Resumption of fall in global crude oil prices and data showing continuation of buying of Indian stocks by foreign funds boosted sentiments as key benchmark indices surged to record high. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit record high on intraday basis as well as on closing basis. The market breadth indicating the overall health of the market was positive. The Sensex garnered 131.22 points or 0.47% to settle at 28,177.88. The BSE Small-Cap index jumped 1.07%, outperforming the Sensex. World stocks fell on global economic growth concerns after the latest data showed a surprise contraction in Japan's GDP in Q3 September 2014.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 669.98 crore from secondary equity market during the previous trading session on Friday, 14 November 2014. Global crude oil prices dropped. Indian government's decision last month to decontrol diesel prices and a sharp decline in global crude oil prices recently will 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. Meanwhile, the latest data showed that India's merchandise exports dropped 5.04% at $26.09 billion in October 2014 over October 2013.
PSU Bank stocks gained across the board. State Bank of India (SBI) hit 52-week high, with the stock extending Friday's gains triggered by the bank's strong Q2 September 2014 results. IT stocks edged higher. PSU OMCs declined. Capital goods stocks rose. Cement stocks declined. Index heavyweight Reliance Industries (RIL) edged higher in volatile trade after the company's Canadian partner Niko Resources on Friday, 14 November 2014, said it is evaluating plans for its oil and gas assets in India. Tata Motors scaled record high after announcing Q2 September 2014 result. Shares of jewellery retailers rose.
After languishing in red until mid-afternoon trade, key benchmark indices bounced back during the latter part of the trading session.
In overseas markets, European stocks fell amid global economic growth concerns as Japan unexpectedly slipped into a recession. Japanese stocks led decline in Asian stocks after the latest data showed that Japan's GDP unexpectedly shrank in the third quarter.
In the foreign exchange market, the rupee edged lower against the dollar.
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Brent crude futures edged lower following news Japan, the world's fourth-biggest crude importer, had slipped into recession and after comments from the West's energy watchdog that a return to high oil prices was unlikely soon.
The S&P BSE Sensex advanced 131.22 points or 0.47% to settle at 28,177.88, a record closing high for the index. The index jumped 159.05 points at the day's high of 28,205.71 in late trade, a lifetime high for the index. The index lost 125.32 points at the day's low of 27,921.34 in early afternoon trade.
The CNX Nifty rose 40.85 points or 0.49% to settle at 8,430.75, a record closing high for the index. The index hit a high of 8,438.10 in intraday trade, a lifetime high for the index. The index hit a low of 8,349.10 in intraday trade.
The BSE Mid-Cap index advanced 92.89 points or 0.91% to settle at 10,247.70. The BSE Small-Cap index rose 120.57 points or 1.07% to settle at 11,337.96. Both these indices outperformed the Sensex.
The market breadth indicating the overall health of the market was positive. On BSE, 1,622 shares advance and 1,441 shares declined. A total of 83 shares were unchanged.
Among sectoral indices on BSE, the S&P BSE Auto index (up 1.43%), BSE Consumer Durables index (up 0.91%), BSE Oil & Gas index (up 0.83%), and BSE Power index (up 1.54%) outperformed the Sensex.
The S&P BSE Bankex index (up 0.41%), BSE Capital Goods index (up 0.19%), BSE FMCG index (up 0.2%), BSE Healthcare index (down 0.15%), BSE IT index (up 0.29%), BSE Metal index (down 0.55%), BSE Realty index (up 0.33%) and BSE Teck index (up 0.45%) underperformed the Sensex.
ONGC rose 0.83% at Rs 396.60. The stock hit a high of Rs 399 and a low of Rs 392.65. The company's profit after tax (PAT) declined 10.2% to Rs 5445 crore on 8.8% decline in gross revenue to Rs 20512 crore in Q2 September 2014 over Q2 September 2013. ONCG attributed the decline in PAT to lower crude oil price. ONGC offered a gross discount of Rs 13641 crore in Q2 September 2014 to public sector oil marketing companies on sale of crude oil, PDS kerosene and domestic LPG based on the rates of discount communicated by the Ministry of Petroleum & Natural Gas. This was lower than gross discount of Rs 13796 crore in Q2 September 2013. ONGC's profit after tax was reduced by Rs 7645 crore in Q2 September 2014 due to discount on product sales to PSU OMCs. This was higher than an adverse impact on profit after tax to the extent of Rs 7621 crore in Q2 September 2013. ONGC's crude oil production rose 2.1% to 5.21 MMT in Q2 September 2014 over Q2 September 2013. ONGC announced the second quarter results after trading hours on Friday, 14 November 2014.
At the time of announcement of Q2 September 2014 results, the board of directors of ONGC approved two major investment decisions valued over Rs 10600 crore for further enhancing production from ONGC's Western Offshore fields. The Redevelopment (Phase-III) of ONGC's giant offshore field Mumbai High (South) involves a capital investment of Rs 6069 crore. The implementation of the project will lead to incremental gain of 7.547 million tonne (MMT) crude oil and 3.864 billion cubic meter (BCM) gas by 2030, ONGC said. This project is designed to carry forward the success of the previous two phases of redevelopment project and give a new lease of life to the giant field, ONGC said in a statement.
The second project viz. the Integrated Development of Mukta, Bassein and Panna Formations involves an estimated capital expenditure of Rs 4620 crore. This project is designed to carry forward the success of the previous two phases of redevelopment, ONGC said. The incremental production is expected to start in 2014-15 with peak incremental production rate of 10 MMSCMD of gas, 950 barrels of oil and about 1,100 cubic meters of condensate per day by 2017-18. The cumulative production till 2027-28 is pegged at 19.56 BCM of Gas, 1.97 million cubic meter of Condensate and 1.83 MMT of Oil.
At the time of announcement of Q2 September 2014, ONGC notified two more hydrocarbon discoveries; one new Prospect (GKS092NAA-1 (NELP block GK-OSN-2009/2) at Kutch Offshore shallow water) and one New Pool discovery at well RSAK (R-184) in Rudrasagar ML Block, North Assam Shelf, A&AA Basin. With this, ONGC notified total 10 discoveries (5 new Prospects and 5 new Pools) so far in this fiscal year.
Index heavyweight Reliance Industries (RIL) rose 1.47% to Rs 983.35. The stock was volatile. The stock hit high of Rs 985 and low of Rs 966.95. Canada's Niko Resources on Friday, 14 November 2014, said it is evaluating plans for its oil and gas assets in India. There is uncertainty around the long-term natural gas price outlook in India and as a result, the company is evaluating its plans for its assets in India, Niko Resources said at the time of announcement of its Q2 September 2014 results. RIL is the operator of the D6 Block, off the eastern coast of India with 60% stake. Niko owns 10% and BP Plc has a 30% stake in the block.
In October 2014, the Government of India announced its new domestic gas pricing policy effective 1 November 2014. The announced price for the period from November 2014 to March 2015 is a 33% increase over the price received previously and the company expects to receive a cash benefit of $4 million over this period related to gas sales from the MA field in the D6 Block in India, Niko Resources said in a statement. The new gas pricing guidelines indicate that for all discoveries after the issuance of these guidelines, in Ultra Deep Water Areas, Deep Water Areas and High Pressure-High Temperature areas, a premium would be given on the gas price determined as per the formula defined in the guidelines, with the premium to be determined as per prescribed procedure. The applicability of the premium to existing undeveloped discoveries in the D6 and NEC-25 blocks, such as the discoveries included in the approved plans of development for the R-Cluster and Satellite Areas, remains to be clarified, Niko Resources said. The development of these discoveries is dependent on the future long-term price outlook for gas sales from these projects and the uncertainty in this outlook could mean that the development of these reserves could be deferred and/or material reductions in the company's reported reserves or future net revenues could result, Niko Resources said.
Tata Motors gained 4.07% to Rs 545.10 after scaling a record high of Rs 547.35 in intraday trade. Tata Motors' consolidated net profit declined 7.1% to Rs 3291 crore on 6.5% growth in revenue (net of excise) to Rs 60564 crore in Q2 September 2014 over Q2 September 2013. The result was announced after market hours on Friday, 14 November 2014.
Tata Motors said that revenue rose as continuing weak operating environment in the standalone business was more than offset by increase in wholesale volumes, richer product mix and market mix at its British luxury care unit Jaguar Land Rover (JLR). JLR's net profit declined 11.24% to GBP 450 million on 4.2% growth in revenue at GBP 4808 million in Q2 September 2014 over Q2 September 2013. JLR's profit before tax (PBT) fell 8.8% to GBP 609 million in Q2 September 2014 over Q2 September 2013. The decline in PBT was due to unfavourable revaluation of foreign currency debt and unrealised hedges and higher depreciation and amortisation, Tata Motors said. JLR's earnings before interest, taxation, depreciation and amortization (EBITDA) rose 15.3% to GBP 933 million in Q2 September 2014 over Q2 September 2013. Continued strong revenue and operating performance were driven by wholesale volume increase, richer product mix supported by the ongoing success of Ranger Rover Sport, Range Rover and Jaguar F-TYPE, robust market mix with strong sales in emerging markets, Tata Motors said in a statement.
Ashok Leyland rose 1.47% at Rs 55.30. The company today, 17 November 2014, said it has bagged two large integrated transport projects in Tanzania and Zimbabwe, together worth $79.2 million. Besides the supply of trucks, buses, LCVs, spares and allied support services (includes training and developmental consultancy), these projects will address a variety of mobility requirements in various tourism and economic development programs. Exim Bank has financed these projects under their NEIA scheme, that supports project exports from India, Ashok Leyland said.
PSU bank stocks gained across the board. Punjab National Bank (up 2.65%), Bank of India (up 1.17%), Bank of Baroda (up 4.02%), Union Bank of India (up 1.59%), Allahabad Bank (up 0.84%) and Canara Bank (up 1.77%) gained.
State Bank of India (SBI) edged higher with the stock extending Friday's gains triggered by the bank's strong Q2 September 2014 results. The stock jumped 5.44% at Rs 2,940.15. The stock hit 52-week high of Rs 2,950 in intraday trade. SBI's net profit jumped 30.54% to Rs 3100.41 crore on 12.46% increase in total income to Rs 41833.36 crore in Q2 September 2014 over Q2 September 2013. The bank announced the results during trading hours on Friday 14 November 2014.
HDFC Bank declined 1.05% at Rs 919.55. The stock hit high of Rs 940 and a low of Rs 909. As per media reports, the foreign investment promotion board (FIPB) has approved the bank's revised proposal to increase foreign investment ceiling in the bank to 74% from 49%. Currently, the Reserve Bank of India has put a ban on further purchases of shares of HDFC Bank by foreign institutional investors (FIIs). The RBI had on 16 December 2013 notified that foreign shareholding through FIIs/Non Resident Indian (NRI)/persons of Indian Origin (PIO)/Foreign Direct Investment (FDI)/Asset Development Reserve (ADR)/Global Depository Receipt (GDR) in HDFC Bank had crossed the overall limit of 49% of the bank's paid-up capital. Therefore, no further purchases of shares of this bank would be allowed through stock exchanges in India on behalf of FII/NRI/PIO/FDI/ADR/GDRs, the RBI had said at that time.
Sun Pharmaceuticals Industries shed 0.46% at Rs 882.45. In clarification to reports titled Sun Pharma Merck Call Off 3-year-old JV, Sun Pharmaceuticals Industries during market hours today, 17 November 2014, clarified that there is no termination of joint venture (JV) of Sun Pharma with Merck (MSD).
Shares of biscuits major Britannia Industries gained 1.31% to Rs 1,646.45 after scaling a record high of Rs 1,705 in intraday trade. On a consolidated basis, the company's net profit jumped 177% to Rs 270.46 crore on 22.3% rise in total income to Rs 2152.85 crore in Q2 September 2014 over Q2 September 2013. The result was announced after market hours on Friday, 14 November 2014.
Shares of JSW Energy and Jaiprakash Power Ventures, both, edged higher after the two companies yesterday, 16 November 2014, announced that JSW Energy has agreed to acquire from Jaiprakash Power Ventures and other shareholders, 100% stake in Himachal Baspa Power Company for a base Enterprise Value of approximately Rs 9700 crore. JSW Energy surged 12.13% at Rs 85.05. Shares of Jaiprakash Power Ventures rose 2.71% at Rs 14.76.
The board of directors of Jaiprakash Power Ventures has approved the transfer of the 300 megawatts (MW) Baspa II hydro electric project located at Himachal Pradesh and the 1,091 MW Karcham Wangtoo hydro electric project located at Himachal Pradesh into a separate company, i.e. the Himachal Baspa Power Company (Target), as a going concern through a scheme of arrangement. Subsequent to the scheme of arrangement being made effective and subject to other terms and conditions agreed between JSW Energy and Jaiprakash Power Ventures, JSW Energy proposes to acquire 100% of the securities of the Target held by Jaiprakash Power Ventures.
Post acquisition, the aggregate installed and operational power generation capacity of JSW Energy will enhance to 4,531 MW. The acquisition takes JSW Energy one step closer in achieving its aim of having 12,000 MWs power generation by 2025. Considering the operational track record of the projects with fairly stable hydrology, the acquisition will yield immediate cash flow and is expected to enhance JSW Energy's consolidated profits and returns and create significant synergies, JSW Energy said.
Tata Coffee surged 4.75% at Rs 967.85 after the company said that a meeting of the Board of Directors will be held on 25 November 2014 to consider the proposal of stock split of the equity shares. The announcement was made during trading hours today, 17 November 2014.
Capital goods stocks were mostly higher. Alstom T&D India (up 3.36%), Crompton Greaves (up 1.89%), and Thermax (up 0.88%) gained.
Bharat Heavy Electricals (Bhel) rose 1.2% at Rs 249.15. The stock was volatile. The stock hit high of Rs 250.45 and low of Rs 240.50. Bhel during market hours today, 17 November 2014, said that the company has successfully commissioned the second module of the 2x363.3 megawatt (MW) gas-based Combined Cycle Power Plant (CCPP) of ONGC Thermal Power Corporation (OTPC) in Tripura.
BEML lost 3.76% at Rs 700.80. The company reported net loss of Rs 55.14 crore in Q2 September 2014, higher than net loss of Rs 38.88 crore in Q2 September 2013. Total income fell 39.48% to Rs 458.78 crore in Q2 September 2014 over Q2 September 2013. The result was announced after market hours on Friday, 14 November 2014.
Adani Enterprises rose 1.44% at Rs 495.70 on reports the company has signed a memorandum of understanding for a loan of up to $1 billion from State Bank of India (SBI) for a mine, rail and port project in Queensland, Australia which it aims to build by end-2017.
Cement stocks declined. Ambuja Cements (down 0.98%), ACC (down 0.67%), UltraTech Cement (down 2.35%) edged lower. Shree Cement (up 1.36%) gained.
Grasim Industries lost 0.35% at Rs 3,563. Grasim has exposure to the cement sector through its subsidiary UltraTech Cement.
IT stocks edged higher. MindTree (up 1.41%), Infosys (up 0.49%), TCS (up 0.48%), Oracle Financial Services Software Services (up 0.35%), and Wipro (up 0.08%) gaind.
Tech Mahindra lost 1.73% at Rs 2,595.60. The company after market hours on Friday, 14 November 2014, said it has joined forces with The Open University and Milton Keynes Council in leading the charge in the UK's Smart Cities revolution. At a special ceremony, top representatives from the OU and Council were joined in Milton Keynes by the CEO of Tech Mahindra to sign agreements which will see the parties work closely together in researching key areas behind Smart Cities. This makes Tech Mahindra one of the first Indian IT companies to work on integrated solutions across connected ecosystem for Smart Cities in the UK.
HCL Technologies rose 0.59% at Rs 1,620. In clarification to news item captioned HCL takes on IBM in Europe, HCL Technologies during market hours today, 17 November 2014, clarified that there is no news that has been announced. The item being referred to is an interpretation of the journalist and has no material impact or price sensitivity associated with it, HCL Tech said.
Shares of the two state-run power finance companies surged. Rural Electrification Corporation (REC) rose 10.25% to Rs 335.70.
Power Finance Corporation (PFC) advanced 7.42% at Rs 301.75.
PSU OMCs edged lower. BPCL (down 1.22%) and HPCL (down 1.12%) declined. Indian Oil Corporation (up 0.2%) advanced.
Jewellery stocks advanced. Shree Ganesh Jewellery House (up 0.19%), Tara Jewels (up 2.26%), Tribhovandas Bhimji Zaveri (up 1.64%), Thangamayil Jewellery (up 4.11%), Titan Company (up 0.65%) and PC Jeweller (up 0.02%) edged higher. Gitanjali Gems (down 0.17%) and Rajesh Exports (down 1.34%) declined.
A news agency today, 17 November 2014, quoted Reserve Bank of India (RBI) Deputy Governor S.S. Mundra as saying that the RBI is in talks with the government for a decision on increasing curbs on gold imports. Mundra said attention needed to be paid to the surge in gold imports.
The Sensex has risen 237.24 points or 0.84% in two trading sessions from a recent low of 27,940.64 on 13 November 2014. The Sensex has risen 312.05 points or 1.11% in this month so far (till 17 November 2014). The Sensex has gained 7,007.20 points or 33.09% in calendar year 2014 so far (till 17 November 2014). From a 52-week low of 19,963.12 on 4 February 2014, the Sensex has risen 8,214.76 points or 41.14%.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 61.7475, compared with its close of 61.725 during the previous trading session on Friday, 14 November 2014.
India's merchandise exports dropped 5.04% at $26.09 billion in October 2014 over October 2013, data released by the government today, 17 November 2014, showed. Imports rose 3.62% to $39.45 billion in October 2014 over October 2013. Oil imports declined 19.2% at $12.36 billion in October 2014 over October 2013. Non-oil imports jumped 18.9% to $27.09 billion in October 2014 over October 2013. The trade deficit surged to $13.36 billion in October 2014, from $10.59 billion in October 2013.
Brent crude futures edged lower following news Japan, the world's fourth-biggest crude importer, had slipped into recession and after comments from the West's energy watchdog that a return to high oil prices was unlikely soon. Brent for January settlement was off 86 cents at $78.55 a barrel. The contract had edged higher during the previous trading session on Friday, 14 November 2014, amid speculation that OPEC may cut its oil production, a move that would help stabilize plunging prices. Brent for January settlement had risen $1.92 a barrel to settle at $79.41 on Friday, 14 November 2014.
The International Energy Agency (IEA) said in its monthly report which was released on Friday, 14 November 2014, that the oil market had entered a new era with lower Chinese economic growth and booming US shale output, making a quick return to high prices unlikely. The IEA said prices could fall further in 2015 after dropping below $80 a barrel for the first time since 2010.
Oil ministers from the Organization of the Petroleum Exporting Countries (OPEC) are scheduled to meet in Vienna on 27 November 2014 to consider whether to adjust their output target of 30 million barrels per day (bpd) for early 2015.
On 13 November 2014, the Indian government announced increase in excise duty on petrol and diesel by Rs 1.50 per litre each. The hike in excise duty on the two transportation fuels will help boost government's revenue. The government's decision last month to decontrol diesel prices and a sharp decline in global crude oil prices recently would 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. However, a weakness in rupee against the dollar will restrict the benefit of falling global crude oil prices to that extent. A weak rupee raises the cost of imports.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 2 December 2014. The central bank aims to limit consumer-price gains to 8% by January 2015 and 6% by January 2016. Over the longer term, the RBI aims to limit consumer-price gains to 4%, within a 2% band. The annual rate of inflation based on the combined consumer price index (CPI) for urban and rural India eased to 5.52% in October 2014 from 6.46% in September 2014, data released by the government on 12 November 2014 showed.
European stocks fell today, 17 November 2014, amid global economic growth concerns as Japan unexpectedly slipped into a recession. Key benchmark indices in UK, France and Germany were off 0.27% to 0.4%.
Japanese stocks led decline in Asian stocks today, 17 November 2014, after the latest data showed that Japan's GDP unexpectedly shrank in the third quarter. Key benchmark indices in Singapore, Taiwan, Japan and South Korea were off 0.08% to 2.96%. In Indonesia, the Jakarta Composite index was up 0.09%.
Japan's real GDP shrank 1.6% on an annualized basis in July-September third quarter as firms cut inventories and held back on capital investment. The figure marked the second quarter of contraction, after the economy shrank 7.3% in the April-June second quarter after the national sales tax ticked up to 8% from 5% on 1 April 2014.
In mainland China, the Shanghai Composite index was off 0.19%. In Hong Kong, the Hang Seng was off 1.21%. A trading program linking Hong Kong's stock market with Shanghai began today, 17 November 2014. For the first time, the pilot program allows eligible mainland investors to trade stocks listed on the Stock Exchange of Hong Kong (SEHK) directly through the Shanghai Stock Exchange (SSE). At the same time, it allows Hong Kong and overseas investors to trade stocks listed on the SSE directly through the SEHK, also for the first time. China will waive capital gains tax for foreign investors buying mainland through the Connect, according to statement released by the Finance Ministry last week.
China's banks reported the biggest jump in bad loans last quarter since 2005. Nonperforming loans rose 72.5 billion yuan ($11.8 billion) from the previous quarter to 766.9 billion yuan, the China Banking Regulatory Commission said in a statement on Saturday, 15 November 2014. Soured credit accounted for 1.16% of lending, up from 1.08% three months earlier.
Trading in US index futures indicated that the Dow could fall 35 points at the opening bell today, 17 November 2014. US stocks ended Friday's uneven trading session fractionally higher. The main benchmarks switched between small gains and losses throughout the trading session, as investor reaction to upbeat economic data, namely retail sales and consumer confidence, was mostly muted.
Sales at US retailers rose in October, snapping back from the first decline in eight months as gasoline prices continued to plunge, data showed on Friday, 14 November 2014. The uptick in spending last month, especially when gasoline is stripped out, suggests households could be prepared to spend more during the holiday season than they have in years. The prices paid for imported goods fell in October, largely due to plunging global oil prices, the US Labor Department said Friday, 14 November 2014. The preliminary November reading on the University of Michigan/Thomson Reuters consumer-sentiment index rose to the highest level since July 2007.
Leaders from the G 20 group of nations agreed on Sunday, 16 November 2014, to boost flagging global growth, tackle climate change and crack down on tax avoidance but ties between the West and Russia plummeted to a new low over the crisis in Ukraine. Group of 20 leaders agreed to take measures that would boost their economies by a collective $2 trillion by 2018 as they battle patchy growth and the threat of a European recession. Citing risks from financial markets and geopolitical tensions, the leaders said the global economy is being held back by lackluster demand, according to their communiqufollowing a two-day summit that ended yesterday, 16 November 2014, in Brisbane. The group submitted almost 1,000 individual policy changes designed to lift growth and said they would hold each other to account to ensure they are implemented.
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