Key benchmark indices trimmed gains in afternoon trade. The barometer index, the S&P BSE Sensex, was up 366.75 points or 1.49%, off 115.12 points from the day's high and up 147.53 points from the day's low. The market breadth indicating the overall health of the market was strong. Indian stocks surged today, 26 May 2014, on speculation Narendra Modi will choose a cabinet capable of reviving economic growth. Modi takes oath as Prime Minister today, 26 May 2014, evening. As per reports, the Modi led government will have smaller cabinet, with one cabinet member heading a cluster of ministries. The focus is to increase coordination between different government departments and facilitate rapid decision-making. Media reports suggested that Arun Jaitley, 61, a former trade minister, is the frontrunner to become finance minister even though he failed to win a seat in the lower house of parliament.
Steel stocks were in demand, with Steel Authority of India (Sail), Tata Steel, Jindal Steel & Power and JSW Steel hitting 52-week high. Among non-ferrous metal stocks, Sesa Sterlite hit 52-week high. Hindustan Zinc hit record high. Among banking stocks, private sector Axis Bank hit record high. State-run Punjab National Bank (PNB) hit 52-week high. Power Grid Corporation of India hit 52-week high.
Indian stocks surged in early trade ahead of Prime Minister designate Narendra Modi's swearing in ceremony today, 26 May 2014, evening. Firmness continued on the bourses in morning trade. Key benchmark indcies extended gains and hit fresh intraday high in mid-morning trade. The Sensex hit over one-week high above the psychological 25,000 level. The 50-unit CNX-Nifty also hit its highest level in more than a week. Key benchmark indices trimmed gains after hitting fresh intraday high in early afternoon trade. Key benchmark indices further trimmed gains in afternoon trade.
The market sentiment was boosted by data showing that foreign funds were net buyers of Indian stocks on Friday, 23 May 2014. Foreign institutional investors (FIIs) bought shares worth a net Rs 416.80 crore on Friday, 23 May 2014, as per provisional data from the stock exchanges.
The market may remain volatile this week as traders roll over positions in the futures & options (F&O) segment from the near month May 2014 series to June 2014 series. The near month May 2014 derivatives contract expire on Thursday, 29 May 2014.
At 13:20 IST, the S&P BSE Sensex was up 366.75 points or 1.49% to 25,060.10. The index surged 481.87 points at the day's high of 25,175.22 in early afternoon trade, its highest level since 16 May 2014. The index rose 219.22 points at the day's low of 24,912.57 in early trade.
The CNX Nifty was up 99.20 points or 1.35% to 7,466.30. The index hit a high of 7,504 in intraday trade, its highest level since 16 May 2014. The index hit a low of 7,428.55 in intraday trade.
The BSE Mid-Cap index was up 63.09 points or 0.73% at 8,731.41. The BSE Small-Cap index was up 71.08 points or 0.78% at 9,199.12. Both these indices underperformed the Sensex.
The market breadth indicating the overall health of the market was strong. On BSE, 1,849 shares gained and 1,049 shares fell. A total of 96 shares were unchanged.
The total turnover on BSE amounted to Rs 3890 crore by 13:20 IST.
Among the 30-share Sensex pack, 23 stocks gained and rest of them declined. Mahindra & Mahindra (M&M) (up 7.3%), L&T (up 6.17%) and Bharat Heavy Electricals (Bhel) (up 4.33%) edged higher from the Sensex pack.
State Bank of India (down 1.19%), Cipla (down 0.83%) and Bharti Airtel (down 0.67%) edged lower from the Sensex pack.
Steel stocks were in demand. Steel Authority of India (Sail) surged 6.93% to Rs 96.50 after hitting 52-week high of Rs 100.85 in intraday trade.
Tata Steel rose 1.82% to Rs 486.20 after hitting 52-week high of Rs 494.90 in intraday trade.
Jindal Steel & Power rose 2.88% to Rs 309.40 after hitting 52-week high of Rs 315 in intraday trade.
JSW Steel rose 0.17% to Rs 1,265.70 after hitting 52-week high of Rs 1,295 in intraday trade.
Among other mining and metal stocks, NMDC (up 1.18%) and Hindustan Copper (up 1.21%) edged higher. Hindalco Industries shed 1.09%.
Sesa Sterlite rose 1.81% to Rs 272.70 after hitting 52-week high of Rs 275 in intraday trade.
Hindustan Zinc rose 0.74% to Rs 162.75 after hitting record high of Rs 166 in intraday trade.
National Aluminium Company fell 2.82% to Rs 56.80, with the stock reversing direction after hitting 52-week high of Rs 60.30 in intraday trade.
Punjab National Bank (PNB) rose 1.31% to Rs 1,048.65 after hitting 52-week high of Rs 1,068 in intraday trade.
Axis Bank rose 2.56% to Rs 1,912.65 after hitting record high of Rs 1,927.30 in intraday trade.
Power Grid Corporation of India rose 0.34% to Rs 131.10 after hitting 52-week high of Rs 135 in intraday trade.
Engineers India fell 2.16% after net profit fell 42.69% to Rs 103.55 crore on 7.61% decline in total income to Rs 571.61 crore in Q4 March 2014 over Q4 March 2013. The result was announced after market hours on Friday, 23 May 2014.
Narendra Modi will be sworn in as India's next Prime Minister today, 26 May 2014, evening at the Rashtrapati Bhawan.
After Bharatiya Janata Party (BJP) led National Democratic Alliance's (NDA) landslide victory in the Lok Sabha election, investors are expecting measures from the incoming government to revive the Indian economy. India's GDP growth slowed sharply at 4.7% in Q3 December 2013. Investors hope that the BJP-led government would be able to accelerate policy reforms and overhaul the country's poor infrastructure.
Modi is favored by business leaders because of his record in Gujarat, which he's led since 2001. With Modi at the helm of affairs, Gujarat's economy expanded by 10.1% a year, on average and adjusting for inflation, from 2001 and 2012, compared with 7.7% growth a year for India's economy as a whole.
Modi has pledged to fight inflation by cracking down on food hoarders, creating a national agriculture market and improving rural infrastructure.
Ever since NDA's victory in the election, speculation has been rife about the likely allocation of key ministerial portfolios in the Modi-led NDA government.
The first budget of the new government is expected by July 2014. An interim budget was presented by P. Chidambaram in February this year. Essentially, in the nature of a vote on account, the interim budget was intended to get Parliament approval for expenditure to be incurred during the first few months of fiscal year 2014-15 due to Lok Sabha elections.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014, as consumer-price inflation eased to a two-year low and as the rupee firmed up against the dollar.
European stocks edged higher on Monday, 26 May 2014. Key benchmark indices in Germany and France were up 0.4% to 0.97%. The stock market in UK was closed for a holiday.
German consumer confidence is due to stabilize at a high level in June, suggesting that the continuing tension in Ukraine has yet to have a noticeable impact on German consumer sentiment. The Nuremberg-based GfK institute's forward-looking indicator is due to be 8.5 in June, the group reported Monday, matching the previous month.
Asian stocks rose on Monday, 26 May 2014, after China's premier said policy will be fine tuned as needed to support the economy. Key benchmark indices in China, Taiwan, Singapore, Hong Kong and Japan were up 0.03% to 0.97%. Key benchmark indices in Indonesia and South Korea were off 0.19% to 0.34%.
China's Premier Li Keqiang said Asia's largest economy will adjust policy to address problems in the real economy, according to a statement on the government's website May 23.
Bank of Japan policy makers said the economy will probably grow above potential from summer, according to the minutes released today from an April 30 meeting.
Japan and China on Sunday accused each other's air forces of dangerous behaviour over the East China Sea, with Japan saying Chinese aircraft had come within a few dozen metres of its warplanes.
US stock markets remain closed today, 26 May 2014, on account of Memorial Day.
US stocks edged higher on Friday, 26 May 2014, with the S&P 500 index closing at a record high, buoyed by a rally in housing stocks after better-than-expected home sales and a jump in Hewlett-Packard shares a day after the personal computer maker said it would cut more jobs.
Data from the Commerce Department showed sales of new US single-family homes rose more than expected in April and the supply of houses on the market hit a 3-1/2 year high.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 17-18 June 2014. The Fed on 30 April 2014 said after a monetary policy review that it will keep the benchmark interest-rate target at almost zero for a "considerable time" after its bond-buying program ends. The FOMC also reduced monthly debt purchases to $45 billion, its fourth straight $10 billion cut, and said further reductions are likely in "measured steps" if the economy continues to improve.
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