Key benchmark indices regained strength in mid-afternoon trade. The Sensex, was up 236.61 points or 1.12%, off close to 15 points from the day's high and up about 180 points from the day's low. The market sentiment was boosted after data showed inflation based on the wholesale price index (WPI) eased to five-month low at 6.16% in December 2013. Easing inflation provided legroom for the central bank to cut interest rates in order to perk up slowing growth. Firmness in Asian and European stocks also boosted sentiment. The market breadth, indicating the overall health of the market, was positive. Twelve out of thirteen sectoral indices on BSE were in the green.
Bank stocks gained after data showed inflation based on the wholesale price index (WPI) eased to 6.16% in December 2013. Yes Bank rose on good Q3 result.
The market edged higher in early trade. Firmness continued on bourses in morning trade. It extended gains and hit fresh intraday high in mid-morning trade. It hit fresh intraday high in early afternoon trade. Key benchmark indices pared gains in afternoon trade. It regained strength in mid-afternoon trade.
Asian and European stocks rose on Wednesday on optimism the global economy is strengthening.
At 14:20 IST, the S&P BSE Sensex was up 236.61 points or 1.12% to 21,269.49. The index rose 252.91 points at the day's high of 21,285.79 in early afternoon trade, its highest level since 2 January 2014. The index gained 58.58 points at the day's low of 21,091.46 in opening trade.
The CNX Nifty was up 70.85 points or 1.14% to 6,312.70. The index hit a high of 6,316.70 in intraday trade, its highest level since 2 January 2014. The index hit a low of 6,265.30 in intraday trade.
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The market breadth, indicating the overall health of the market, was positive. On BSE, 1,253 shares gained and 1,239 shares fell. A total of 154 shares were unchanged.
Among the 30 Sensex shares, 29 shares rose and only one fell. L&T (up 2.94%), Coal India (up 2.17%), and Hindalco Industries (up 1.96%) edged higher from the Sensex pack.
Bank stocks gained after data showed inflation based on the wholesale price index (WPI) eased to 6.16% in December 2013. HDFC Bank (up 0.88%) and ICICI Bank (up 2.41%) gained.
Among other PSU bank stocks, State Bank of India, Canara Bank, Union Bank of India, Bank of India, Bank of Baroda and Punjab National Bank rose 1.01% to 2.2%.
AXIS Bank fell 0.27%. The bank unveils Q3 results on Thursday, 16 January 2014.
Yes Bank rose 0.82% on good Q3 result. The bank's net profit rose 21.4% to Rs 415.60 crore on 17.4% growth in total net income to Rs 1053.30 crore in Q3 December 2013 over Q3 December 2012. Yes Bank's net-interest income (NII) rose 13.9% to Rs 665.40 crore in Q3 December 2013 over Q3 December 2012, on account of a cautious and steady growth in advances. Non-interest income rose 23.9% to Rs 387.90 crore in Q3 December 2013 over Q3 December 2012, on the back of continued growth across all fee income streams, Yes Bank said. The bank's net interest margin (NIM) declined to 2.9% from 3% in Q3 December 2012.
Yes Bank's operating profit rose 9.1% to Rs 614.70 crore in Q3 December 2013 over Q3 December 2012, driven by stable growth in NII and non-interest income
Yes Bank's current and savings account (CASA) surged 37.8% YoY to Rs 14246.10 crore taking the CASA ratio to 20.9% as on 31 December 2013, up from 18.3% as on 31 December 2012. Yes Bank said it continues to demonstrate strong traction in CASA on the back of an increase in branch network, enhanced savings rate offering and improvements in productivity, Yes Bank said in a statement.
The bank's gross non-performing advances as a proportion of gross advances was at 0.39% as on 31 December 2013 while net non-performing advances as a proportion of net advances was at 0.08% as at 31 December 2013. Bank's specific loan provision coverage ratio was at 78.4% as on 31 December 2013 (excluding counter cyclical provision). Total counter cyclical provision stood at 0.4% of advances, Yes Bank said.
As per Basel III, Tier I capital stood at 9.9% and total CRAR stood at 16.1% (including nine-months FY 2014 profits, adjusted for prorated dividend) with CET ratio at 9.3% as at 31 December 2013, Yes Bank said.
Commenting on the results, Mr. Rana Kapoor, MD, Yes Bank said, "Yes Bank has delivered a satisfactory quarter of financial performance despite a challenging economic environment. During this year, Yes Bank has further invested in its branch network, which is generating increasing granular and CASA deposits. The bank has maintained NIMs and delivered consistent RoA and RoEs despite the tightening interest rate environment. The bank continues to generate satisfactory returns resulting in improving core Tier I as per Basel III norms. Yes Bank has recently received approval from the UAE Central Bank (previously from RBI) to set up a representative office in Abu Dhabi, UAE which will be the bank's maiden international beginning".
Bajaj Finance rose 0.3% after net profit surged 21% to Rs 194 crore on 31% growth in total income to Rs 1082 crore in Q3 December 2013 over Q3 December 2012. The Q3 result was announced during trading hours today, 15 January 2014.
Bajaj Finance said that without the accelerated provisioning of Rs 21 crore in Q3 December 2013 made to strengthen the company's provisioning framework, the profit after tax (PAT) would have been at Rs 208 crore in Q3 December 2013, a YoY growth of 30%.
Bajaj Finance's net interest income (NII) jumped 33% to Rs 672 crore in Q3 December 2013 over Q3 December 2012.
The company's loan losses and provisions rose 55% to Rs 79 crore in Q3 December 2013 over Q3 December 2012. Without the accelerated provisioning of Rs 21 crore, the increase in loan losses for Q3 December 2013 would have been 14% YoY, Bajaj Finance said in a statement.
Gross non-performing assets (NPAs) ratio stood at 1.15% as on 31 December 2013. Net NPA ratio stood at 0.23% as on 31 December 2013. The provisioning coverage ratio stood at 80% as at 31 December 2013. Bajaj Finance said it continues to provide for loan losses in excess of RBI requirements.
Capital Adequacy Ratio (CAR) (including Tier-II capital) stood at 19.53% as on 31 December 2013. The company continues to be well capitalized to support its growth trajectory, Bajaj Finance said in a statement.
The company's total assets under management (AUM) rose 33% to Rs 22461 crore as on 31 December 2013, from Rs 16844 crore as on 31 December 2012.
Inflation based on the wholesale price index (WPI) eased to 6.16% in December 2013 as compared to 7.52% (provisional) for the previous month and 7.31% during the corresponding month of the previous year. Build up inflation rate in the financial year so far was 5.35% compared to a build up rate of 4.84% in the corresponding period of the previous year. Index for October 2013 revised upwards to 7.24% as compared to earlier reported 7%.
The Reserve Bank of India's Third Quarter Review of Monetary Policy for 2013-14 is scheduled on 28 January 2014. The Reserve Bank of India kept its main lending rate viz. the repo rate unchanged after its last policy review in December and said at that time that it expected inflation to ease in the following months.
European stocks climbed on Wednesday on speculation the global economy is strengthening. Key benchmark indices in France, Germany and UK rose 0.3% to 0.78%.
Germany's economy expanded less than forecast last year even as it led the euro area out of the region's longest-ever recession. Gross domestic product increased 0.4% from 2012, when it gained 0.7%, the Federal Statistics Office said in Berlin today.
Asian stocks rose on Wednesday on optimism the global economy is strengthening. Key benchmark indices in Hong Kong, Indonesia, Japan, Singapore, South Korea and Taiwan were up 0.37% to 2.5%. China's Shanghai Composite fell 0.17%.
Trading in US index futures indicated that the Dow could gain 23 points at the opening bell on Wednesday, 15 January 2014. US stocks rose on Tuesday, giving the Standard & Poor's 500 Index its biggest gain of the year, as better-than-forecast retail sales and corporate merger activity signaled confidence in the economy.
US retail sales increased 0.2% after a 0.4% advance in November, Commerce Department figures showed in Washington.
Philadelphia Fed President Charles Plosser said that the central bank's stimulus program should end later this year because the economy is on a "firmer footing" than it has been in the past several years. Richard Fisher, Fed president in Dallas, likened quantitative easing to "beer goggles" that makes everything look good. There are signs that "we have made for an intoxicating brew as we have continued pouring liquidity down the economy's throat," he said in a speech.
The Federal Open Market Committee (FOMC) holds a two-day monetary policy meeting on 28 and 29 January 2014. By a 9-to-1 vote, the Fed on 18 December 2013 decided to trim its asset-purchase program by $10 billion to $75 billion per month starting in January 2014.
The World Bank raised its global growth forecasts as the easing of austerity policies in advanced economies supports their recovery, boosting prospects for developing markets' exports. The Washington-based lender sees the world economy expanding 3.2% this year, compared with a June projection of 3 percent and up from 2.4% in 2013. The forecast for the richest nations was raised to 2.2% from 2%. Part of the increase reflects improvement in the 18-country euro area, with the US ahead of developed peers, growing twice as fast as Japan. The report by the institution that's trying to eradicate extreme poverty by 2030 indicates a near-doubling of the growth in world trade this year from 2012, as developed economies lift export-reliant emerging nations. At the same time, the withdrawal of monetary stimulus in the US may raise market interest rates, hurting poorer countries as investors return to assets such as Treasuries, according to the bank.
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