A resumption of fall in global crude oil prices and data showing continuation of buying of Indian stocks by foreign funds boosted sentiments as the barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit record high. The market breadth indicating the overall health of the market was positive. The Sensex was provisionally up 96.11 points or 0.34% at 28,142.77. The BSE Small-Cap index was up 1.09%, 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 645.90 crore during the previous trading session on Friday, 14 November 2014, as per provisional data. 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.
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. 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.
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.
As per provisional closing, the S&P BSE Sensex was up 96.11 points or 0.34% at 28,142.77. The index jumped 159.05 points at the day's high of 28,205.71 in late trade, a record 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 was up 40.85 points or 0.49% to 8,430.75. The index hit a high of 8,438.10 in intraday trade, a record high for the index. The index hit a low of 8,349.10 in intraday trade.
The BSE Mid-Cap index was up 91.53 points or 0.9% at 10,246.34. The BSE Small-Cap index was up 121.93 points or 1.09% at 11,339.32. Both these indices outperformed the Sensex.
The market breadth indicating the overall health of the market was positive. On BSE, 1,611 shares advance and 1,446 shares declined. A total of 87 shares were unchanged.
The total turnover on BSE amounted to Rs 3383 crore, lower than Rs 3459.09 crore on Friday, 14 November 2014.
Index heavyweight Reliance Industries (RIL) rose 1.54% to Rs 984.10. 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 3.76% to Rs 543.50 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.
PSU bank stocks gained across the board. Punjab National Bank (up 2.65%), Bank of India (up 1.03%), Bank of Baroda (up 4.42%), Union Bank of India (up 1.84%), Allahabad Bank (up 0.67%) and Canara Bank (up 1.86%) 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 5.4% at Rs 2,939. 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.
Sun Pharmaceuticals Industries shed 0.62%. 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).
HCL Technologies rose 0.58%. 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 biscuits major Britannia Industries gained 1.16% to Rs 1,644 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.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 61.77, 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 $1.15 a barrel at $78.26 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.
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 0.49% to 0.84%.
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 77 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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