Volatility was the order of the day as key benchmark indices regained positive zone soon after a sudden slide in mid-morning trade. The high volatility in mid-morning trade materialized the Reserve Bank of India (RBI) kept its main lending rate viz. the repo rate unchanged after a monetary policy review and announced a reduction in the statutory liquidity ratio (SLR) of scheduled commercial banks by 50 basis points with effect from the fortnight beginning 7 February 2015 in order to create space for banks to expand credit to the productive sectors so as to support investment and growth in the economy. The barometer index, the S&P BSE Sensex, was currently up 44.47 points or 0.15% at 29,166.74. The market breadth indicating the overall health of the market was positive.
Bank stocks were mixed after the RBI announced a reduction in the statutory liquidity ratio (SLR) of scheduled commercial banks by 50 basis points (bps) with effect from the fortnight beginning 7 February 2015 in order to create space for banks to expand credit to the productive sectors so as to support investment and growth in the economy.
Foreign portfolio investors sold shares worth a net Rs 629.97 crore yesterday, 2 February 2015, as per provisional data.
In the overseas makets, Asian stocks were mixed. US stocks ended sharply higher yesterday, 2 February 2015, after a late rally driven by hopes for a Greek debt deal and as energy shares bounced with oil prices.
In the foreign exchange market, the rupee edged higher against the dollar.
Brent crude oil futures extended gains registered during the previous trading session.
At 11:18 IST, the S&P BSE Sensex was up 44.47 points or 0.15% at 29,166.74. The index fell 98.98 points at the day's low of 29,023.29 in mid-morning trade. The index jumped 130.79 points at the day's high of 29,253.06 in early trade.
The CNX Nifty was up 26.15 points or 0.3% at 8,823.55. The index hit a low of 8,768.20 in intraday trade. The index hit a high of 8,837.30 in intraday trade.
The BSE Mid-Cap index was up 58.34 points or 0.54% at 10,857.47. The BSE Small-Cap index was up 37.49 points or 0.33% at 11,494.33. Both these indices outperformed the Sensex.
The market breadth indicating the overall health of the market was positive. On BSE, 1,285 shares gained and 1,013 shares fell. A total of 96 shares were unchanged.
Bank stocks were mixed after the RBI announced a reduction in the statutory liquidity ratio (SLR) of scheduled commercial banks by 50 basis points with effect from the fortnight beginning 7 February 2015 in order to create space for banks to expand credit to the productive sectors so as to support investment and growth in the economy. Among public sector banks, Allahabad Bank (down 0.95%), Andhra Bank (down 0.8%), Bank of India (down 0.35%), Corporation Bank (down 0.29%), Indian Overseas Bank (down 1.45%), IDBI Bank (down 0.49%), Punjab National Bank (down 1.8%), Syndicate Bank (down 1.17%), and UCO Bank (down 0.91%) edged lower. Union Bank of India (up 0.33%), United Bank of India (up 0.72%), Vijaya Bank (up 0.1%), Bank of Baroda (up 0.08%), Central Bank of India (up 0.19%), Bank of Maharashtra (up 0.48%), Dena Bank (up 0.62%), Oriental Bank of Commerce (up 0.51%) edged higher.
State Bank of India (SBI) rose 0.6% at Rs 309.65. Reliance Industries rose 2.07% at Rs 926.65. SBI and Reliance Industries (RIL) said in a joint statement issued after market hours yesterday, 2 February 2015, that RIL has applied for a Payments Bank license. RIL will be the promoter and State Bank of India (SBI) will be the joint venture partner with equity investment of upto 30%. The payments bank will leverage SBI's nationwide distribution network and risk management capabilities alongwith the substantial investments made by RIL in its retail and telecom businesses, the two companies said in a press release. It will deploy state-of-the-art technology, build scalable infrastructure and create extensive branch and business correspondent network in order to provide last-mile access and intuitive user experience to all sections of society, the press release added.
Canara Bank fell 0.19% at Rs 453.90. The stock hit a high of Rs 461.35 and a low of Rs 448.85 so far during the day. The bank after market hours yesterday, 2 February 2015, said that as per the powers delegated by the Board of the bank, the Bond Committee, during the course of its meeting held on 2 February 2015, decided to raise additional Tier- I instruments amounting to Rs 1500 crore through issue of BASEL-III complaint additional Tier-I perpetual bonds by way of private placement.
Among private sector banks, HDFC Bank (down 1.05%), Kotak Mahindra Bank (down 1.21%), Federal Bank (down 0.45%), Karnataka Bank (down 0.59%), South Indian Bank (down 0.36%), and ING Vysya Bank (down 1.6%) edged lower. ICICI Bank (up 0.34%), Yes Bank (up 0.21%) and IndusInd Bank (up 0.39%) edged higher.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 61.72, compared with its close of 61.80 during the previous trading session.
Brent crude oil futures extended gains registered during the previous trading session. Brent for March settlement was up 41 cents at $55.16 a barrel. The contract had jumped $1.76 a barrel or 3.32% to settle at $54.75 a barrel during the previous trading session.
The Reserve Bank of India (RBI) kept its main lending rate viz. the repo rate unchanged at 7.75% after a monetary policy review today, 3 February 2015. The RBI announced a reduction in the statutory liquidity ratio (SLR) of scheduled commercial banks by 50 basis points with effect from the fortnight beginning 7 February 2015 in order to create space for banks to expand credit to the productive sectors so as to support investment and growth in the economy. The RBI has decided to replace the export credit refinance (ECR) facility with the provision of system level liquidity with effect from 7 February 2015. In pursuance of the Dr. Urjit R. Patel Committee's recommendation to move away from sector-specific refinance, the ECR limit has been gradually lowered since June 2014. Continuing with this rationalisation, it has been decided to merge the facility with system level liquidity provision with effect from 7 February 2015, the RBI said. The central bank said it will continue to meet system wide liquidity needs as per the revised liquidity adjustment framework announced on 22 August 2014.
The Eight Core Industries comprise nearly 38% of the weight of items included in the Index of Industrial Production (IIP). The combined Index of Eight Core Industries stands at 172.7 in December, 2014, which was 2.4% higher compared to the index of December, 2013. Its cumulative growth during April to December, 2014-15 was 4.4%.
Asian stocks were mixed today, 3 February 2015. Key indices in China, Taiwan, and Indonesia were up 0.35% to 0.63%. Key indices in Japan, Hong Kong, South Korea, and Singapore were off 0.15% to 1.5%.
The Reserve Bank of Australia (RBA) cut its key policy rate by a quarter percentage point after a monetary policy review today, 3 February 2015, citing weak inflation and a stronger-than-desired currency. The move put the cash rate at a historic low of 2.25%. In comments accompanying the move, RBA Governor Glenn Stevens said that the consumer price index recorded the lowest increase for several years in 2014 and it appears likely that inflation will remain consistent with the target over the next one to two years given weak growth in labor costs. Meanwhile, Stevens repeated the RBA view that the Australian dollar remained above most estimates of its fundamental value, particularly given the significant declines in key commodity prices.
Trading in US index futures indicated that the Dow could fall 79 points at the opening bell today, 3 February 2015. US stocks ended sharply higher yesterday, 2 February 2015 after a late rally driven by hopes for a Greek debt deal and as energy shares bounced with oil prices.
In Europe, Greece's new government has proposed ending a standoff with its international creditors by swapping its outstanding debt for new growth-linked bonds, Finance Minister Yanis Varoufakis was quoted as saying yesterday, 2 February 2015.
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