IT stocks led gains on the domestic bourses in what was a volatile trading session. The barometer index, the S&P BSE Sensex, attained record closing high. The 50-unit CNX Nifty hit record high on intraday basis as well as on closing basis. The Sensex garnered 121.53 points or 0.47%, up 146.93 points from the day's low and off 41.31 points from the day's high. Gains for the key benchmark indices were driven by upmove in Asian and European stocks. Asian and European stocks rose after better-than-expected inflation and housing reports in the US on Tuesday, 22 July 2014. However, the broad market lacked strength. The market breadth indicating the overall health of the market was negative. The BSE Small-Cap index was off 0.63%. The BSE Mid-Cap index was almost unchanged for the day.
IT stocks gained on positive economic data in US, the biggest outsourcing market for the Indian IT firms. TCS rose after the company announced a new partnership with MapR Technologies, Inc. PSU OMCs edged higher as crude oil prices declined. Hindalco Industries hit 52-week high as aluminum prices surged on London Metal Exchange (LME). Cement stocks declined. Bank stocks were mixed. Most auto stocks gained. Cement stocks declined.
The S&P BSE Sensex garnered 121.53 points or 0.47% to settle at 26,147.33, a record closing high. The index jumped 162.84 points at the day's high of 26,188.64 in morning trade. The index fell 25.40 points at the day's low of 26,000.40 in mid-afternoon trade.
The CNX Nifty garnered 27.90 points or 0.36% to settle at 7,795.75, a record closing high. The index hit a high of 7,809.20 in intraday trade, a lifetime high for the index. The index hit a low of 7,752.90 in intraday trade.
The total turnover on BSE amounted to Rs 3008 crore, lower than Rs 3029.89 crore on Tuesday, 22 July 2014.
The market breadth indicating the overall health of the market was negative. On BSE, 1,649 shares fell and 1,318 shares rose. A total of 98 hares were unchanged.
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The BSE Mid-Cap index rose 0.63 points or 0.01% to settle at 9,311.72. The BSE Small-Cap index shed 64.58 points or 0.63% to settle at 10,204.18. Both these indices underperformed the Sensex.
The S&P BSE IT index (up 2.24%) and the S&P BSE Teck index (up 1.74%) outperformed the Sensex.
The S&P BSE Consumer Durables index (up 0.37%), the S&P BSE Bankex (up 0.24%), the S&P BSE Auto index (up 0.19%), the S&P BSE Oil & Gas index (up 0.14%), the S&P BSE Capital Goods index (up 0.13%), the S&P BSE FMCG index (up 0.08%), the S&P BSE Realty index (down 0.05%), the S&P BSE Power index (down 0.14%), the S&P BSE Healthcare index (down 0.17%) and the S&P BSE Metal index (down 0.39%) underperformed the Sensex.
Among the 30-share Sensex pack, 16 stocks declined and rest of them rose.
IT stocks gained on positive economic data in US, the biggest outsourcing market for the Indian IT firms. Infosys (up 3.37%), Wipro (up 1.93%), Tech Mahindra (up 0.7%) and HCL Technologies (up 0.73%) gained.
TCS gained 2.09% to Rs 2,583.95 after hitting record high of Rs 2,595 in intraday trade. The company after market hours on Tuesday, 22 July 2014, announced a new partnership with MapR Technologies, Inc., provider of the top-ranked distribution for Apache Hadoop, to help enterprise customers easily and rapidly capture critical big data insights. The partnership's new big data offerings will shift the IT cost curve and allow companies to strategically reimagine their business models, TCS said. The announcement was made after market hours on Tuesday, 22 July 2014.
Polaris Financial Technology tumbled 7.62% after consolidated net profit fell 15.61% to Rs 38.32 crore on 7.04% decline in income from operations to Rs 600.03 crore in Q1 June 2014 over Q4 March 2014. The Q1 result was announced during market hours today, 23 July 2014.
KPIT Technologies slumped 11.34% after consolidated net profit fell 17.13% to Rs 50.80 crore on 1.5% decline in revenue to Rs 689.70 crore in Q1 June 2014 over Q4 March 2014. The Q1 result was announced after market hours on Tuesday, 22 July 2014. KPIT Technologies' EBITDA margin declined steeply to 12% in Q1 June 2014, from 16% in Q4 March 2014. The sharp decline in EBITDA margin was attributed to wage hikes effective 1 April which had a negative impact of 240 basis points (bps) on the EBITDA margin during the quarter. On a like to like basis, the average wage hikes were 4%-5% onsite and 9%-11% offshore. Some corrections and promotions will additionally take effect from 1 July and 1 October. The net impact on operational margins due to this would be around 0.5% in Q2 and Q3, KPIT Technologies said in a statement.
Tata Power Company dropped 1.29% as the stock turned ex-dividend today, 23 July 2014, for dividend of Rs 1.25 per share for the year ended 31 March 2014 (FY 2014).
Tata Power after trading hours on Tuesday, 22 July 2014, said that the Appellate Tribunal for Electricity (APTEL) in its interim order has directed procurer states to make electricity payments raised during and after March 2014 by Mundra ultra mega power project (UMPP) as per the compensatory tariffs directed by the Central Electricity Regulatory Commission (CERC) in February this year. Coastal Gujarat Power (CGPL) which operates the 4,000 megawatts (MW) Mundra project has to keep an account of the amount received from procurers as compensatory tariff until further notice. The next hearing of the matter is scheduled on 19 August 2014. CGPL is a subsidiary of Tata Power.
Tata Power said that CGPL has been delivering the full potential of Mundra across beneficiary states despite incurring losses. The company said that the indicative compensatory tariff of about Rs 2.80 per unit is much lower and very competitive compared to the average purchase price in all five states and is also substantially lower than the current market rate for providing replacement power at a cost upwards of Rs 4.10 per unit, which could leave all five states prone to load shedding. If Mundra UMPP were to be rendered unviable, the cost of purchasing replacement power would mean higher tariffs by at least Rs 1 per unit for all five states, Tata Power said.
Hindalco Industries gained 2.36% to Rs 192.70 after hitting a 52-week high of Rs 193.60 in intraday trade. The stock rose tracking rally in aluminum prices on the London Metal Exchange.
On the London Metal Exchange (LME), aluminum for three-month delivery advanced 1.63% to $2,020.50 a tonne on Tuesday, 22 July 2014. The price has risen 7.16% from a recent closing low of $1,885.50 on 10 July 2014.
The price has risen 9.19% so far in July 2014 (till 22 July 2014). It has risen 14.51% so far in calendar year 2014 (till 22 July 2014).
Most auto stocks gained. Ashok Leyland (up 1.05%), Mahindra & Mahindra (M&M) (up 1.58%), Hero MotoCorp (up 1.74%) and Bajaj Auto (up 1.62%) gained. Maruti Suzuki India (down 0.95%) and Tata Motors (down 0.36%), declined.
Bank stocks were mixed. Among PSU bank stocks, State Bank of India (SBI) (up 0.41%), Vijaya Bank (up 0.7%) and Bank of India (up 1.16%) gained. Punjab National Bank (down 0.23%), Canara Bank (down 0.35%) and Union Bank of India (down 0.15%) fell.
Bank of Baroda rose 2.9% after the Reserve Bank of India lifted curb on purchases of the shares of the bank by foreign investors. The Reserve Bank of India (RBI) on Tuesday, 22 July 2014, notified that the aggregate share holdings by foreign institutional investors (FIIs)/ registered foreign portfolio investors (FPIs)/non resident indian (NRI)/persons of Indian origin (PIO) under portfolio investment scheme in Bank of Baroda have gone below the prescribed threshold caution limit.
As on 30 June 2014, FIIs held 16.95% stake in Bank of Baroda.
Among private sector banks, ICICI Bank (up 1.44%) and Federal Bank (up 0.73%) gained. IndusInd Bank (down 0.51%), Kotak Mahindra Bank (down 0.9%) and HDFC Bank (down 0.46%) declined.
Yes Bank fell 1.83%. The bank during market hours reported 9.63% rise in net profit to Rs 439.48 crore on 9.33% rise in total income to Rs 3105.21 crore in Q1 June 2014 over Q1 June 2013.
Axis Bank shed 0.67% to Rs 2,004 in volatile trade after reporting good Q1 results. The stock hit high of Rs 2,042.95 and low of Rs 1,985.05. The bank after market hours on Tuesday, 22 July 2014, reported 18.29% rise in net profit to Rs 1666.76 crore on 10.17% rise in total income to Rs 9980.47 crore in Q1 June 2014 over Q1 June 2013.
Axis Bank's gross non-performing assets (NPAs) were at 1.34% of gross advances as on 30 June 2014, higher than 1.22% as on 31 March 2014 and 1.1% as on 30 June 2013. Net NPAs were 0.44% of net advances as on 30 June 2014, higher than 0.4% as on 31 March 2014 and 0.35% as on 30 June 2013.
ING Vysya Bank lost 3.13% after net profit declined 18.11% to Rs 143.40 crore on 4.77% growth in total income to Rs 1627.28 crore in Q1 June 2014 over Q1 June 2013. The Q1 result was announced after market hours on Tuesday, 22 July 2014.
ING Vysya Bank's board of directors at its meeting held on Tuesday, 22 July 2014, proposed to seek approval of the shareholders of the bank through postal ballot to borrow such amount that the total amount of borrowings of the bank outstanding at any time shall not exceed Rs 20000 crore notwithstanding that the money to be borrowed together with the moneys already borrowed by the bank (apart from temporary loans obtained from the bank's bankers in the ordinary course of business), will exceed the aggregate of the paid-up capital of the bank and its free reserves as against the existing authorization to borrow upto four times of the aggregate of the paid-up capital and free reserves.
The bank also proposes to augment its capital either through a Tier I and/or Tier II debt issuance (which qualifies under Basel III requirement) or a combination of both in India rupees or equivalent foreign currency not exceeding Rs 700 crore through private placement of securities.
The Reserve Bank of India on Tuesday, 22 July 2014, said that it is expected that about 4 to 6 banks may be designated as domestic systemically important banks (D-SIBs) and that the RBI will disclose the names of the banks classified as D-SIBs in the month of August every year starting from 2015. For identifying D-SIBs, the RBI will use four indicators viz. size, interconnectedness, substitutability and complexity of the bank. Based on their systemic importance scores in ascending order, banks will be plotted into four different buckets and will be required to have additional Common Equity Tier 1 capital requirement ranging from 0.2% to 0.8% of risk weighted assets, depending upon the bucket they are plotted into. D-SIBs will also be subjected to differentiated supervisory requirements and higher intensity of supervision based on the risks they pose to the financial system, the RBI said a press release. Size is a more important measure of systemic importance than any other indicators and therefore, size indicator will be assigned more weight than the other indicators, the RBI said.
During the recent global financial crisis, it was observed that problems faced by certain large and highly interconnected financial institutions hampered the orderly functioning of the financial system, which in turn, negatively impacted the real economy. Government intervention was considered necessary in many jurisdictions to ensure financial stability. Cost of public sector intervention and consequential increase in moral hazard require that future regulatory policies should aim at reducing the probability of failure of systemically important banks (SIBs) and the impact of the failure of these banks, the RBI said. In October 2010, the Financial Stability Board (FSB) recommended that all member countries needed to have in place a framework to reduce risks attributable to systemically important financial institutions (SIFIs) in their jurisdictions.
ABB India lost 2.83%. The company's net profit rose 20% to Rs 48 crore on 3.69% growth in revenue to Rs 1794 crore in Q2 June 2014 over Q2 June 2013. The Q2 result was announced during market hours today, 23 July 2014. ABB India said that the top line during the quarter remained stable with encouraging growth mainly from short cycle business. The company maintains its policy of cash over revenue, ABB India said in a statement.
ABB India attributed the growth in bottom line during the quarter to higher focus on continuous localization, cost optimization and striking the right balance of risks and returns.
The company's order backlog stood at Rs 8083 crore as on 30 June 2014 as against Rs 8260 crore as on 30 June 2013. The order backlog position of the company has been steadily increasing over the last six months providing revenue visibility, ABB India said in a statement.
PSU OMCs edged higher as crude oil prices declined on Tuesday, 22 July 2014. Indian Oil Corporation (up 1.41%), BPCL (up 4.41%) and HPCL (up 2.99%) edged higher.
Brent crude oil futures for September delivery were up 32 cents or 0.3% at $107.65 a barrel in electronic trading today, 23 July 2014. The contract fell 35 cents to settle at $107.33 a barrel on Monday, 22 July 2014, as oil supplies remained unaffected by continuing violence in Iraq, Ukraine and Gaza.
Lower crude oil prices could reduce under-recoveries of state-run oil marketing companies (PSU OMCs) on domestic sale of diesel, LPG and kerosene at controlled prices. The government has adopted the policy of gradually increasing diesel prices to eliminate under recovery and deregulate the diesel prices. The government has already freed pricing of petrol.
Cement stocks declined. ACC (down 2.02%), Ambuja Cements (down 2.76%), Shree Cement (down 0.9%) and UltraTech Cement (down 2.77%) declined.
Grasim Industries was off 1.85%. Grasim has exposure to the cement sector through its subsidiary UltraTech Cement.
Cairn India rose 0.85% ahead of its Q1 results today, 23 July 2014.
Reliance Communications shed 0.15%. In clarification to media report indicating that IBM, Wipro and other companies are in race for Rs 1200 crore call centre deal with Reliance Communications, Reliance Communications after market hours said that it does not comment on media reports on routine and ongoing business negotiations which may or may not result in to any transaction.
L&T Finance Holdings fell 0.68%. L&T Finance Holdings after market hours reported net loss of Rs 5.57 crore in Q1 June 2014, higher than net loss of Rs 1.22 crore in Q1 June 2013. Income from operations fell 22.67% to Rs 8.97 crore in Q1 June 2014 over Q1 June 2013.
Jet Airways (India) rose 3.3%. Jet Airways (India) and Etihad Airways after market hours said that they have finalized a major strategy for Jet Airways (India) to return to profitability in three years, which includes long-term network, fleet and product developments to optimise Jet's domestic and international operations. Etihad Airways holds 24% stake in Jet Airways (India). To initiate the three-year turnaround plan, Jet Airways board and management team have already worked with auditors to clean up Jet's balance sheet and write down overvalued non-cash assets, Jet and Etihad said in a joint statement.
Under the new plan, focus areas for international operations include widening network with new services to markets such as Europe, China, Australia and South East Asia. The airline will also expand frequencies on its existing routes and sign additional codeshares.
Naresh Goyal, chairman of Jet Airways (India), said that the company will address challenges in the domestic market with a model that removes complexity in its fleet, product and brand.
MRF rose 7.27% after net profit rose 1.29% to Rs 230.22 crore on 9.71% increase in total income to Rs 3,357.03 crore in Q3 June 2014 over Q3 June 2013. The result was announced during trading hours today, 23 July 2014.
Atul jumped 14.15% after net profit surged 47.78% to Rs 59.78 crore on 25.22% growth in total income from operations to Rs 647.08 crore in Q1 June 2014 over Q1 June 2013. The Q1 result was announced during market hours today, 23 July 2014.
Key benchmark indices surged in early trade as firmness in Asian stocks and provisional data showing that foreign funds were net buyers of Indian stocks during the previous trading session boosted sentiment. A bout of volatility was witnessed as key benchmark indices pared gains soon after hitting fresh intraday high in morning trade. The 50-unit CNX Nifty pared gains after hitting record high. The Sensex trimmed gains after hitting its highest level in more than two weeks. Key benchmark indices further pared gains in mid-morning trade. Volatility continued as key benchmark indices recovered from lower level after erasing most of the intraday gains in mid-morning trade. Key benchmark indices once again trimmed gains after extending intraday gains in afternoon trade. Key benchmark indices regained positive zone after reversing intraday gains after a sudden slide in afternoon trade. Key benchmark indices extended gains in late trade.
Indian stocks gained for the seventh straight day today, 23 July 2014. From a recent low of 25,006.98 on 14 July 2014, the Sensex has risen 1,140.35 points or 4.56% in seven trading sessions. The Sensex has risen 733.55 points or 2.88% in this month so far (till 23 July 2014). The Sensex has gained 4,976.65 points or 23.5% in calendar year 2014 so far (till 23 July 2014). From a 52-week low of 17,448.71 on 28 August 2013, the Sensex has risen 8,698.62 points or 49.85%. From a record high of 26,190.44 on 8 July 2014, the Sensex is off 43.11 points or 0.16%.
The market sentiment was boosted by data showing that foreign funds were net buyers of Indian stocks on Tuesday, 22 July 2014. Foreign portfolio investors (FPIs) bought shares worth a net Rs 372.25 crore from the secondary equity markets on Tuesday, 22 July 2014, as per the data from the Securities & Exchange Board of India (Sebi).
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 60.09, compared with its close of 60.25 on Tuesday, 22 July 2014.
European stocks edged higher today, 23 July 2014, as risk aversion triggered by recent geopolitical tensions continued to ebb. Key benchmark indices in UK, France and Germany were up 0.3% to 0.61%.
The European Union (EU) agreed Tuesday, 22 July 2014, to expand a list of Russian entities and individuals subject to asset freezes and travel bans. The EU's latest sanctions against Russia come amid accusations that pro-Russian rebels shot down Malaysia Airlines flight MH17 in Ukraine on 17 July. All 298 people on the flight died after the downing of the jet. EU has reportedly threatened to expand the sanctions against Russia to include vast sectors of the Russian economy if Russia does not act swiftly to rein in rebels.
Russia's Ambassador to Malaysia, Lyudmila Vorobyeva, said on Tuesday, 22 July 2014, that Russia played no role in the attack and Ukrainian separatists don't have the required long-range anti-aircraft weapons.
Meanwhile, the US aviation regulator -- the Federal Aviation Administration -- on Tuesday, 22 July 2014, temporarily banned US flights to Tel Aviv after a rocket attack near Israel's main airport. As per reports, more than 600 Palestinians have been killed and over 4,000 wounded as fighting continues between Israel and Palestinian militants in Gaza Strip.
Most Asian stocks edged higher today, 23 July 2014, boosted by better-than-expected inflation and housing reports in the US. Key benchmark indices in Hong Kong, China, Singapore and Indonesia were up 0.14% to 0.8%. Key benchmark indices in Japan and South Korea were off 0.03% to 0.1%. The stock market in Taiwan was closed due to a typhoon.
Trading in US index futures indicated that the Dow could gain 29 points at the opening bell on Wednesday, 23 July 2014. US stocks closed modestly higher on Tuesday, 22 July 2014, boosted by better-than-expected inflation and housing reports as well as a flood of second-quarter earnings reports.
The US consumer price index increased 0.3% in June 2014 after a 0.4% gain in May 2014, figures from the Labor Department showed yesterday, 22 July 2014, in Washington. The data damped concerns that the US Federal Reserve will bring forward increase in interest rates.
Purchases of existing houses advanced 2.6% to a 5.04 million annual rate in June 2014, the National Association of Realtors reported.
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