
Indian Oil Corporation (IOCL) vaulted 5.7% to Rs 345 after hitting 52-week high of Rs 346.80 in intraday trade.
The Petroleum Planning and Analysis Cell (PPAC) under the Ministry of Petroleum and Natural Gas has reviewed international prices of crude oil and petroleum products during the first fortnight of May 2014. Accordingly, the under-recovery on High Speed Diesel (HSD) applicable for 2nd fortnight of May, effective from 16 May 2014, will go down to Rs 4.41 per litre. This was Rs 6.80 per litre during first fortnight of May 2014. In the case of PDS Kerosene, the under-recovery for the second fortnight of May 2014 will be Rs 33.84 per litre, lower than Rs 34.85 per litre during the first fortnight of May 2014.
Oil Marketing Companies (OMCs), effective 16th May 2014, are now incurring combined daily under-recovery of about Rs 318 crore on the sale of Diesel, PDS Kerosene and Domestic LPG. This is less than Rs 342 crore daily under-recoveries during the first fortnight of May 2014.
Shares of upstream oil & gas companies also surged. GAIL (India) rose 5.03% to Rs 430. The stock hit 52-week high of Rs 430.25 in intraday trade.
Index heavyweight Reliance Industries (RIL) rose 2.48% to Rs 1,107.35. RIL said its board has recommended the appointment of Nita M. Ambani, the Chairperson of Reliance Foundation, as a director on the board of RIL. She is being nominated to the board in place of Ramnik H. Ambani, who is retiring at the age of 90 years. The announcement was made after market hours on Friday, 16 May 2014.
ONGC surged 6.34% to Rs 409.35. ONGC on Sunday, 18 May 2014, said that the company has scaled its highest-ever market capitalization of Rs 3.56 lakh crore in intra-day trade on 16 May 2014, indicating its hidden potential to its investors. In intra-day trade on 16 May 2014, ONGC scrip logged a new peak of Rs 416.35 (on National Stock Exchange), taking its market capitalization to highest ever value.
ONGC said its market capitalisation is 51% higher than the next highest valuable company among the listed CPSEs. ONGC said that the company remains committed to create more value for all its stakeholders.
Shares of Oil India jumped 6.17%. Cairn India rose 2.26%.
Petronet LNG surged 7.72%.
Realty stocks jumped. D B Realty (up 9.12%), DLF (up 4.16%), Housing Development & Infrastructure (up 4.89%), Sobha Developers (up 2.5%) and Unitech (up 12.08%) gained.
Jayant Agro-Organics tumbled 11.14% after consolidated net profit fell 37.45% to Rs 4.76 crore on 16.75% decline in total income from operations to Rs 394.49 crore in Q4 March 2014 over Q4 March 2013. The Q4 result was announced during trading hours today, 19 May 2014.
In the foreign exchange market, the rupee edged higher against the dollar on expectations of continued robust foreign buying in domestic shares and debt after the Bharatiya Janata Party (BJPL) swept the country's Lok Sabha elections. The partially convertible rupee was hovering at 58.45, compared with its close of 58.79/80 on Friday, 16 May 2014.
Global credit rating agency Moody's Investor Service today, 19 May 2014, said that the Bharatiya Janata Party's resounding election win is credit positive for India as it boosts the prospect that a stable government will address the country's economic challenges. Moody's rates India "Baa3", the lowest investment-grade rating with a "stable" outlook. "The completion of the election will allow stalled policies relating to the corporate and infrastructure sectors to resume, a credit positive for the country's corporates. Closer co-ordination between the central and state governments on clearances for mega projects and land use, two proposals outlined in the BJP's manifesto, would address investment delays," Vikas Halan, vice president and senior credit officer at Moody's, said in a statement.
Global credit rating agency Standard & Poor's Ratings Services on Friday, 16 May 2014, said that the fiscal and economic reforms taken by India's new government in the next two to three months will have significant implications on India's sovereign credit rating. S&P's statement came after Narendra Modi-led Bharatiya Janata Party (BJP) routed the Congress-led United Progressive Alliance (UPA) across the nation, registering the biggest ever win for any single party since 1984 in Lok Sabha elections. Modi is likely to be sworn in as India's Prime Minister on Wednesday, 21 May 2014.
S&P said that the next government would need to regain fiscal prudence in a sustainable way, such as by implementing a goods and services tax to help stabilise government revenues. "What the next government says and does in the coming months is crucial to boosting confidence in the policy settings and the economy. If confidence rises, investment and consumption in India could strengthen, after being held back by the uncertainty surrounding the election," S&P credit analyst Takahira Ogawa was quoted as saying in the statement.
S&P is the only of the three major credit agencies to have India with a "negative outlook" for its "BBB-minus" rating, meaning any downgrade would send the country to below investment grade.
After Bharatiya Janata Party (BJP) led National Democratic Alliance's (NDA) landslide victory in Lok Sabha election, investors' focus has shifted to the likely allocation of key ministerial portfolios in the National Democratic Alliance (NDA) government and the first budget of the new government expected by July 2014. An interim budget was presented by P. Chidambaram in February this year. Essentially, in the nature of a vote on account, the interim budget was intended to get Parliament approval for expenditure to be incurred during the first few months of fiscal year 2014-15 due to Lok Sabha elections.
US President Barack Obama invited Narendra Modi to Washington in a phone call on Friday, 16 May 2014, to congratulate him on his victory in the country's elections, the White House said. "The President noted he looks forward to working closely with Mr. Modi to fulfill the extraordinary promise of the US-India strategic partnership, and they agreed to continue expanding and deepening the wide-ranging cooperation between our two democracies," the White House said in a statement. The White House didn't specify a time frame for Mr. Modi's visit but said it would take place at a mutually agreeable time. US Secretary of State John Kerry also extended his congratulations to Mr. Modi.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014, as consumer-price inflation eased to a two-year low and as the rupee firmed up against the dollar.
European stocks were little changed in early trade on Monday, 19 May 2014. Key benchmark indices in Germany and UK shed 0.1% to 0.32%. France's CAC 40 rose 0.03%.
Asian stocks edged lower on Monday, 19 May 2014, after data showed a spreading slowdown in China's housing market. Key benchmark indices in Indonesia, Singapore, Japan, Hong Kong and China were off 0.01% to 1.05%. Key benchmark indices in South Korea and Taiwan were up 0.08% to 0.13%.
China's new-home prices rose in April in the fewest cities in 1-1/2 years as developers offered discounts and the economy slowed, prompting the easing of property curbs in some places. Prices last month climbed in 44 of the 70 cities tracked by the government compared with 56 cities in March. That was the fewest cities with price gains since October 2012, when increases were recorded in only 35 on a monthly basis.
Trading in US index futures indicated that the Dow could fall 19 points at the opening bell on Monday, 19 May 2014. US stocks closed higher on Friday, 16 May 2014, after an abrupt late-day reversal.
In economic data, construction on new US homes surged in April to the fastest pace in five months, with the volatile apartment category leading that jump, according to government data released Friday.
The preliminary May reading of the University of Michigan and Thomson Reuters's gauge of consumer sentiment fell unexpectedly to 81.8 from 84.1 in April.
The Federal Reserve releases minutes from the April 29-30 meeting of Federal Open Market Committee on Wednesday, 21 May 2014. The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 17-18 June 2014. The Fed on 30 April 2014 said after a monetary policy review that it will keep the benchmark interest-rate target at almost zero for a "considerable time" after its bond-buying program ends. The FOMC also reduced monthly debt purchases to $45 billion, its fourth straight $10 billion cut, and said further reductions are likely in "measured steps" if the economy continues to improve.
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