Firmness continued on the domestic bourses in afternoon trade as most European stocks opened higher. The rupee's surge against the dollar boosted sentiment on the domestic bourses today, 3 October 2013. The S&P BSE Sensex was up 296.17 points or 1.52%, up close to 229 points from the day's low and off about 25 points from the day's high. The market breadth, indicating the overall health of the market, was strong. Asian and European shares were mostly in green following an encouraging reading on non-manufacturing activity in China.
Indian stocks got additional boost from expectations that the US government's partial shutdown could lead to the US Federal Reserve postponing tapering of monetary stimulus to the US economy. The US government's partial shutdown has sparked concern it will slow economic growth in the world's biggest economy. ADP's report on Wenesday, 2 October 2013, of weaker-than-expected growth in US private-sector jobs in September also fuelled expectations that the Fed will hold off on reducing the amount of monetary stimulus in the near future. Boston Fed President Eric Rosengren, a consistent backer of record stimulus who votes on policy this year, said on Wednesday, 2 October 2013, that the central bank refrained from tapering its bond purchases last month because growth was lower than forecast and fiscal policy posed a risk to the outlook. The Federal Open Market Committee (FOMC) holds a two-day policy meeting on 29-30 October 2013. On 18 September 2013, the Fed surprised economists and investors with its decision to delay scaling back its stimulus amid concerns about the strength of the economic recovery. Fed's bond-buying program has been a source of liquidity for most Asian and emerging markets this year.
Tata Communications extended Tuesday's gains triggered by an announcement early this week that Vodacom and the shareholders of Neotel have entered into exclusive discussions regarding a potential acquisition of 100% of the shares of Neotel by Vodacom SA. Tata Communications has a strategic investment in Neotel. Shares of cellular services provider Idea Cellular hit a record high. Index heavyweight Reliance Industries (RIL) extended intraday gains.
The market edged higher in early trade on firm Asian stocks. The market extended initial gains and hit fresh intraday high in morning trade. The market strengthened further and hit fresh intraday high in mid-morning trade. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit their highest level in almost a week. Firmness continued on the bourses in early afternoon trade. Firmness continued on the bourses in afternoon trade.
In the foreign exchange market, the rupee strengthened against the dollar tracking global dollar weakness. The partially convertible rupee was hovering at 61.9250, compared with its close of 62.46/47 on Tuesday, 1 October 2013. Indian financial markets were closed on Wednesday, 2 October 2013, on account of Mahatma Gandhi Jayanti.
At 13:15 IST, the S&P BSE Sensex was up 296.17 points or 1.52% to 19,813.32. The index jumped 320.80 points at the day's high of 19837.95 in afternoon trade, its highest level since 27 September 2013. The index gained 66.82 points at the day's low of 19,583.97 in early trade.
The CNX Nifty was up 104.95 points or 1.82% to 5,885. The index hit a high of 5,891.75 in intraday trade, its highest level since 27 September 2013. The index hit a low of 5,802.70 in intraday trade.
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The market breadth, indicating the overall health of the market, was strong. On BSE, 1,367 shares rose and 827 shares fell. A total of 151 shares were unchanged.
Among the 30-share Sensex pack, 26 stocks rose. Sesa Sterlite (up 6.75%), Tata Steel (up 4.41%), TCS (up 4.30%), Jindal Steel & Power (up 3.61%), Wipro (up 3.45%), Hindalco Industries (up 3.12%), Tata Motors (up 3.04%), Bajaj Auto (up 2.92%), Maruti Suzuki India (up 2.70%) and Tata Power (up 2.63%), edged higher from the Sensex pack.
Hindustan Unilever (down 1.70%), ITC (down 1.24%), Bharti Airtel (down 0.45%) and NTPC (down 0.10%), edged lower from the Sensex pack.
Index heavyweight RIL rose 2.30% to Rs 841.20, with the stock extending intraday gains.
Tata Communications extended Tuesday's gains triggered by an announcement early this week that Vodacom and the shareholders of Neotel have entered into exclusive discussions regarding a potential acquisition of 100% of the shares of Neotel by Vodacom SA. The stock was up 4.15% at Rs 210.90. The stock had jumped 7.65% to settle at Rs 202.50 on Tuesday, 1 October 2013. Tata Communications has a strategic investment in Neotel.
Vodacom is an African mobile communications company providing voice, messaging, data and converged services to around 50 million active customers, Vodacom is majority owned by Vodafone, one of the world's largest mobile communications companies by revenue. Vodacom is listed on the JSE and its head office is in Johannesburg, South Africa.
Neotel is South Africa's first converged communications network operator. It provides a range of value-added voice, internet and data services for businesses, wholesale network operators and providers and retail customers using its IP Next Generation Network, powered by Neotel's high-performance fibre optic backbone. Neotel connects the major centres in South Africa to each other and to the world, directly linking its infrastructure into Tata Communications' global Tier 1 network.
Separately, Tata Communications announced on Wednesday, 2 October 2013, that it launched its mobile messaging exchange service. The exchange will enable over-the-top (OTT) providers and SMS aggregators to connect to a large community of MNOs globally, while allowing MNOs to monetise the SMS traffic with an added layer of security. This service provides a mutually favourable and profitable solution for all the stakeholders in the value chain, the company said in a statement.
Shares of cellular services provider Idea Cellular rose 1.01% to Rs 175.25 after hitting a record high of Rs 178.35 in intraday today, 3 October 2013.
Bank of India jumped 4.1% to Rs 172.60. The state-run bank after market hours on Tuesday, 1 October 2013, said that the bank has completed the allotment of Rs 500-crore BASEL-III compliant unsecured Tier-II Bonds of 10 years at a coupon rate of 9.8% per annum on private placement basis. The state-run bank also clarified that the present issue is in addition to the earlier issue of Rs 1000 crore completed on 25 September 2013. Both the issues have been rated AAA by CRISIL, the bank said.
HDIL (up 6.15%), Axis Bank (up 5.69%), Jaiprakash Associates (up 5.56%), Zee Entertainment Enterprises (up 5.32%) and Bharat Forge (up 5.10%), were among the major gainers from the BSE's 'A' group.
Most European stocks advanced in early trade on Thursday, 3 October 2013, as a gauge of China's services industry rose to a six-month high. Key benchmark indices in Germany and UK were up 0.21% to 0.27%. However, France's CAC 40 was down 0.13%.
The European Central Bank kept its benchmark interest rate unchanged at a record low on Wednesday, 2 October 2013, as the euro area recovers from its longest-ever recession. The Governing Council meeting in Paris on 2 October 2013 left the main refinancing rate at 0.5% for a fifth month after cutting it by a quarter point in May. The central bank was "particularly attentive" to any moves in market rates which could threaten economic recovery or push inflation too low, Mario Draghi told a news conference.
In Italy, Silvio Berlusconi said he would back the government of Prime Minister Enrico Letta in a confidence vote on Wednesday, a surprise move that has allowed the coalition government to avoid a collapse.
Most Asian shares turned higher on Thursday, 3 October 2013, shaking off a weak start following an encouraging reading on non-manufacturing activity in China. Key benchmark indices in Hong Kong, Taiwan and Indonesia rose 0.52% to 1.73%. Key benchmark indices in Japan and Singapore fell 0.09% to 0.18%. Markets in South Korea were closed for the National Foundation Day holiday. Markets in mainland China are closed till 7 October 2013 for National Day holidays.
China's official non-manufacturing Purchasing Managers' Index rose to a six-month high of 55.4 in September from 53.9 in August, adding to a growing roster of evidence that China's economy has turned a corner in recent months.
The Philippines won a rating upgrade from Moody's Investors Service, completing the nation's ascent to investment rank as President Benigno Aquino leads a growth resurgence that's outpacing the rest of Southeast Asia. The rating on the nation's government debt was raised one level to Baa3, Moody's said in a statement today. The outlook on the rating is positive. The upgrade puts the Philippines on par with Turkey and Spain.
Trading in US index futures indicated that the Dow could fall 20 points at the opening bell on Thursday, 3 October 2013. US stocks fell on Wednesday as investors watched for progress on ending an impasse over federal spending that shut down the government a second day. The US government has been in partial shutdown for two days after lawmakers failed to agree on a federal budget.
A meeting between President Barack Obama and congressional leaders ended Wednesday night with no deal to re-open the US government. House Speaker John Boehner told reporters that Obama repeated he wouldn't negotiate about passing a funding bill. With the Senate gaveled out for the day, the stalemate continued and meant the government shutdown would continue for a third day on Thursday.
A report showed companies added fewer workers than projected in September, indicating the job market is struggling to gain momentum. The 166,000 increase in employment followed a revised 159,000 rise in August that was smaller than initially estimated, according to the ADP Research Institute in Roseland, New Jersey.
Meanwhile, the US is creeping up against its debt limit. Treasury Secretary Jack Lew on Tuesday night reiterated that the government will lose the ability to borrow on Oct. 17.
The Federal Open Market Committee (FOMC) holds a two-day policy meeting on 29-30 October 2013. On 18 September 2013, the Fed surprised economists and investors with its decision to delay scaling back its stimulus amid concerns about the strength of the economic recovery.
Moody's Investors Service lowered its outlook on Brazil's sovereign rating to stable from positive, citing deteriorating debt and investment ratios and evidence the economy is going through a low-growth period. "Even though there are signs that the Brazilian economy may be starting to recover, Moody's view is that, if and when the upturn materializes, it is unlikely that it will be strong enough to restore a positive trend in Brazil credit metrics," Moody's said in a statement dated 2 October 2013. Moody's affirmed Brazil's Baa2 government bond rating.
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