Key benchmark indices extended initial gains to hit fresh intraday high in morning trade. The S&P BSE Sensex hit its highest level in nearly 5 weeks as US Federal Reserve Chairman Ben S. Bernanke's statement on Wednesday, 10 July 2013, that the world's biggest economy will continue to need stimulus boosted Asian stocks. The 50-unit CNX Nifty hit over 4-week high. The Sensex was up 347.37 points or 1.8%, up close to 175 points from the day's low and off about 20 points from the day's high. The market breadth, indicating the overall health of the market, was strong. All the shares from 30-share Sensex pack rose. All the thirteen sectoral indices on BSE were in the green.
Mining and metal stocks rose after global commodity prices rallied overnight. HDFC Bank extended intraday gain. Cairn India rose as US crude oil futures traded near the highest price in 15 months.
The market surged in early trade on firm Asian stocks. The market extended initial gains to hit fresh intraday high in morning trade. The Sensex hit its highest level in almost five weeks.
Bernanke said a speech in Cambridge, Massachusetts on Wednesday, 10 July 2013, that "highly accommodative" monetary policy will be needed for the "foreseeable future." Meanwhile, minutes of the Fed's June meeting showed that while "several members judged that a reduction in asset purchases would likely soon be warranted," many want to see further improvement in the labor market before reducing the central bank's $85 billion-a-month quantitative easing program.
The Fed currently buys $85 billion a month in government and mortgage bonds in an effort to keep interest rates low and stimulate economic growth. The Fed's bond-buying program which has flooded global markets with liquidity has helped support an array of assets, including equities in recent years. At a press conference following the June 18-19 meeting, Federal Reserve Chairman Ben Bernanke said the central bank could start reducing its $85 billion in monthly bond purchases later this year.
At 10:20 IST, the S&P BSE Sensex was up 347.37 points or 1.8% to 19,641.49. The index jumped 370.50 points at the day's high of 19,664.62 in morning trade, its highest level since 7 June 2013. The index gained 174.34 points at the day's low of 19,448.64 in opening trade.
The CNX Nifty was up 108.65 points or 1.87% to 5,925.35. The index hit a high of 5,931.60 in intraday trade, its highest level since 10 June 2013. The index hit a low of 5,887.95 in intraday trade.
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The market breadth, indicating the overall health of the market, was strong. On BSE, 902 shares rose and 235 shares fell. A total of 36 shares were unchanged.
All the shares from 30-share Sensex pack rose. Coal India (up 3.33%), L&T (up 2.99%) and Bharti Airtel (up 2.41%), edged higher.
HDFC Bank rose 2.14%, with the stock extending intraday gain.
Mining and metal stocks rose after global commodity prices rallied overnight. Sail (up 1.15%), Hindustan Zinc (up 1.42%), Jindal Steel & Power (up 1.3%), JSW Steel (up 1.74%), Sterlite Industries (up 2.27%), and Hindalco Industries (up 3.67%), edged higher.
Tata Steel rose 1.54%. Tata Steel said on Wednesday, 10 July 2013, its hot metal production rose 20% to 2.22 million tonnes in first quarter ended June 2013-14 (Q1 FY 2014) over Q1 FY 2013. The crude steel production rose 22% to 2.46 million tonnes in Q1 FY 2014 over Q1 FY 2013. Saleable Steel production was higher by 23% to 2.14 million tonnes in Q1 FY 2014 over Q1 FY 2013 and sales increased by 26% to 2.01 million tonnes in Q1 FY 2014 over Q1 FY 2013.
IndusInd Bank rose 1.88% on strong Q1 results. The bank's net profit rose 41.72% to Rs 334.84 crore on 22.14% rise in total income to Rs 2382.81 crore in Q1 June 2013 over Q1 June 2012. The bank announced Q1 results during market hours on Wednesday, 10 July 2013.
Cairn India rose 1.36% as US crude oil futures traded near the highest price in 15 months. US crude oil futures for August delivery were up 3 cents to $106.55 a barrel in electronic trade today, 11 July 2013. The contract climbed $2.99 to $106.52 on Wednesday, 10 July 2013, the highest close since 27 March 2012. Higher crude oil prices will result in higher realizations from crude sales for oil exploration firms like Cairn India.
Asian stocks rose on Thursday, 11 July 2013, after US Federal Reserve Chairman Ben S. Bernanke said on Wednesday, 10 July 2013, that the world's biggest economy will continue to need stimulus. Key benchmark indices in China, Hong Kong, Indonesia, Singapore, South Korea and Taiwan rose by 1.43% to 2.36%. Japan's Nikkei Average fell 0.45%.
The Bank of Japan refrained from adding to unprecedented monetary stimulus and raised its assessment of the economy, referring to a recovery for the first time since before a record 2011 earthquake. Governor Haruhiko Kuroda's board stuck with an April pledge to expand the monetary base by 60 to 70 trillion yen ($709 billion) per year, a statement released in Tokyo today showed. The bank maintained its April forecast that prices, excluding the effect of a planned sales tax increase, will rise 1.9% in the year starting April 2015. It trimmed some other forecasts for inflation and economic growth. The BOJ now sees inflation of 0.6% in the current fiscal year and 1.3% in the following 12 months. The central bank is chasing a target of 2 percent inflation, focusing on a gauge that excludes fresh food.
South Korea's central bank on Thursday left its policy interest rate unchanged at 2.5% amid low inflation, uncertainty over the Federal Reserve's bond purchases and China's economic slowdown.
Trading in US index futures indicated that the Dow could surge 143 points at the opening bell on Thursday, 11 July 2013. US stocks ended little changed on Wednesday as investors analyzed minutes from the Fed's last meeting for signs on when the central bank might slow the pace of stimulus efforts.
Meanwhile, Brazil's central bank late Wednesday, 10 July 2013, raised the country's benchmark interest rate to 8.5% from 8%, marking the third consecutive rate increase of a half-percentage point each.
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