A bout of volatility was witnessed as key benchmark indices reversed intraday gains in mid-morning trade. The barometer index, the S&P BSE Sensex, was down 15.54 points or 0.08%, off 89.61 points from the day's low and off 13.19 points from the day's low. The market breadth, indicating the overall health of the market, was strong. In the foreign exchange market, the rupee edged higher against the dollar.
NTPC dropped as the stock turned ex-dividend today, 31 January 2014, for interim dividend of Rs 4 per share for the year ending 31 March 2014. Hero MotoCorp (HMCL) fell in volatile trade after Managing Director & Chief Executive Officer Mr. Pawan Munjal said at the time of announcement of the company's Q3 December 2013 results on Thursday, 30 January 2013, that the company's earnings before interest, taxation, depreciation and amortization (EBITDA) was affected due to partial recovery of rising metal costs and currency fluctuation. Realty stocks rose on renewed buying. Bayer CropScience fell after declaring weak Q3 result after market hours on Thursday, 30 January 2014. Balkrishna Industries surged after announcing strong Q3 result after market hours on Thursday, 30 January 2014.
Key benchmark indices alternately swung between positive and negative zone in early trade. Key benchmark indices extended intraday gains and hit fresh intraday high in morning trade. A bout of volatility was witnessed as key benchmark indices reversed intraday gains in mid-morning trade.
Foreign institutional investors (FIIs) sold shares worth a net Rs 430.20 crore on Thursday, 30 January 2014, as per provisional data from the stock exchanges.
At 11:15 IST, the S&P BSE Sensex was down 15.54 points or 0.08% to 20,482.71. The index gained 74.07 points at the day's high of 20,572.32 in morning trade, its highest level since 29 January 2014. The index fell 28.73 points at the day's low of 20,469.52 in mid-morning trade.
The CNX Nifty was down 1.15 points or 0.01% to 6,072.55. The index hit a high of 6,097.30 in intraday trade, its highest level since 29 January 2014. The index hit a low of 6,068.35 in intraday trade.
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The BSE Mid-Cap was up 45.45 points or 0.78% at 6,259.82. The BSE Small-Cap index was up 57.71 points or 0.93% to 6,239.51. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1,231 shares gained and 766 shares fell. A total of 124 shares were unchanged.
The total turnover on BSE amounted to Rs 536 crore by 11:20 IST.
Among the 30-share Sensex pack, 16 stocks gained and rest of them declined.
Tata Motors (down 2.82%), HDFC (down 1.44%) and Bajaj Auto (down 1.2%) edged lower from the Sensex pack.
NTPC lost 3.08% as the stock turned ex-dividend today, 31 January 2014, for interim dividend of Rs 4 per share for the year ending 31 March 2014.
Hero MotoCorp (HMCL) fell in volatile trade after Managing Director & Chief Executive Officer Mr. Pawan Munjal said at the time of announcement of the company's Q3 December 2013 results on Thursday, 30 January 2013, that the company's earnings before interest, taxation, depreciation and amortization (EBITDA) was affected due to partial recovery of rising metal costs and currency fluctuation. The stock was off 1.44% at Rs 1,971. The stock hit a high of Rs 2,028.65 and low of Rs 1,963 so far during the day.
HMCL's net profit rose 7.53% to Rs 524.66 crore on 11.13% increase in total turnover (net sales and other operating income) to Rs 6876.78 crore in Q3 December 2013 over Q3 December 2012. Sales volume rose 6.85% to 16.80 lakh two-wheelers in Q3 December 2013 over Q3 December 2012. EBITDA (earnings before interest, taxation, depreciation and amortization) margin stood at 13.06% in Q3 December 2013.
Commenting on the company's financial performance for Q3 December 2013, Mr. Pawan Munjal, Managing Director & Chief Executive Officer, Hero MotoCorp said: "We have been able to post solid sales in the quarter in a relatively dull market, and our PAT and total turnover figures are up from the corresponding quarter last year. However, our EBITDA has been affected due to partial recovery of rising metal costs and currency fluctuation. We continue to sustain our market-leadership quarter after quarter with a strong focus on performance and profitability, and going forward, we plan to further strengthen our leadership and demonstrate our prowess in innovation and technology. While the industry overall is under constant pressure due to a number of reasons, we are confident of and committed to deliver value to our stakeholders. For this, we will continue to challenge the existing benchmarks and innovate constantly to pave way for improved performance. We are excited about the upcoming Auto Expo where we will be showcasing our vision for the future of two-wheelers. Only yesterday, we gave you a glimpse of the range of products that we are developing. But there's more to come -- several more products, including new concepts which you will get to see at the Delhi Motor Show in February".
Delivering on its commitment to bring revolutionary products in the two-wheeler market, Hero MotoCorp (HMCL) on Wednesday, 29 January 2014, unveiled a slew of game-changing two-wheelers across-the-spectrum. The next-generation range of two-wheelers includes the new 250-cc sports bike 'HX250R', the break-through Liquid-cooled Turbo Charged Diesel Concept Bike 'RNT', India's first series hybrid scooter 'LEAP' and 110cc scooter 'Dash'.
Realty stocks rose on renewed buying. Godrej Properties (up 4.83%), Parsvnath Developers (up 0.43%), DLF (up 1.6%), Indiabulls Real Estate (up 0.06%), D B Realty (up 0.85%) and Unitech (up 0.49%) gained. HDIL fell 1.09%.
Oberoi Realty jumped 5.57% after Supreme Court on Thursday, 30 January 2014, dismissed the previous Bombay High Court order that restricted several acres of forest land in suburban Mumbai for development. The company made the announcement after market hours on Thursday, 30 January 2014.
Oberoi Realty said that certain properties of its wholly-owned subsidiary, Oberoi Constructions (OCL), situated in village Nahur and village Mulund were declared as private forest. OCL had challenged decision by a writ petition in Bombay High Court against the State of Maharashtra and others. This writ petition was dismissed by the Bombay High Court vide an order dated 24 March 2008.
OCL later filed a special leave petition before the Supreme Court challenging the said order of the Bombay High Court.
The Supreme Court in the said Special Leave Petition on Thursday, 30 January 2014, pronounced a judgement setting aside the said order of the Bombay High Court, Oberoi Realty said in a statement.
Bayer CropScience fell 3.85% after net profit fell 95.68% to Rs 39 crore on 12.07% rise in net sales to Rs 626.60 crore in Q3 December 2013 over Q3 December 2012. The company announced the result after market hours on Thursday, 30 January 2014.
Bayer CropScience announced after market hours on Thursday, 30 January 2014, that Mr. Stephan Gerlich ceased to be the Vice Chairman and Managing Director of the company and also as a member of the board of directors with effect from closing hours of 30 January 2014. Mr. Richard van der Merwe was appointed as Vice Chairman and Managing Director of the company with effect from 1 February 2014.
Balkrishna Industries surged 7.71% after net profit jumped 66.4% to Rs 123.85 crore on 24.2% growth in net sales to Rs 867.32 crore in Q3 December 2013 over Q3 December 2012. The Q3 result was announced after market hours on Thursday, 30 January 2014.
Balkrishna Industries' board of directors at a meeting held on Thursday, 30 January 2014, approved a scheme of arrangement for amalgamation of Balkrishna Paper Mills (a wholly owned subsidiary) with the company and demerger of the paper board business division, together with investment in Balkrishna Synthetics, on a going concern basis in to Nirvikara Paper Mill. Upon completion of the Scheme, Nirvikara Paper Mills will issue and allot one fully paid up equity share of Rs 10 each for every nine equity shares held in the company as on the record date to be fixed for this purpose after receipt of all approvals. Upon completion of the Scheme, all shareholders of the company shall become the shareholders of Nirvikara Paper Mills which is proposed to be listed on the Bombay Stock Exchange and the National Stock Exchange of India, Balkrishna Industries said.
The appointed date for the proposed amalgamation is 1 April 2013 and the demerger shall take effect from the date on which the orders of the Bombay High Court, sanctioning the scheme of arrangement is filed with the Registrar of Companies, Maharashtra, Balkrishna Industries said.
Balkrishna Industries said that the proposed scheme of arrangement will re-organize and segregate the paper board business division, together with investment in Balkrishna Synthetics as a separate listed entity resulting in a focused independent management, streamline the operations and provide access to varied sources of raising funds to achieve the growth potential of paper board business. The proposed scheme of arrangement will create enhanced value for shareholders and allow a focused growth strategy, which would be in the best interest of the company, its shareholders, creditors and all stakeholders, it added. The restructuring proposed by this scheme of arrangement will also provide an opportunity to the investors to select investments which best suit their investment strategies and risk profiles, the company said.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 62.5025, compared with its close of 62.56/57 /11 on Thursday, 30 January 2014.
India's consumer inflation should ease in the next two months, and will fall to 8% by the end of the year, Reserve Bank of India (RBI) Governor Raghuram Rajan said in an interview with TV news channel on Thursday, 30 January 2014. The consumer price index eased to a three-month low of 9.87% in December 2013. "There is some disinflation in the system. What was 9.87 is going to come down further next month, and probably a little further into March," Rajan said. "We are setting rates at a level that we think is consistent with that disinflation for us to get some bite and for the inflation in the system to come down to about 8% at the end of the year," Rajan said.
In an interview to another TV news channel, Rajan on Thursday disputed criticism that lower interest rates would lead to higher growth because banks are fixing interest rates based on inflation. "This notion somehow that the RBI is standing in the way of growth is complete nonsense, Rajan said. "Today what is standing in the way of growth is inflation. Unless we bring inflation down, growth with lower interest rates has no hope," Rajan said.
Rajan warned of a breakdown in global policy coordination after the Federal Reserve further cut stimulus, noting how emerging markets helped pull the global economy out of crisis starting in late 2008. "Industrial countries have to play a part in restoring that, and they can't at this point wash their hands off and say we'll do what we need to and you do the adjustment. Fortunately the IMF has stopped giving this as its mantra, but you hear from the industrial countries: We'll do what we have to do, the markets will adjust and you can decide what you want to do," Rajan said. "We need better cooperation and unfortunately that's not been forthcoming so far," he said.
Rajan said developed countries might not like adjustments emerging markets take to cope with the outflows, without elaborating on specific measures.
Most Asian market were closed today, 31 January 2014, for the Lunar new year holiday. In Japan, the Nikkei 225 index lost 0.62% to settle at 14,914.53. China's markets remain closed until 7 February 2014 for the Lunar New Year holiday, while Hong Kong is shut until 4 February 2014.
Japanese industrial production rose 1.1% on month in December, the Ministry of Economy, Trade and Industry said Friday, on a demand rush ahead of an April sales tax increase. It also comes after a 0.1% decline in November. The increase in industrial output was due to a rise in production in the general purpose and production machinery sectors as well as electronic parts and devices.
Meanwhile, Japanese consumer prices rose at their sharpest rate in over five years in December, the government said Friday. Consumer prices also increased for the whole of 2013, the first annual increase in five years, according to data released by the Ministry of Internal Affairs and Communications.
The core consumer price index, which excludes volatile fresh-food costs, climbed 1.3% from a year earlier in December, faster than a 1.2% gain in the previous month, according to data released by the Ministry of Internal Affairs and Communications. It was the biggest rise since a 1.9% increase in October 2008. The core index for 2013 increased 0.4% after a 0.1% fall the previous year. The CPI including fresh food prices rose 1.6% on year in December.
Employment data released Friday also suggested a strongly recovering economy. The jobless rate fell to 3.7% of the work force, down from 4% in November and the lowest rate since December 2007. The closely watched ratio of available jobs to applicants also improved to 1.03, meaning 103 jobs were on offer for every 100 job seekers.
US stocks rebounded on Thursday, 30 January 2014, as investors welcomed data showing a robust pace of growth in the economy in the final quarter of last year, while upbeat earnings from Facebook Inc. boosted the tech sector.
The US economy expanded rapidly in the final quarter of 2013, the Commerce Department said on Thursday, 30 January 2014, as consumers shrugged off a government shutdown, with the data fueling hopes of even faster growth ahead. The gross domestic product grew at 3.2% annual pace.
The number of people who sought US unemployment benefits near the end of January rose to the highest level in six weeks, but it's unclear whether the increase is the residue of holiday-season distortions or reflects a deterioration in the labor market. The less-volatile, four-week average rose by a fraction.
Meanwhile, Janet Yellen will be sworn in as chairwoman of the Federal Reserve on Monday, 3 February 2014, the US central bank announced Thursday, 30 January 2014. Yellen will replace outgoing Fed Chairman Ben Bernanke, whose term as chairman expires on Friday, 31 January 2014.
The Federal Reserve on 29 January 2014 took another gradual step toward exiting its controversial bond-buying program. As expected, the Fed decided, after a monetary policy review, to reduce the pace of monthly asset purchases to $65 billion, from January's $75 billion. The Fed also signaled that it is likely to keep reducing its purchases in the coming months, citing a pickup in economic activity and improvement in the labor market.
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