Key benchmark indices surged after the main opposition party -- the Bharatiya Janata Party (BJP) -- in its Lok Sabha polls manifesto released early this week promised more business-friendly policies if the party comes to power after elections. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit lifetime high on intraday basis as well as on closing basis. The Sensex surged 358.89 points or 1.61%, up about 322 points from the day's low and off close to 38 points from the day's high. The market breadth, indicating the overall health of the market was strong. The BSE Small-Cap index rose more than 2%. The market sentiment was boosted by data showing that foreign institutional investors (FIIs) remained net buyers of Indian stocks on Monday, 7 April 2014. Gains in Asian and European stocks also boosted sentiment on the domestic bourses.
The Sensex has risen 316.07 points or 1.41% in this month so far (till 9 April 2014). The Sensex has gained 1,531.66 points or 7.23% in calendar year 2014 so far (till 9 April 2014). From a 52-week low of 17,448.71 on 28 August 2013, the Sensex has risen 5,253.63 points or 30.11%.
Coming back to today's trade, bank shares rose across the board. Among auto stocks, Eicher Motors hit a record high. Bharat Forge hit 52-week high. Aviation stocks rallied. Pharma stocks rose. Among capital goods shares, Crompton Greaves hit 52-week high. Index heavyweight Reliance Industries (RIL) edged higher.
The market edged higher in early trade on firm Asian stocks. Key benchmark indices extended initial gains and hit fresh intraday high in morning trade. The Sensex trimmed gains in mid-morning trade. The Sensex further pared gains in early afternoon trade. Key benchmark indices extended intraday gains in afternoon trade as European stocks edged higher in early trade there. Key benchmark indices extended intraday gains and hit fresh intraday high in mid-afternoon trade. Key benchmark indices surged in late trade. The Sensex and the 50-unit CNX Nifty, both, hit record high.
The market sentiment was boosted by data showing that foreign funds remained net buyers of Indian stocks on Monday, 7 April 2014. Foreign institutional investors (FIIs) bought shares worth a net Rs 703.71 crore on Monday, 7 April 2014, as per provisional data from the stock exchanges. The stock markets was closed on Tuesday, 8 April 2014, on account of Ram Navami.
The S&P BSE Sensex garnered 358.89 points or 1.61% to settle at 22,702.34, a record closing high. The index jumped 396.59 points at the day's high of 22,740.04 in late trade, a lifetime high for the barometer index. The index rose 36.50 points at the day's low of 22,379.95 in early afternoon trade.
Also Read
The CNX Nifty garnered 101.15 points or 1.51% to settle at 6,796.20, a record closing high. The index hit a high of 6,808.70 in intraday trade, a lifetime high for the index. The index hit a low of 6,705.10 in intraday trade.
The BSE Mid-Cap index rose 120.03 points or 1.68% to settle at 7,285.39. The BSE Small-Cap index rose 146.28 points or 2.01% to settle at 7,427.35. Both these indices outperforming the Sensex.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1,873 shares rose and 877 shares fell. A total of 110 shares were unchanged.
The total turnover on BSE amounted to Rs 2310 crore, higher than Rs 1515.34 crore on Monday, 7 April 2014.
The S&P BSE Bankex (up 3.45%), the S&P BSE Metal index (up 2.26%), the S&P BSE Healthcare index (up 2.21%), the S&P BSE Realty index (up 1.85%), the S&P BSE Capital Goods index (up 1.83%), the S&P BSE Auto index (up 1.77%) and the S&P BSE Power index (up 1.75%), outperformed the Sensex.
The S&P BSE FMCG index (up 0.5%), the S&P BSE Oil & Gas index (up 1.23%) and the S&P BSE Consumer Durables index (up 1.29%), underperformed the Sensex. The S&P BSE IT index (down 1.09%) and the S&P BSE Teck index (down 0.84%) edged lower, underperforming the Sensex.
Among the 30 Sensex shares, 26 rose and the rest declined.
Bank stocks were in demand. Union Bank of India (up 6.49%), Bank of Baroda (up 5.41%), Federal Bank (up 4.89%), Axis Bank (up 4.44%), IDBI Bank (up 4.36%), Yes Bank (up 4.19%), ICICI Bank (up 4.18%), Punjab National Bank (up 3.99%), Bank of India (up 3.78%), Canara Bank (up 3.67%), IndusInd Bank (up 3.63%), State Bank of India (up 3.23%), HDFC Bank (up 2.34%) and Kotak Mahindra Bank (up 2.19%), edged higher.
Eicher Motors rose 3.43% to close at a record high level of Rs 6,240.
Bharat Forge rose 1.14% to Rs 441. The stock hit a 52-week high of Rs 446.55 in intraday today, 9 April 2014.
Infosys fell 1.16% to Rs 3253.10. The company after market hours today, 9 April 2014, announced that its Finacle core banking solution running on an Oracle SuperCluster engineered system has set new global benchmarks for the number of transactions processed across key banking functions. In a test that was audited and reviewed by the global audit firm, Ernst & Young, the solution supported over 1.9 billion bank accounts with near linear scalability - a number higher than the current population of China, the most populous country in the world.
The test also saw Finacle processing 726 million effective transactions in four hours, or over 50,000 average transactions per second, to manage workloads comprising of multiple online transactions and customer touch points as well as third-party systems. This represents six times the daily volume of transactions currently processed by the entire US banking system, based on industry estimates of transaction volumes. These results highlight Finacle's capabilities to help banks manage extremely large transaction volumes and cater to a dynamically growing customer base at lower costs, Infosys said.
Index heavyweight Reliance Industries (RIL) rose 1.81% to Rs 961.10. The sock hit a 52-week high of Rs 964.85 in intraday trade. The stock hit a low of Rs 936.80 in intraday trade.
Capital goods stocks edged higher. Praj Industries (up 7.33%), Suzlon Energy (up 7.02%), Pipavav Defence & Offshore Engineering Company (up 4.93%), BEML (up 3.76%), Punj Lloyd (up 3.69%), Bharat Electronics (up 3.06%), Jindal Saw (up 2.5%), Bhel (up 2.14%), ABB (up 2.03%), Alstom T&D India (up 1.71%), Siemens (up 1.39%), Havells India (up 1.35%), Thermax (up 1.28%), L&T (up 1.25%), AIA Engineering (up 0.53%) and Lakshmi Machine Works (up 0.14%), edged higher.
Crompton Greaves rose 8.95% to Rs 164.95 after hitting 52-week high of Rs 166.50 n intraday trade.
Pharma stocks rose. Sun Pharmaceutical Industries rose 6.91% to Rs 627.80, with the stock extending Monday's gains. Ranbaxy Laboratories gained 4.90% to Rs 467. The two companies in a joint statement issued on Sunday, 6 April 2014, announced that they have entered into definitive agreements pursuant to which Sun Pharma will acquire 100% of Ranbaxy in an all-stock transaction. As per the share swap ratio, Ranbaxy shareholders will receive 8 shares of Sun Pharma for every 10 equity shares of Ranbaxy. This exchange ratio represents an implied value of Rs 457 for each Ranbaxy share, a premium of 18% to Ranbaxy's 30-day volume-weighted average share price and a premium of 24.3% to Ranbaxy's 60-day volume-weighted average share price, in each case, as of the close of business on 4 April 2014.
The combination of Sun Pharma and Ranbaxy creates the fifth-largest specialty generics company in the world and the largest pharmaceutical company in India. The combined entity will have operations in 65 countries, 47 manufacturing facilities across 5 continents, and a significant platform of specialty and generic products marketed globally, including 629 ANDAs. On a pro forma basis, the combined entity's revenues are estimated at $4.2 billion with EBITDA of $1.2 billion for the twelve month period ended December 31, 2013. The transaction value implies a revenue multiple of 2.2 based on 12 months ended 31 December 2013.
Sun Pharma at the fag end of the trading session today, 9 April 2014, issued clarification in response to various reports on Silverstreet's investment in Ranbaxy. This pertains to purchase of shares of Ranbaxy Laboratories by Silverstreet Developers LLP and it does not violate insider trading rules, Sun Pharma said. Mr. Sudhir Valia is not and was not a partner of Silverstreet Developers LLP when purchase of shares of Ranbaxy Laboratories was affected by LLP. Silverstreet Developers LLP has two partners. Both are 100% subsidiaries of Sun Pharma. Hence, all the benefits flowing from the investment in Ranbaxy shall accrue to Sun Pharma, Sun Pharma said in a statement.
Shares of other pharma stocks rose on hopes of further consolidation in the sector after Sun Pharma announced the acquisition of Ranbaxy. Strides Arcolab (up 1.93%), Aurobindo Pharma (up 1.28%), Cipla (up 0.84%), Divi's Laboratories (up 0.69%), Dr. Reddy's Laboratories (up 0.37%), Wockhardt (up 0.20%) and Biocon (up 0.06%), edged higher.
Lupin gained 1.36% to Rs 973.95. The company announced during market hours that it has received final approval for its Pioglitazone Tablets USP, 15 mg,30 mg, and 45 mg from the United States Food and Drugs Takeda Pharmaceuticals to market a generic version of Takeda Pharmaceuticals USA, Inc.'s Actos Tablets, 15 mg, 30 mg, and 45 mg. Lupin Pharmaceuticals Inc. (LPI), the company's US subsidiary would commence marketing the product shortly. Lupin's Pioglitazone Tablets USP, 15 mg ,30 mg, and 45 mg are the AB-rated generic equivalents of Takeda's Actos Tablets 15 mg, 30 mg, and 45 mg and indicated as an adjunct to diet and exercise to improve glycemic control in adults with type 2 diabetes mellitus in multiple clinical settings.
Actos Tablets has annual US sales of $236 million (IMS MAT Dec, 2013).
Aviation stocks rallied. SpiceJet (up 6.38%) and Jet Airways India (up 6.24%), surged.
Jaihind Projects rose by maximum permissible 5% upper circuit at Rs 19.05 on BSE, after the company bagged an order worth Rs 114.83 crore. The announcement was made on Tuesday, 8 April 2014. Jaihind Projects on Tuesday, 8 April 2014 said that the company has bagged an EPC (Engineering, Procurement and Construction) order worth Rs 114.83 crore from Indian Oil Corporation for laying of mainline for Paradip-Haldia-Durgapur LPG Pipeline Project (PHDPL)-Group-A.
OnMobile Global surged 6.60% to Rs 36.35 after the company executed a non-binding memorandum of understanding for the potential divestment of its group company, Voxmobili SA. The announcement was made during market hours today, 9 April 2014. OnMobile Global executed a non-binding Memorandum of Understanding (MoU) for the potential divestment of its group company, Voxmobili SA, which specializes in mobile telecommunication products. The proposed deal will be subject to and contingent upon certain events, including applicable regulatory and shareholders' approvals. If the proposed deal were to consummate, OnMobile could realize an amount ranging between $23 million to $26 million for the divestment of the said company (which is around its book value), subject to escrows and other conditions customarily contracted as a part of such a deal, the company said.
Prime Focus rose 5.55% to Rs 29.50 after the company said its technology subsidiary has raised Rs 45 crore through a private placement of optionally convertible debentures. The announcement was made during trading hours today, 9 April 2014.
Prime Focus said that its technology subsidiary Prime Focus Technologies (PFT) has raised Rs 45 crore through a private placement of optionally convertible debentures from a diverse base of high net-worth individuals. The funds raised would be used to fuel expansion of its Cloud Technology, CLEAR in the global markets as well as for retiring debt. After 2 years, investors will also have an option of converting up to 25% of the total principal amount into equity of PFT, the company said. As part of the process, the current base equity valuation of PFT as determined by a Big Four accounting firm has been established at approximately Rs.1100 crore, Prime Focus said in a statement.
Ramki Sankaranarayanan, Founder and CEO, PFT, said, "We are extremely pleased with the investor interest in PFT. Through this attractively structured instrument, we have secured growth capital while broad-basing our investor base and at the same time creating a compelling opportunity for shareholder value creation at PFT as well as the ultimate shareholders at PFL level".
PFT which has grown at over 150% YoY since inception six years ago, aims to replicate its initial success with broadcasters, in the North American studio production segment, Prime Focus said in a statement. In line with this strategy, PFT recently acquired US-based DAX, a leading provider of cloud-based production workflow and media asset management applications to the entertainment industry in North America.
Prime Focus Technologies is the technology subsidiary of Prime Focus, the global leader in media and entertainment industry services.
D B Corp clocked a highest turnover of Rs 177.54 crore on BSE. Sun Pharmaceutical Industries (Rs 70.33 crore), Ranbaxy Laboratories (Rs 60.73 crore), State Bank of India (Rs 48.62 crore) and Infosys (Rs 32.02 crore) were the other turnover toppers on BSE in that order.
SpiceJet reported highest volumes of 68.38 lakh shares on BSE. Suzlon Energy (64.36 lakh shares), D B Corp (60.24 lakh shares), Empower India (53.60 lakh shares) and Unitech (52.19 lakh shares) were the other volume toppers on BSE in that order.
Investors are betting that the Bharatiya Janata Party (BJP) led National Democratic Alliance (NDA) will be able to form the next government at the centre with support from some regional parties after Lok Sabha elections which conclude in mid-May this year. Various opinion polls have forecast that BJP led NDA is leading the race to Parliament. The opinion polls have also forecast that the NDA will be unable to form the government on its own and that it will have to rely on support from smaller regional parties to form the government. A party will need 272 MPs to form government at the Centre, which is a simple majority in 543-member Lok Sabha.
The Bharatiya Janata Party (BJP) has promised more business-friendly policies if it wins Lok Sabha polls. In its election manifesto released on Monday, 7 April 2014, the BJP attacked the incumbent Congress-led government for using 'tax terrorism' against companies. The BJP said it would provide a non-adversarial administration and simplify the country's complicated tax laws. The BJP said that economic revival will be the party's priority if it comes to power after elections. In its manifesto, the BJP has promised faster infrastructure development, job creation and measures to control inflation. The BJP said that it will bring on board all state governments in adopting the GST, addressing all their concerns. The party also promised a massive low cost housing program.
With regard to physical infrastructure development, the BJP said Public Private Partnership would be encouraged to tap into private sector resources as well as expertise. An institutional framework would be established for the same; while regulators would be given greater autonomy as well as accountability. Work on the freight corridors and attendant industrial corridors will be expedited, the BJP said. This will result in the faster movement of people and goods, it said. National Highway construction projects will be expedited, especially border and coastal highways, the BJP said. Every village will be connected through all-weather roads, it said.
The BJP said that if the party comes to power after elections, major steps will be undertaken in Transport and Housing for 'Urban Upliftment'. The BJP said it will initiate building 100 new cities enabled with the latest in technology and infrastructure and adhering to concepts like sustainability, walk to work etc, and focused on specialized domains.
A full-fledged programme for 'Rural Rejuvenation' will be made and implemented which will comprise of integrated strategies for personal, economic and social well being of the villagers, the BJP said. BJP's major thrust area for rural development would be to improve village level infrastructure in terms of roads, potable water, education, health, supply chain, electricity, broadband, job creation, security in rural areas and linkage to markets. Agriculture is the engine of India's economic growth and the largest employer, and BJP commits highest priority to agricultural growth, increase in farmer's income and rural development, the party's manifesto states. The BJP said it will increase public investment in agriculture and rural development.
The BJP said it will strictly implement fiscal discipline, without compromising on funds availability for development work and asset creation. The BJP said that it will allocate resources efficiently and effectively to re-energize the engines of growth. The party said it will re-visit the policy framework for investments both foreign and domestic to make them more conducive. The BJP said that the current accounts deficit will be brought down aggressively by focusing on exports and reducing the dependency on imports.
The BJP has that it will encourage savings as an important driver of investment and growth.
The BJP said that it will ensure that a conducive, enabling environment is created making 'doing business' in India easy. The party's manifesto states that it will ensure logistics infrastructure, including stable power. The attempt will be to move towards a single-window system of clearances both at the centre and also at the state level through a Hub-spoke model. The party said it plans to put in place a mechanism that will ensure that the Central and state governments work in close coordination and synergy while giving clearances to mega projects. The BJP said that decision-making on environment clearances will be made transparent as well as time-bound. The party said it will set up world class investment and industrial regions as Global Hubs of Manufacturing.
The party said it wouldn't allow foreign direct investment (FDI) in multi-brand retail in India -- a sign a BJP government would rollback a key liberalization of the Congress government. Barring the multi-brand retail sector, FDI will be allowed in sectors wherever needed for job and asset creation, infrastructure and acquisition of niche technology and specialized expertise, BJP's manifesto stated. The BJP is committed to protecting the interest of small and medium retailers, SMEs and those employed by them, it said. The FIPBs (Foreign Investment Promotion Board) functioning shall be made more efficient and investor friendly, the manifesto stated.
The Securities and Exchange Board of India (Sebi) on Monday, 7 April 2014, partially reversed curbs on dollar-rupee forward contracts that were imposed last year after the rupee hit record low against the dollar. Sebi had doubled the margin requirement on the domestic dollar-rupee forward trades last year in a bid to arrest the steep decline of the rupee. The stock market regulator on Monday, 7 April 2014, asked stock exchanges and clearing corporations to restore the initial margins and extreme loss margin for dollar-rupee trades to pre 8 July 2013 levels from 15 April 2014.
The Reserve Bank of India (RBI) on Monday, 7 April 2014, said that with a view to further liberalising the existing facilities the RBI has decided to allow all resident individuals, firms and companies, who have actual or anticipated foreign exchange exposures to book foreign exchange forward contracts up to $250,000 on the basis of a simple declaration without any requirement of further documentation, the RBI said in a circular issued to Authorised Dealer Category-I (AD Category-I) banks. This is higher than the existing limit of $100,000. The existing facilities in terms of this circular for Small and Medium Enterprises (SMEs) having direct and/or indirect exposures to foreign exchange risk permitting them to book/cancel/roll over forward contracts without production of underlying documents to manage their exposures effectively subject to conditions specified therein shall remain unchanged, the RBI said.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014, as consumer-price inflation eased to a two-year low and as the rupee firmed up against the dollar.
The next major trigger for the stock market is Q4 March 2014 and year ended 31 March 2014 (FY 2014) corporate earnings. Investors and analysts will closely watch the management commentary that would accompany the results to see if there is any revision in their future earnings forecast of the company for the year ending 31 March 2015 (FY 2015) and/or for the year ending 31 March 2016 (FY 2016). Indian companies will start reporting their Q4 and full year results from mid-April 2014. The result season will conclude in end-May 2014.
A major near term trigger for the stock market is the outcome of the upcoming Lok Sabha elections. The 36 days long voting process began on 7 April 2014 and will conclude on 12 May 2014. The results will be declared on 16 May 2014 after which India will get a new government. The term of the current Lok Sabha expires on June 1 and the new House has to be constituted by May 31.
European stocks edged higher on Wednesday, 9 April 2014, as US stocks on Tuesday, 8 April 2014, snapped three straight sessions of losses. Key benchmark indices in UK, France and Germany were up 0.29% to 0.78%.
Sweden's central bank kept its main interest rate unchanged after a monetary policy review today, 9 April 2014, in a bet that an economic recovery will put an end to the threat of deflation. The repurchase rate was held at 0.75% for a second meeting, the Riksbank said in a statement. "Economic activity is clearly strengthening, but inflation is expected to remain low for some time. Monetary policy needs to remain expansionary for inflation to rise towards the target," the Riksbank said.
Meanwhile, Sweden's government today, 9 April 2014, raised its outlook for GDP growth to 2.7% this year, after a 1.5% expansion in 2013.
A monthly meeting of the Monetary Policy Committee of the Bank of England's (BoE) for monetary policy review is scheduled tomorrow, 10 April 2014.
Asian stocks outside Japan rose on Wednesday, 9 April 2014, as consumer companies advanced. Key benchmark indices in Hong Kong, Singapore, China, Taiwan and South Korea were up 0.18% to 1.09% Japanese equities fell after the yen rose against the dollar. The Nikkei 225 Average lost 2.1%.
The Bank of Japan (BOJ) refrained from adding to unprecedented monetary stimulus after a monetary policy review on Tuesday, 8 April 2014, as Governor Haruhiko Kuroda said the blow to the economy from last week's sales-tax increase will fade during the summer. The central bank will continue to expand the monetary base at a pace of 60 trillion yen to 70 trillion yen ($682 billion) per year, it said in a statement in Tokyo. At a press briefing, Kuroda said the BOJ would always adjust policy without hesitation as needed, including easing or tightening. The economy has continued to recover moderately, "albeit with some fluctuations due to the consumption tax hike," the BOJ said in its statement. Kuroda said he will adjust record easing that the BOJ began in April last year should prospects for achieving the price target be jeopardized.
Indonesia's central bank kept its key interest rate unchanged after a monetary policy review on Tuesday, 8 April 2014, extending a pause in monetary tightening as inflation slowed. Bank Indonesia Governor Agus Martowardojo and his board maintained the reference rate at 7.5%, the central bank said in Jakarta. It also kept the deposit facility rate unchanged at 5.75%.
Trading in US index futures indicated that the Dow could advance 30 points at the opening bell on Wednesday, 9 April 2014. US stocks snapped three-day losing streak on Tuesday, 8 April 2014, on bargain-hunting as investors picked up stocks that had fallen the most in the slump over the previous three days.
The US Federal Reserve releases minutes of its March 18-19 gathering today, 9 April 2014. The Federal Reserve on 19 March 2014 said after the conclusion of a monetary policy review that it will trim its monthly bond purchases by $10 billion to $55 billion. The Federal Reserve will end its bond-buying program before the end of the year with an interest-rate increase likely to follow in "around six months," Chair Janet Yellen said on 19 March 2014. Quarterly Fed forecasts on 19 March 2014 showed more officials predicting that the benchmark interest rate, now close to zero, will rise to at least 1% by the end of 2015 and 2.25% a year later.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 29-30 April 2014.
Stronger US growth this year and next will help the world economy withstand weaker recoveries in emerging markets including Brazil and Russia, the International Monetary Fund (IMF) said in a report yesterday, 8 April 2014. The IMF predicted global growth of 3.6% this year, compared with a January estimate of 3.7%. Next year, the expansion will accelerate to 3.9%, unchanged from the prior forecast. Developing Asian economies are forecast to grow 6.7% this year, the IMF said.
Powered by Capital Market - Live News