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Telecom stocks advance on TRAI's proposal to cut reserve prices

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Last Updated : Sep 10 2013 | 11:55 PM IST

Key benchmark indices surged in morning trade as the rupee rose to a two-week high against the dollar on receding geopolitical risks from Syria. Gains in Asian stocks also underpinned sentiment. The barometer index, BSE Sensex, hit over six-week high. The CNX Nifty hit six-week high. The S&P BSE Sensex was up 524 points or 2.72%, up 349.40 points from the day's low and off 19.86 points from the day's high. The market breadth, indicating the overall health of the market, was strong.

Index heavyweight and cigarette maker ITC gained. Reliance Industries rose. Tata Motors hit record high. Telecom stocks gained after the sector regulator on Monday, 9 September 2013, reportedly recommended sharp cuts in reserve prices for the next round of spectrum auctions.

Key benchmark indices rallied in early trade on firm Asian cues. The stock market had remained closed on Monday, 9 September 2013, on account of Ganesh Chaturthi. Key benchmark indices surged in morning trade as the rupee rose to a two-week high on receding geopolitical risks from Syria. The barometer index, BSE Sensex, hit over six-week high. The CNX Nifty hit six-week high.

The market sentiment was boosted by data showing that foreign funds remained net buyers of Indian stocks on Friday, 6 September 2013. Foreign institutional investors (FIIs) bought shares worth a net Rs 800.71 crore on Friday, 6 September 2013, as per provisional data from the stock exchanges.

In the foreign exchange market, the rupee rose to a two-week high on Tuesday as receding geopolitical risks from Syria and strong exports in August helped lift the currency. The partially convertible rupee was hovering at 64.25, stronger than its close of 65.24/25.on Friday, 6 September 2013. Financial markets were closed on Monday, 9 September 2013, on account of Ganesh Chaturthi.

At 10:21 IST, the S&P BSE Sensex was up 524 points or 2.72% to 19,794.06. The index surged 543.86 points at the day's high of 19,813.92 in morning trade, its highest level since 26 July 2013. The index gained 174.60 points at the day's low of 19,444.66 in early trade.

The CNX Nifty was up 162 points or 2.85% to 5,842.40. The index hit a high of 5,847.20 in intraday trade, its highest level since 30 July 2013. The index hit a low of 5,738.20 in intraday trade.

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The market breadth, indicating the overall health of the market, was strong. On BSE, 954 shares gained and 299 shares fell. A total of 41 shares were unchanged.

The total turnover on BSE amounted to Rs 583 crore by 10:20 IST compared to Rs 140 crore by 09:25 IST.

Among the 30-share Sensex pack, 27 stocks gained and only three of them declined. HDFC (up 4.86%), L&T (up 4.19%) and Maruti Suzuki India (up 2.94%) edged higher from the Sensex pack.

Tata Motors jumped 6.42% to Rs 338.20 after striking a record high of Rs 338.30 in intraday trade today, 10 September 2013. It was the top gainer from the Sensex pack.

Index heavyweight and cigarette maker ITC gained 2.85%.

Reliance Industries rose 0.97% to Rs 877.

Telecom stocks gained after the sector regulator on Monday, 9 September 2013, reportedly recommended sharp cuts in reserve prices for the next round of spectrum auctions.

Bharti Airtel (up 4.99%), Idea Cellular (up 4.17%), MTNL (up 3.06%), Tata Teleservices (Maharashtra) (up 2%) and Reliance Communications (up 1.97%) gained.

According to reports, TRAI slashed the combined spectrum auction reserve price in the premium 900 MHz band in the circles of Delhi, Mumbai and Kolkata by about 79% to Rs 650 crore per MHz against Rs 3074.18 crore per MHz earlier.

It reportedly recommended an about 60% cut in the pan-India reserve price for the 2G spectrum (1800 MHz) auctions compared to its previous suggestions.

The Telecom Regulatory Authority of India (TRAI) also said no spectrum would be reserved for existing players when their licences expire and suggested that airwaves can be traded, reports suggested.

The Reserve Bank of India said on Thursday, 5 September 2013 that it will release the next Mid-Quarter Review of Monetary Policy 2013-14 at 11 IST on 20 September 2013 instead of 18 September 2013 as indicated in the First Quarter Review of Monetary Policy 2013-14. This will be followed by Governor Dr. Raghuram Rajan addressing the media in the afternoon.

Asian stocks hit three-month high on Tuesday ahead of a fresh round of Chinese economic data and signs that Syrian tensions are easing. Key benchmark indices in China, Hong Kong, Indonesia, South Korea, Singapore and Japan rose by 0.14% to 2.06%. Taiwan's Taiwan Weighted index shed 0.35%.

Trading in US index futures indicated that the Dow could gain 14 points at the opening bell on Tuesday, 10 September 2013. US markets ended higher on Monday, helped in part by hopes that the threat of a US military intervention in the Middle East could be abating.

Russia on Monday proposed to work with Damascus to put its chemical weapons under international control, a move that President Barack Obama said could be "potentially positive".

Investors across the globe are eyeing the next policy meeting of the Federal Open Market Committee (FOMC) scheduled this month, with their focus squarely on the timing of tapering of Federal Reserve's bond purchases. The FOMC holds a two-day policy meeting on 17-18 September 2013 to decide on interest rates in the United States. The US central bank currently buys $85 billion a month in US debt and mortgage-backed securities in a bid to hold interest rates low and encourage economic growth. Federal Reserve Chairman Ben Bernanke has on several occasions stressed that the tapering process is dependent on an improvement in data. Fed's bond-buying program has kept global markets flush with liquidity in recent years.

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First Published: Sep 10 2013 | 10:28 AM IST

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