Key benchmark indices rebounded from intraday low to regain positive zone in mid-afternoon trade as European stocks rose after the US Federal Reserve after a monetary policy review on Wednesday, 18 June 2014, said a highly accommodative stance of monetary policy remains appropriate for the US economy at this juncture. The barometer index, the S&P BSE Sensex, was up 3.90 points or 0.02%, up 180.49 points from the day's low and off 175.70 points from the day's high. The market breadth indicating the overall health of the market was negative.
Many PSU stocks declined after reports indicated that the Securities and Exchange Board of India (Sebi) at its board meeting today, 19 June 2014, has ruled that all listed state-run companies should have at least 25% public shareholding in three years. Shares of United Spirits dropped. Shares of companies whose fortunes are linked to orders from Indian Railways rose on reports the government is moving swiftly to allow foreign direct investment in railways. Among FMCG stocks, Colgate Palmolive (India) hit 52-week high. VIP Industries and D B Realty hit 52-week high. Rallis India and MindTree scaled record high.
At 14:18 IST, the S&P BSE Sensex was up 3.90 points or 0.02% to 25,250.15. The index lost 176.59 points at the day's low of 25,069.66 in early afternoon trade, its lowest level since 16 June 2014. The index jumped 179.60 points at the day's high of 25,425.85 in early trade.
The CNX Nifty was up 2.30 points or 0.03% to 7,560.50. The index hit a low of 7,502.55 in intraday trade, its lowest level since 16 June 2014. The index hit a high of 7,606.45 in intraday trade.
The market breadth indicating the overall health of the market was negative. On BSE, 1,498 shares declined and 1,436 shares gained. A total of 108 shares were unchanged.
The BSE Mid-Cap index was off 10.17 points or 0.11% at 9,025.08, underperforming the Sensex. The BSE Small-Cap index was up 15.92 points or 0.16% at 9,889.56, outperforming the Sensex.
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Among the 30-share Sensex pack, 16 stocks declined and the rest of them gained. Mahindra & Mahindra (up 1.78%), Tata Motors (up 1.52%) and Infosys (up 1.51%) edged higher from the Sensex pack.
Many PSU stocks declined after reports indicated that the Securities and Exchange Board of India (Sebi) at its board meeting today, 19 June 2014, has ruled that all listed state-run companies should have at least 25% public shareholding in three years.
Coal India (down 0.86%), Steel Authority of India (Sail) (down 2.48%), NMDC (down 0.2%), and National Aluminium Company (Nalco) (down 2.77%) declined. MMTC (up 3.54%) and NHPC (down 1.14%) rose. The government holds a stake of 80% or more in these state-run companies.
United Spirits dropped 6.66%. United Spirits is yet to announce its Q4 and year ended 31 March 2014 results.
Colgate Palmolive (India) rose 2.32% to Rs 1,560.65 after hitting a 52-week high of Rs 1,570 in intraday trade.
Shares of companies whose fortunes are linked to orders from Indian Railways rose on reports the government is moving swiftly to allow foreign direct investment in railways. Simplex Casting (up 5%), Stone India (up 4.91%), Kalindee Rail Nirman (Engineers) (up 4.98%), Titagarh Wagons (up 4.99%), Kernex Microsystems (India) (up 2.18%), BEML (up 1.49%), Bharat Heavy Electricals (up 1.04%) edged higher.
As per reports, the commerce and industry ministry has initiated the exercise to allow 100% foreign direct investment (FDI) in several segments of railways, moving beyond its earlier plan to open select sectors such as high-speed train systems, dedicated freight lines built through the public-private partnership route and in certain areas of suburban rail networks. Currently, there is a complete ban on any kind of FDI in railways, except mass rapid transport systems.
VIP Industries jumped 6% to Rs 115.75 after hitting a 52-week high of Rs 118.50 in intraday trade.
Rallis India gained 3.83% to Rs 212.75 after hitting a record high of Rs 217.70 in intraday trade.
MindTree advanced 3.69% to Rs 860.90 after hitting a record high of Rs 872 in intraday trade.
D B Realty surged 6.6% to Rs 109 after hitting a 52-week high of Rs 116.20 in intraday trade.
Key benchmark indices edged higher in early trade as Asian stocks rose after the US Federal Reserve on Wednesday, 18 June 2014, after a monetary policy review said a highly accommodative stance of monetary policy remains appropriate at this juncture. Volatility struck the bourses in morning trade as the key benchmark indices retreated from intraday high hit in early trade only to regain strength later. The 50-unit CNX Nifty regained positive zone soon after reversing intraday gain to briefly turn negative. Volatility continued in mid-morning trade as the key benchmark indices regained positive zone after hitting fresh intraday low in negative zone. Key benchmark indices extended fall and hit fresh intraday low in early afternoon trade. Key benchmark indices recovered from the day's low in afternoon trade as European stocks rose in early trade there. Key benchmark indices rebounded from intraday low to regain positive zone in mid-afternoon trade.
Brent crude rose as investors worried about exports from Iraq as militant violence in the country continues. Brent crude futures for August delivery were up 10 cents at $114.36 a barrel. The contract had risen 81 cents to settle at $114.26 a barrel on Wednesday, 18 June 2014, the highest level since 6 September 2013.
Increase in oil prices has triggered macroeconomic worries for India which imports majority of its crude oil requirements. Increase in crude oil prices have raised concerns of increase in fuel price inflation and increase in India's current account deficit and fiscal deficit.
In the foreign exchange market, the rupee edged higher against the dollar after the US Federal Reserve signalled that interest rates will stay low for a while yet. The partially convertible rupee was hovering at 60.04, compared with its close of 60.39/40 on Wednesday, 18 June 2014.
European shares edged higher on Thursday, 19 June 2014, as investor sentiment received a boost from the Federal Reserve which said the US economy is rebounding and that US interest rates would stay low for some time. Key benchmark indices in UK, France and Germany were up 0.71% to 0.74%.
Asian markets edged lower on Thursday, 19 June 2014, as crude rose as investors worried about exports from Iraq as militant violence in the country continues. Key benchmark indices in Taiwan, South Korea and Japan rose by 0.13% to 1.62%. Key benchmark indices in Singapore, Hong Kong, Indonesia and China fell by 0.02% to 1.55%.
Chinese Premier Li Keqiang vowed that his nation's economy will not suffer a so-called "hard landing," a report said.
Trading in US index futures indicated a flat opening of US stocks on Thursday, 19 June 2014. US stocks rallied on Wednesday, 18 June 2014, gaining the most in four weeks, after the Federal Reserve chief signaled no hurry to raise rates.
The Federal Reserve said growth is bouncing back and the job market is improving as it continued to reduce the monthly pace of asset purchases. The Federal Open Market Committee trimmed bond-buying by $10 billion for a fifth straight meeting, to $35 billion, keeping it on pace to end the program late this year.
In a statement, the Federal Open Market Committee (FOMC) said that if the incoming information broadly supports the committee's expectation of ongoing improvement in US labor market conditions and inflation moving back toward its longer-run objective, the committee will likely reduce the pace of asset purchases in further measured steps at future meetings. However, asset purchases are not on a preset course, and the committee's decisions about their pace will remain contingent on the committee's outlook for the labor market and inflation as well as its assessment of the likely efficacy and costs of such purchases. To support continued progress toward maximum employment and price stability, a highly accommodative stance of monetary policy remains appropriate at this juncture, the FOMC said. The committee was of the view that it will be appropriate to maintain the current zero to 1/4 percent target range for the federal funds rate for a considerable time after the asset purchase program ends, especially if projected inflation continues to run below the committee's 2% longer-run goal, and provided that longer-term inflation expectations remain well anchored.
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