A divergent trend continued on the bourses as the barometer index, the S&P BSE Sensex swung alternately between positive and negative terrain in narrow range near the flat line in mid-morning trade. While, the 50-unit CNX Nifty held on to positive terrain, so far during the day. The Sensex was currently down 15.28 points or 0.06% at 27,569.99. The market breadth indicating the overall health of the market was strong.
Data after market hours yesterday, 12 January 2015, showed rebound of industrial output in November 2014 and the annual rate of inflation based on the combined consumer price indices (CPI) for urban and rural India rose in December 2014.
Oil exploration firms declined along with fall in crude oil prices. Shares of public sector oil marketing companies rose as global crude oil prices fell.
The Sensex had hit one-week high in early trade. The 50-unit CNX Nifty had hit its highest level in more than a week in early trade.
In overseas markets, most Asian markets rose after data showed China's exports climbed more than estimated in December 2014. US stocks ended lower yesterday, 12 January 2015, led by another sharp decline in energy shares as oil prices tumbled about 5% and concern grew ahead of corporate earnings season.
Foreign portfolio investors bought shares worth a net Rs 244.95 crore on Monday, 12 January 2015, as per provisional data.
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In the foreign exchange market, the rupee edged higher against the dollar.
Oil extended losses amid speculation that US crude stockpiles will increase, exacerbating a global supply glut that's driven prices to the lowest in more than 5-1/2 years. Deregulation of diesel price announced by the Indian government in October 2014 and a sharp decline in global crude oil prices over the past few months will help reduce the government's fuel subsidy burden and help contain its fiscal deficit. The steep slide in global crude oil prices will also help India in containing its current account deficit and fuel price inflation. India imports 80% of its crude oil requirement.
At 11:18 IST, the S&P BSE Sensex was down 15.28 points or 0.06% at 27,569.99. The index declined 30.50 points at the day's low of 27,554.77 in early trade. The index rose 84.92 points at the day's high of 27,670.19 in early trade, its highest level since 6 January 2015.
The CNX Nifty was up 13.70 points or 0.16% at 8,336.70. The index hit a high of 8,356.30 in intraday trade, its highest level since 5 January 2015. The index hit a low of 8,321.85 in intraday trade.
The BSE Mid-Cap index was up 62.12 points or 0.59% at 10,548.30. The BSE Small-Cap index was up 67.29 points or 0.6% at 11,358.79. Both these indices outperformed the Sensex.
The market breadth indicating the overall health of the market was positive. On BSE, 1,427 shares advanced and 953 shares declined. A total of 93 shares were unchanged.
Oil exploration firms declined along with fall in crude oil prices. ONGC (down 0.74%), Cairn India (down 0.81%), and Oil India (down 2.35%) dropped. Lower crude oil prices would result in lower realizations from crude sales for oil exploration firms.
Reliance Industries (RIL) declined 0.66%. The company after market hours yesterday, 12 January 2015 in a clarification with regard to news item titled Reliance announces Rs 1 lakh cr investment in 12-18 months said that this is just a reiteration of the statement, inter alia made by its Chairman in his speech at the fortieth annual general meeting of the company held on 18 June 2014. He said at that time In the past 37 years, we invested Rs 240000 crore and in this current three years' investment cycle, we will be investing over Rs 180000 crore. We are currently at the mid-point of the largest investment programee in Reliance's history. The next two years, 2014-15 and 2015-16, will see us focussed on executing and progressively bringing these projects on-stream in petrochemicals, refining, retail, and Jio.
RIL further said that the Chairman has mentioned clearly at the Summit inauguration function referred to in the subject newspaper report that the company will invest over Rs 100000 crore in the next 12-18 months in contributing to the Make-In-India and Digital India initiatives.
Shares of public sector oil marketing companies rose as global crude oil prices fell. BPCL (up 1.23%), Indian Oil Corporation (up 0.9%) and HPCL (up 1.69%) edged higher. Lower crude oil prices could reduce under-recoveries of PSU OMCs on domestic sale of LPG and kerosene at controlled prices. The government has already freed pricing of petrol and diesel.
Meanwhile, PSU OMCs review fuel prices during the middle of the month and on the last day of the month based on the average imported oil price in the preceding fortnight.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 62.09, compared with its close of 62.165 during the previous trading session.
Oil extended losses amid speculation that US crude stockpiles will increase, exacerbating a global supply glut that's driven prices to the lowest in more than 5-1/2 years. Brent for February settlement was off $1.01 a barrel to $46.42 a barrel. The contract had lost $2.68 a barrel to settle at $47.43 a barrel during the previous trading session. Brent for March settlement was off 76 cemts a barrel at $47.73 a barrel.
On macro front, India's Index of industrial production (IIP) increased at five-months high pace of 3.8% in November 2014, recovering from the sharpest pace in three-years at 4.2% recorded in October 2014. The manufacturing sector's output growth rebounded to 3.8% in November 2014, snapping the largest decline in the last five-and-a-half years at 7.4% recorded in October 2014.
The annual rate of inflation based on the combined consumer price indices (CPI) for urban and rural India rose to 5% in December 2014 from nine-year low of 4.4% in November 2014, while snapping consistent decline for last four sequential months. An increase in inflation food items contributed entirely to the inflation rise in November 2014. The IIP and CPI data was announced after market hours yesterday, 12 January 2015.
The rate of inflation based on the wholesale price index (WPI) is projected at 0.5% for December 2014, as per the median estimate of a poll of economist carried out by Capital Market. WPI inflation stood at zero in November 2014. The government will release data on WPI for December 2014 at 12 noon tomorrow, 14 January 2015.
Most Asian markets rose after data showed China's exports climbed more than estimated in December 2014. Key benchmark indices in China, Hong Kong, Indonesia and Taiwan were up by 0.8% to 0.65%. Key benchmark indices in Japan, Singapore and South Korea were off 0.13% to 1.52%.
China's exports climbed more than estimated last month as stronger demand from abroad helps bolster growth. Overseas shipments rose 9.7% in December from a year earlier. Imports fell 2.4%, leaving a trade surplus of $49.61 billion, the customs administration said in Beijing.
Trading in US index futures indicated that the Dow could gain 25 points at the opening bell today, 13 January 2015. US stocks ended lower yesterday, 12 January 2015, led by another sharp decline in energy shares as oil prices tumbled about 5% and concern grew ahead of corporate earnings season.
Meanwhile in Europe, uncertainties over the status of Greece including its possible exit from the eurozone are likely to persist until the early election in the country later this month. Greece is set to hold snap elections on 25 January 2015 after it failed to elect a new president in a third round of voting late last year. The Greek leftist opposition party Syriza leads opinion polls ahead of national elections on 25 January 2015. Syriza has demanded debt relief from the eurozone and promised to roll back the austerity and reform measures that the country has undertaken in exchange for the international bailout that the government negotiated in 2012.
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