Volatility ruled the roost as key benchmark indices once again slipped into the red after moving into the green from red in early trade. The barometer index, the S&P BSE Sensex, was currently off 31.49 points or 0.11% at 27,765.52. The market breadth indicating the overall health of the market was strong. State Bank of India (SBI) Chairperson Arundhati Bhattacharya reportedly said yesterday, 9 December 2014, that lending rates will come down only after the bank is able to bring down its cost of funds and sees a pickup in credit growth, so that higher volumes can compensate for the income loss.
Shares of steel makers advanced after India's Ministry of Commerce & Industry yesterday, 9 December 2014, said that India has achieved a significant victory at the WTO, as the WTO Appellate Body (AB) in its ruling dated 8 December 2014 held that the Countervailing Duty (CVD) measures imposed by the United States against certain hot rolled carbon steel flat products from India are inconsistent with various provisions of the Agreement on Subsidies and Countervailing Measures (ASCM). Canara Bank advanced after the bank announced a reduction in interest rates on term deposits with effect from today, 10 December 2014.
Russian President Vladimir Putin arrives on a two-day visit to India today, 10 December 2014, for the 15th Annual India-Russia Summit.
Earlier, the Sensex had hit its lowest level in almost 6 weeks and the 50-unit CNX Nifty had its lowest level in more than 4 weeks in early trade.
Foreign portfolio investors sold shares worth a net Rs 221.52 crore yesterday, 9 December 2014, as per provisional data.
In overseas markets, Asian stocks edged lower amid political uncertainty in Greece after the European nation's surprise elections announcement yesterday, 9 December 2014. The US stock market staged a rebound yesterday, 9 December 2014, but still ended the day lower, even after erasing steep opening losses sparked by China's tightening of lending rules and Greece's surprise elections announcement.
In the foreign exchange market, the rupee edged lower against the dollar.
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Brent crude oil futures edged lower on worries over a deepening supply glut. Deregulation of diesel price announced by the Indian government in October 2014 and a sharp decline in global crude oil prices over the past few months will help 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.
At 10:15 IST, the S&P BSE Sensex was down 31.49 points or 0.11% at 27,765.52. The index lost 86.98 points at the day's low of 27,710.03 in early trade, its lowest level since 31 October 2014. The index gained 78.28 points at the day's high of 27,875.29 in early trade.
The CNX Nifty was down 6.75 points or 0.08% at 8,333.95. The index hit a low of 8,317 in intraday trade, its lowest level since 10 November 2014. The index hit a high of 8,361.80 in intraday trade.
The BSE Mid-Cap index was up 47.32 points or 0.46% at 10,253.85. The BSE Small-Cap index was up 57.84 points or 0.52% at 11,251.96. Both these indices outperformed the Sensex.
The market breadth indicating the overall health of the market was strong. On BSE, 1,193 shares gained and 710 shares fell. A total of 76 shares were unchanged.
Steel stocks advanced. Steel Authority of India (SAIL) (up 0.69%), Jindal Steel & Power (up 2.59%) and Tata Steel (up 0.88%) edged higher.
The Ministry of Commerce & Industry yesterday, 9 December 2014, said that India has achieved a significant victory at the WTO, as the WTO Appellate Body (AB) in its ruling dated 8 December 2014 held that the Countervailing Duty (CVD) measures imposed by the United States against certain hot rolled carbon steel flat products from India are inconsistent with various provisions of the Agreement on Subsidies and Countervailing Measures (ASCM). The AB ruling will definitely help the domestic manufacturers, who had been suffering on account of inconsistent practices by the United States Department of Commerce, India's Ministry of Commerce & Industry said.
JSW Steel rose 1.44% at Rs 1,124. The company after market hours yesterday, 9 December 2014, clarified that there was no accident at the steel plant at Vijayanagar works of the company on 9 December 2014. JSW Steel said that a sudden release of pressure resulted in a huge sound at the plant. The company added that the plant is working normally. JSW issued the clarification after media reports suggested that there was an accident at the steel plant at Vijayanagar works of JSW Steel on 9 December 2014.
State Bank of India (SBI) rose 0.44% at Rs 308.05. State Bank of India (SBI) Chairperson Arundhati Bhattacharya reportedly said yesterday, 9 December 2014, that lending rates will come down only after the bank is able to bring down its cost of funds and sees a pickup in credit growth, so that higher volumes can compensate for the income loss. She was speaking at an event to launch an economic index developed by the bank.
Canara Bank rose 1.37% at Rs 405.60. The bank after market hours yesterday, 9 December 2014, said that the bank has cut interest rates on term deposits with effect from today, 10 December 2014. The bank has reduced the interest rate on term deposits below Rs 1 crore for maturity between 270 days to less than one year to 8.25% from 8.5%. The bank has reduced the interest rate for maturity of one year and above to less than three years to 9% from 9.05%. The bank has reduced the interest rate for maturity of three years and above to less than eight years to 8.75% from 9%. For term deposits above Rs 1 crore, the bank has also reduced the interest rate on deposits for maturity between 46 days to 90 days to 7.75% from 8%. For deposits above Rs 1 crore for maturity between 91 days to 179 days, the rate has been cut to 8.25% from 8.5%. For deposits above Rs 1 crore for maturity of 180 days to not less than two year, the rate has been cut to 8.5% from 8.75%. For deposits above Rs 1 crore for maturity of two years and above to less than three years, the rate has been cut to 8% from 8.75%. For deposits above Rs 1 crore for maturity of three years and above to ten years, the rate has been cut to 8% from 8.5%.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 61.9225, compared with its close of 61.89 during the previous trading session.
Brent crude oil futures edged lower on worries over a deepening supply glut. Brent for January settlement was off 78 cents a barrel at $66.06 a barrel. The contract had gained 65 cents a barrel to settle at $66.84 during the previous trading session.
The Indian government plans to introduce the Coal Mines (Special Provisions) Bill, 2014 to replace the Coal Mines (Special Provisions) Ordinance, 2014 in Lok Sabha this week. The government is also likely to introduce the constitutional amendment bill for the goods & services tax during the ongoing winter session of parliament. The government also plans to bring the MMDR Amendment Bill, 2014 during the ongoing winter session of parliament.
The government also intends to get the Insurance Laws Amendment Bill that seeks to enhance FDI limit in capital starved insurance sector passed during the ongoing winter session of parliament.
Meanwhile, Russian President Vladimir Putin arrives on a two-day visit to India today, 10 December 2014, for the 15th Annual India-Russia Summit. Ahead of his visit, India's Ministry of External Affairs on 5 December 2014 said that the Summit will have a strong focus on redefining the economic partnership between the two countries. Several documents are under preparation for signing at the Summit, in the fields of defence, nuclear energy, customs, banking and energy, the Ministry of External Affairs said had said at that time. India is keenly interested in participating in more hydrocarbon projects in Russia, the Ministry of External Affairs said on 5 December 2014. India has said clearly that it cannot be party to any sanctions against Russia, the Ministry of External Affairs said on 5 December 2014.
The Ministry of Urban Development yesterday, 9 December 2014, said that a ten member all Party Parliamentary delegation from Romania which is currently on a six day visit to India has expressed the desire to enhance Romania's engagement with India in Parliamentary and economic spheres. At a meeting between Parliamentary Affairs Minster M.Venkaiah Naidu and Valeriu Stefan Zgone, President of the Chambers of Deputies, Parliament of Romania, it was felt that the present level of bilateral trade of about $666 million between India and Romania is inadequate to the potential and need to be increased by identifying new areas of cooperation for mutual benefit, the Ministry of Urban Development said. Naidu is also the Minister of Urban Development.
The government will unveil industrial production data for October 2014 on Friday, 12 December 2014. Industrial production growth improved to 2.5% in September 2014, from a revised 0.5% growth in August 2014.
The government will release annual rate of inflation based on the combined consumer price indices (CPI) for urban and rural India for November 2014 on Friday, 12 December 2014. CPI for urban and rural India eased to 5.52% in October 2014, from 6.46% in September 2014.
The government will release the inflation data based on wholesale price index (WPI) for November 2014 on 15 December 2014. WPI eased to 1.77% in October from 2.38% in September 2014.
Asian markets edged lower today, 10 December 2014, amid political uncertainty in Greece after the European nation's surprise elections announcement yesterday, 9 December 2014. Key indices in Hong Kong, Taiwan, Japan, and South Korea were off 0.17% to 2.37%. Key indices in China, Singapore and Indonesia were up 0.26% to 0.39%.
China's annual consumer inflation eased to a five-year low of 1.4% in November, signalling persistent weakness in the world's second-largest economy and giving policymakers more room to ease policy to support growth. The consumer price index fell 0.2% in November from October, the National Bureau of Statistics said today, 10 December 2014.
Trading in US index futures indicated that the Dow could fall 17 points at the opening bell today, 10 December 2014. The US stock market staged a rebound yesterday, 9 December 2014, but still ended the day lower, even after erasing steep opening losses sparked by China's tightening of lending rules and Greece's surprise elections announcement. Overseas news overshadowed speculation that the Federal Reserve may be close to pulling back its pledge to keep rates low, with yields falling amid a flight to quality.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 16-17 December 2014. The policy meeting will be keenly watched for any hints on the timing of interest rate increases in the world's biggest economy.
In Europe, Greece has brought forward to this month the date of its next presidential election, which is conducted by the country's parliament. The announcement yesterday, 9 December 2014, came after eurozone ministers approved a Greek request for a two-month extension to its bailout programme, due to end later this month. The presidential vote on 17 December will be a vital test for embattled Prime Minister Antonis Samaras.
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