Miniscule gains pushed key benchmark indices to record closing high. Benchmark indices recovered in late trade after languishing in negative zone for most of the trading session. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, scaled lifetime high on intraday basis as well as on closing basis. The Sensex rose 3.48 points or 0.01%, up 236.36 points from the day's low and off 127.42 points from the day's high. The market breadth indicating the overall health of the market was positive.
Indian stocks gained for the fourth day in a row today, 10 June 2014. The Sensex has risen 777.86 points or 3.13% in four trading days from recent low of 24,805.83 on 4 June 2014. The Sensex has risen 1,366.35 points or 5.64% in June so far (till 10 June 2014). The Sensex has gained 4,413.01 points or 20.84% in calendar year 2014 so far (till 10 June 2014). From a 52-week low of 17,448.71 on 28 August 2013, the Sensex has risen 8,134.98 points or 46.62%.
Coming back to today's trade, IT stocks extended Monday's gains triggered by strong US job data for May 2014. Tech Mahindra hit 52-week high. Realty stocks edged lower on profit booking after recent strong gains. Shares of Essar group companies surged. Bank stocks edged lower. Shares of power generation firms dropped. Coal India extended Monday's gains triggered by the government's announcement that it will formulate clear rules for allocation of coal, minerals and telecoms spectrum. Shares of two-wheeler makers declined on worries below normal monsoon rains this year will impact rural demand for two-wheelers. Metal and mining stocks declined.
A bout of volatility was witnessed as key benchmark indices slipped into the red after opening higher. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, slipped into the red after scaling record high in opening trade. Volatility continued as key benchmark indices trimmed losses after hitting fresh intraday low in morning trade. The Sensex languished in the negative terrain in mid-morning trade. The Sensex trimmed losses in early afternoon trade. Intraday recovery continued as key benchmark indices further trimmed intraday losses in afternoon trade. Intraday recovery proved short lived as key benchmark indices once again weakened in mid-afternoon trade. Recovery in European stocks helped recovery on the domestic bourses in late trade.
The S&P BSE Sensex rose 3.48 points or 0.01% to settle at 25,583.69, a record closing high for the index. The index fell 232.88 points at the day's low of 25,347.33 in morning trade, its lowest level since 6 June 2014. The index rose 130.90 points at the day's high of 25,711.11 in early trade, a lifetime high for the index.
The CNX Nifty rose 1.80 points or 0.2% to settle at 7,656.40, a record closing high for the index. The index hit a low of 7,579.30 in intraday trade, its lowest level since 6 June 2014. The index hit a high of 7,683.20 in intraday trade, a lifetime high for the index.
The BSE Mid-Cap index shed 25.30 points or 0.27% to settle at 9,211.85, underperforming the Sensex. The BSE Small-Cap index garnered 26.39 points or 0.26% to settle at 10,017.44, outperforming the Sensex.
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The total turnover on BSE amounted to Rs 4665 crore, lower than Rs 4884.72 crore on Monday, 9 June 2014.
The market breadth indicating the overall health of the market was positive. On BSE, 1,834 shares gained and 1,272 shares declined. A total of 88 shares were unchanged.
The S&P BSE Consumer Durables index (up 3.55%), the S&P BSE IT index (up 2.32%), the S&P BSE Teck index (up 1.98%), the S&P BSE Healthcare index (up 1.97%), the S&P BSE FMCG index (up 0.12%), the S&P BSE Auto index (up 0.02%) outperformed the Sensex.
The S&P BSE Bankex (down 0.76%), the S&P BSE Metal index (down 0.85%), the S&P BSE Power index (down 0.86%), the S&P BSE Capital Goods index (down 0.9%), the S&P BSE Oil & Gas index (down 0.96%) and the S&P BSE Realty index (down 2.96%) underperformed the Sensex.
Among the 30-share Sensex pack, 16 stocks declined and rest of them gained.
Sun Pharmaceutical Industries rose 1.27% to Rs 608.90. A foreign brokerage house reiterated its overweight rating on the Sun Pharmaceutical Industries stock and raised its target price to Rs 717 from Rs 646 after analyzing multiple EPS scenarios for year ending 31 March 2015 (FY 2015) and FY 2016, which hinge on Ranbaxy's FTFs (first-to-file) (Nexium and Diovan). According to the report, launch of these FTFs should boost Ranbaxy's cash balance by $290 million (translating to Rs 7.20 a share). The brokerage house remains confident in Sun Pharmaceutical Industries' current business segments for which it forecasts a 3-year revenue CAGR of 17% despite the high base of FY 2014.
Coal India extended Monday's gains triggered by the government's announcement that it will formulate clear rules for allocation of coal, minerals and telecoms spectrum. The stock was up 1.61% at Rs 419.55. Reforms in the coal sector will be pursued with urgency for attracting private investment in a transparent manner, President Pranab Mukherjee said in his speech addressing a joint sitting of Parliament on Monday, 9 June 2014.
Shares of power generation firms dropped. NHPC (down 0.35% to Rs 28.10), Tata Power Company (down 1.14% to Rs 112.40), GVK Power & Infrastructure (down 5.38% to Rs 19.35), Adani Power (down 1.71% to Rs 63.25), CESC (down 1.34% to Rs 619), JSW Energy (down 3.25% to Rs 80.50) and Reliance Power (down 1.66% to Rs 109.45) declined. Reliance Infrastructure rose 0.45% to Rs 811.85.
Bank stocks were mostly lower. Among PSU banks, Union Bank of India (down 4.3% at Rs 243.55), Oriental Bank of Commerce (down 3.01% at Rs 354), Canara Bank (down 2.52% at Rs 480.95), Bank of India (down 2.24% at Rs 321.50), Bank of Baroda (down 1.98% at Rs 886.95), Punjab National Bank (down 2.11% at Rs 999.75) and State Bank of India (down 1.69% at Rs 2,657.75) edged lower.
Among private sector banks, ING Vysya Bank (down 2.41% at Rs 636), Yes Bank (down 1.21% at Rs 562.40), Axis Bank (down 1.26% at Rs 1,941.40), ICICI Bank (down 0.38% at Rs 1,481) and HDFC Bank (down 0.72% at Rs 814.15) edged lower.
HDFC rose 0.69% to Rs 952 after hitting record high of Rs 970 in intraday trade.
Bharat Heavy Electricals lost 3.1% to Rs 255, with the stock sliding on profit booking after recent rally. Bhel had rallied 8.67% in six trading sessions to settle at Rs 263.15 on Monday, 9 June 2014, from a recent low of Rs 242.15 on 30 May 2014.
Bhel after market hours on Monday, 9 June 2014, said that Union Minister for Heavy Industries & Public Enterprises Anant Geete visited the company's corporate office at Siri Fort, New Delhi on Monday, 9 June 2014. The Minister was briefed about the performance trends of the company, its diversification plans, manufacturing and R&D capability with respect to new initiatives and strategies for growth, among others, Bhel said. The Minister, while appreciating the progress made by the company in different areas, asked Bhel to gear up for the future to face competition from the domestic as well as overseas companies, Bhel said.
Appreciating the inherent strength of Bhel, he said that the company had the resilience to get into business areas that are long gestation in nature and where profits can be begin to materialize over a period of time. He assured the Bhel management of complete support and backing of the Ministry of Heavy Industries & Public Enterprises. In view of the slowdown in the power sector, the Minister directed the company to step up its activities in other areas like renewables (including solar), transportation, transmission and defence, in a big way, Bhel said in a statement.
Metal and mining stocks declined. NMDC (down 0.99% to Rs 189.50), Sesa Sterlite (down 2.39% to Rs 300.20), Jindal Steel & Power (down 1.5% to Rs 335.05), National Aluminium Company (down 0.98% to Rs 55.60), Tata Steel (down 2.63% to Rs 558.60), Steel Authority of India (Sail) (down 2.32% to Rs 107.60), Hindustan Zinc (down 2.82% to Rs 169.30) edged lower. Hindustan Copper (up 6.06% to Rs 119.80), JSW Steel (up 0.41% to Rs 1,308.40) and Hindalco Industries (up 0.15% to Rs 169.30) gained.
IT stocks extended Monday's gains triggered by strong US job data for May 2014. US is the biggest outsourcing market for the Indian IT firms. Infosys (up 2.73% to Rs 3,067.20), Wipro (up 2.72% to Rs 524), TCS (up 1.98% to Rs 2,119.90) and HCL Technologies (up 1.77% to Rs 1,390.50) gained.
Tech Mahindra rose 2.52% to Rs 2,005.35 after hitting 52-wek high of Rs 2,025 in intraday trade.
Geometric rose 3.11%. Geometric today, 10 June 2014, announced that it has signed an application maintenance contract with Volvo Cars, Sweden covering major applications from computer aided design (CAD) and product lifecycle management (PLM) landscape. The announcement was made during market hours today, 10 June 2014. Geometric has been partnering with Volvo Cars for Volvo's global engineering and manufacturing needs since 2010, Geometric said.
On signing the contract, Nitin Tappe, COO, Geometric said: "We have a long standing relationship with Volvo, and work with them on several strategic projects. This contract is a testament to our commitment to deliver the best, and Volvo's trust in our ability to consistently bring innovation to their CAD and PLM applications. We look forward to continuing to contribute to Volvo Cars success in the use of PLM and CAD technologies".
UltraTech Cement rose marginally by 0.04% to Rs 2,799. Jaiprakash Associates rose 2.57% to Rs 87.80. With respect to news article titled UltraTech Cement to buy Jaiprakash Associates' Rewa cement plants, UltraTech Cement after market today, 10 June 2014, said that the company does not comment on market speculation. Media reports said that UltraTech Cement is in talks to buy cement assets from Jaiprakash Associates, including Jaiprakash's Rewa cement-making complex in central India. Jaiprakash's Rewa cement-making complex has an annual capacity of 7 million tonnes. UltraTech last year agreed to buy a Jaiprakash cement unit based in Gujarat.
Shares of two-wheeler makers declined on worries below normal monsoon rains this year will impact rural demand for two-wheelers.
Bajaj Auto fell 0.53% to Rs 2,145, with the stock reversing direction after hitting 52-week high of Rs 2,207.20 in intraday trade.
Hero MotoCorp (down 2.38%) and TVS Motor Company (down 0.72%) declined.
Idea Cellular declined 1.33% to Rs 144.50. The company before trading hours today, 10 June 2014, said that the Securities Allotment Committee of the Board of Directors of the bank at its meeting held on Monday, 9 June 2014, decided to close the issue and approved the issuance of 22.38 crore shares to qualified institutional buyers (the QIBs) at an issue price of Rs 134 per share, including a premium of Rs 124 per share, aggregating approximately to Rs 3000 crore. The issue had opened for bidding on 5 June 2014.
Shares of public sector oil marketing companies (PSU OMCs) edged lower as crude oil prices rose. HPCL (down 2.89% at Rs 431.50), Indian Oil Corporation (down 2.26% at Rs 358.65) and BPCL (down 0.56% to Rs 611.10) edged lower. Increase in crude prices could raise under-recovery of PSU OMCs on domestic sale of diesel, LPG and kerosene at government controlled prices. The government has already freed petrol pricing.
Brent for July settlement was 3 cents lower at $109.96 a barrel on the London-based ICE Futures Europe exchange ahead of the weekly inventory data from the American Petroleum Institute, a US trade body, due later during the global day. The US is the world's biggest oil consumer. Brent rose by $1.38 a barrel to settle at $109.99 on Monday, 9 June 2014, as strong Chinese and US data pointed to healthy economic growth and higher demand for oil from the world's top two consumers.
Realty stocks edged lower on profit booking after recent strong gains. DLF (down 3.52% to Rs 232.80), Sobha Developers (down 5.83% to Rs 526), Housing Development and Infrastructure (HDIL) (down 2.77% to Rs 108.80) and Unitech (down 3.97% to Rs 36.30) declined.
Shares of Essar group companies surged. Essar Ports jumped 10.17% to Rs 91. On BSE, 24.06 lakh shares were traded in the counter, compared with average daily volume of 1.05 lakh shares in the past one quarter.
Essar Oil jumped 6% to Rs 107.80. On BSE, 44.67 lakh shares were traded in the counter, compared with average daily volume of 10.83 lakh shares in the past one quarter.
Essar Shipping jumped by the maximum permissible daily level of 5% for the stock at Rs 24.35.
KPR Mill rose 4.46% after the company said that in order to meet increased demand in garment exports, the company has initiated expansion plans in its garment business. The announcement was made during market hours today, 10 June 2014. The company has decided to add 10 million pieces per annum at existing garment manufacturing facility. This will increase its present capacity of 30 million pieces to 40 million pieces per annum (single shift). Since major infrastructures are already in place, its operation is expected during the first quarter of FY 2015, KPR Mill said.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 59.28, compared with its close of 59.20/21 on Monday, 9 June 2014.
The National Stock Exchange (NSE) has decided to conduct an auction for the allocation of unutilized debt limits for Government Debt category tomorrow, 11 June 2014. The amount for the auction has been set at Rs 7152 crore. As per debt utilisation status available on NSDL, the total investment of all the FIIs/FPIs/QFIs in Government Debt (auction) reached Rs 92394 crore on Monday, 9 June 2014, which is 92.82% of total permitted limit of Rs 99546 crore. Separately, NSE said in another circular that FIIs should not increase their long position in interest rate futures (IRF) till the time the overall long position of FIIs in cash and IRF comes below 85% of existing permissible limit.
India can easily cut down its fiscal deficit without hurting people, if there is enough political will, the finance ministry's principal economic adviser Ila Patnaik reportedly said in a panel discussion in her capacity as an economist. Patnaik also said there were enough leakages in schemes and excess subsidies to cut the country's deficit, while replying in her private capacity to a question on fiscal consolidation.
The India Meteorological Department (IMD) on Monday, 9 June 2014, said rainfall over the country as a whole for the 2014 southwest monsoon season (June to September) is likely to be below normal (90-96% of long period average). Quantitatively, monsoon season rainfall for the country as a whole is likely to be 93% of the long period average with a model error of 4%. Region wise, the season rainfall is likely to be 85% of LPA over North-West India, 94% of LPA over Central India, 93% of LPA over South Peninsula and 99% of LPA over North-East India, all with a model error of 8 %. The monthly rainfall over the country as whole is likely to be 93% of its LPA during July and 96% of LPA during August both with a model error of 9.
After IMD's forecast of below normal rains this year, Agriculture Minister Radha Mohan Singh on Monday, 9 June 2014, reaffirmed government's seriousness in tackling any situation arising out of poor monsoon. Contingency plans are already in place, state governments have been suitably advised, sufficient foodstocks are in place, and quick action will be taken to tackle any situation arising out of deficient monsoon, he said. Storage position in major reservoirs across the country, except in Southern India, is satisfactory, the Ministry of Agriculture said. Crop contingency plans have been developed for 500 out of about 540 agricultural districts by Central Research Institute of Dryland Agriculture (CRIDA) in collaboration with State Agricultural Universities and concerned state governments to deal with challenges posed by aberrant monsoon.
India's farm sector accounts for 14% of India's nearly $2 trillion economy, with two-thirds of its 1.2 billion population living in rural areas.
Rains are vital to rejuvenate an economy battling its longest economic slowdown since the 1980s and to cool inflation running close to double digits. The new government on Monday made fighting food inflation its top priority.
Finance Minister Arun Jaitley on Monday, 9 June 2014, said at a Pre-Budget Meeting with the finance ministers of all states and union territories that the Centre and the states must complement each other in managing the economy and the fiscal policy. Goods and Services Taxes (GST) is one pending issue on which consensus needs to be built and implementation done at an early date, Jaitley said. Implementation of GST has the potential to significantly improve the growth story, he said.
Jaitley said the government is committed to breaking the vicious cycle of high inflation and high interest rates.
The next major trigger for the market is the Union Budget for 2014-15. Jaitley is expected to table Union Budget for 2014-15 in Lok Sabha by mid-July 2014. An interim budget was presented by P. Chidambaram in February this year. Essentially, in the nature of a vote on account, the interim budget was intended to get Parliament approval for expenditure to be incurred during the first few months of fiscal year 2014-15 due to Lok Sabha elections.
European stocks edged higher in choppy trade on Tuesday, 10 June 2014, after positive economic data in UK and France. Key benchmark indices in France and Germany were up 0.13% to 0.18%. UK's FTSE 100 fell 0.37%.
UK industrial production rose for a third month in April, driving the annual increase to the biggest since 2011. Output rose 0.4% from March, when it gained a revised 0.1%, the Office for National Statistics said today in London.
French industrial production rebounded in April on an increase in manufacturing and energy and output, national statistics bureau Insee said Tuesday. Industrial output rose 0.3% in April from March, and Insee revised the March reading upwards to a 0.4% contraction from a 0.7% contraction previously.
Meanwhile, French business sentiment declined in May and economic growth will be tepid in the second quarter of the year, a Bank of France survey showed Tuesday. Based on its monthly survey, the Bank of France expects the economy will grow only 0.2% in the second quarter from the first.
Asian stocks edged up on Tuesday, 10 June 2014, after a record close for US stocks on Monday on the back of economic optimism in the US. Key benchmark indices in Taiwan, Hong Kong, Indonesia, South Korea and China were up 0.65% to 1.25%. Key benchmark indices in Japan and Singapore were off 0.34% to 0.85%.
China's central bank said it will cut the level of deposits that banks have to keep with it by 50 basis points for some lenders, a move aimed at freeing up more cash for loans to bolster flagging economic growth. The People's Bank of China said in a statement that the reduction would be effective from June 16, and will apply to banks whose new loans to the farm sector last year exceeded 50% of total new lending for 2014. It is also a requirement that outstanding loans to the farming sector exceeds 30% of total outstanding loans. The central bank said in a short statement that current liquidity in China's banking system was ample, and that the direction of the country's monetary policy had not changed.
China's inflation accelerated in May to the fastest pace in four months on food costs, while a decline in factory-gate prices moderated. Consumer prices rose 2.5% from a year earlier, the statistics bureau said today in Beijing. The producer-price index fell 1.4% after a 2% decline the previous month.
Trading in US index futures indicated that the Dow could fall 19 points at the opening bell on Tuesday, 10 June 2014. US stocks rose on Monday, with benchmark indexes extending records, as small-cap shares rallied and Family Dollar Stores Inc. advanced with Analog Devices Inc. amid deals activity.
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