Key benchmark indices reversed intraday gains in early afternoon trade. The market breadth indicating the overall health of the market turned negative from positive. The barometer index, the S&P BSE Sensex, was currently off 65.96 points or 0.24% at 27,808.77. Data this week is likely to show growth in industrial production remaining muted in September 2014 and inflation falling further in October 2014. Global crude oil prices fell. Foreign portfolio investors (FPIs) bought shares worth a net Rs 355.30 crore yesterday, 10 November 2014, as per provisional data.
Shares of non-banking financial companies rose after the central bank announced a revised regulatory framework for Non-banking Finance Companies (NBFCs), yesterday, 10 November 2014, with a view to streamlining the regulations for the sector. FMCG stocks were mixed. ITC declined on profit booking. Amara Raja Batteries surged to record high after Q2 earnings.
In overseas markets, Japanese stocks led gains in Asian stocks on speculation Japan's Prime Minister Shinzo Abe will delay a sales-tax increase in the country. US stocks finished a thinly-traded day with modest gains yesterday, 10 November 2014, that sent the S&P 500 and Dow Jones Industrial Average to close at record levels for the fourth straight session.
In the foreign exchange market, the rupee edged lower against the dollar.
Brent crude futures dropped, with a firm dollar and robust production from US shale oil fields offsetting a drop in output in Libya.
At 12:16 IST, the S&P BSE Sensex was down 65.96 points or 0.24% at 27,808.77. The index jumped 122.19 points at the day's high of 27,996.92 in morning trade. The index lost 76.13 points at the day's low of 27,798.60 in early afternoon trade.
The CNX Nifty was down 17.05 points or 0.2% at 8,327.20. The index hit a high of 8,378.70 in intraday trade. The index hit a low of 8,324.20 in intraday trade.
The BSE Mid-Cap index was up 12.40 points or 0.12% at 10,025.67. The BSE Small-Cap index was off 13.85 points or 0.12% at 11,120.96. Both these indices outperformed the Sensex.
The market breadth indicating the overall health of the market turned negative from positive in early afternoon trade. On BSE, 1,324 shares declined and 1,290 shares advanced. A total of 91 shares were unchanged.
FMCG stocks were mixed. Marico (up 5.41%), Godrej Consumer Products (up 2.79%), and Nestle India (up 1.41%) gained. Hindustan Unilever (down 0.02%), Colgate-Palmolive (India) (down 1.49%), and Dabur India (down 0.29%) declined.
Shares of cigarette major ITC shed 1.13% at Rs 366.65 on profit booking after yesterday's rally. Shares of ITC had jumped 4.27% to settle at Rs 370.85 yesterday, 10 November 2014, after change of guard at the health ministry. Dr Harsh Vardhan was replaced by senior Bharatiya Janata Party (BJP) leader Jagat Prakash Nadda as the union health minister in a Cabinet expansion and reshuffle announced on Sunday 9 November 2014. Dr Harsh Vardhan was shifted to the more low-key Science and Technology and Earth Sciences Ministry. The health department would now also be overlooked by an additional minister Sripad Yasso Naik. He will independently be responsible for Ayush (ayurveda, yoga and naturopathy, unani, siddhi and homeopathy) department.
Shares of non-banking financial companies rose after the central bank announced a revised regulatory framework for Non-banking Finance Companies (NBFCs), yesterday, 10 November 2014, with a view to streamlining the regulations for the sector. Shriram Transport Finance Company (up 6.5%), Magma Fincorp (up 3.35%), IDFC (up 1.56%), L&T Finance Holdings (up 1.64%), LIC Housing Finance (up 1.22%), Mahindra & Mahindra Financial Services (up 0.59%) and Bajaj Finance (up 1.85%), edged higher.
Explaining the rationale behind the revised framework for NBFCs, the RBI stated that a lighter regulatory framework has been placed on NBFCs other than for those with large asset sizes and deposit accepting. For NBFCs with large asset sizes, and for all deposit accepting NBFCs, regulations have been harmonised across NBFCs, and to some extent, with banks. The intent is to create a level playing field that does not unduly favour or disfavour any institution. The RBI further stated that in limited areas where harmonisation has resulted in strengthening the regulations, generally adequate time has been given to manage the transition.
Amara Raja Batteries surged 2.83% at Rs 714.90. The stock hit a record high of Rs 720 in intraday trade. The company's net profit rose 6.04% to Rs 100.30 points or 31.51% growth in total income to Rs 1071.17 crore in Q2 September 2014 over Q2 September 2013. The result was announced during market hours today, 11 November 2014..
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 61.57, compared with its close of 61.505 during the previous trading session yesterday, 10 November 2014.
Brent crude futures dropped, with a firm dollar and robust production from US shale oil fields offsetting a drop in output in Libya. Brent for December delivery was off 36 cents at $81.98 a barrel. The contract touched a low of $81.87 a barrel in intraday trade, just above the $81.63 seen last week, which was the lowest since October 2010. The contract had fallen $1.05 a barrel to settle at $82.34 a barrel during the previous trading session on Monday, 10 November 2014, the lowest level since October 2010. Brent for January 2015 delivery was off 35 cents at $82.60 a barrel.
Indian government's decision last month to decontrol diesel prices and a sharp decline in global crude oil prices recently will help India in containing its fiscal deficit. The fall in global crude oil prices will also help India in containing its current account deficit and fuel price inflation. India imports 80% of its crude oil requirement. A slump in Brent crude since the end of June contributed to consumer-price index slowing to 6.46% in September 2014, the least since 2012. However, a weakness in rupee against the dollar will restrict the benefit of falling global crude oil prices to that extent.
Data this week is likely to show growth in industrial production remaining muted in September 2014 and inflation falling further in October 2014.
Industrial production is seen rising a muted 0.4% in September 2014, matching the growth in August 2014, as per the median estimate of a poll of economists carried out by Capital Market. The government will unveil industrial production data for September 2014 at 17:30 IST tomorrow, 12 November 2014.
The rate of inflation based on the combined consumer price indices (CPI) for urban and rural India is seen easing further to 5.7% in October 2014, from 6.46% in September 2014, as per the median estimate of a poll of economists carried out by Capital Market. The government will release consumer price inflation data for October 2014 at 17:30 IST tomorrow, 12 November 2014.
The rate of inflation based on wholesale price index (WPI) is seen easing further to 2.1% in October 2014, from 2.38% in September 2014, as per the median estimate of a poll of economists carried out by Capital Market. The government will unveil WPI inflation data for October 2014 at 12:00 noon on Friday, 14 November 2014.
Japanese stocks led gains in Asian stocks today, 11 November 2014, on speculation Japan's Prime Minister Shinzo Abe will delay a sales-tax increase in the country. Key indices in Japan, South Korea, and Indonesia were up 0.24% to 2%. Key benchmark indices in Taiwan and Singapore were down 0.09% to 0.18%
In China, the Shanghai Composite was off 0.63% while Hong Kong's Hang Seng index was up 0.28%. China yesterday, 10 November 2014, said that the Stock Connect program, which allows individual investors outside of China to buy Shanghai-listed shares for the first time ever, will start on 17 November 2014.
Trading in US index futures indicated that the Dow could rise 22 points at the opening bell today 11 November 2014. US stocks finished a thinly-traded day with modest gains yesterday, 10 November 2014, that sent the S&P 500 and Dow Jones Industrial Average to close at record levels for the fourth straight session. The Nasdaq Composite index attained its highest closing level since March 2000. The index was helped by big gains in the biotech and internet stocks.
Federal Reserve Bank of Boston President Eric Rosengren said yesterday, 10 November 2014, the US central bank should refrain from raising short-term term interest rates until there is stronger evidence price pressures are beginning to rise. Monetary policymakers should remain patient about removing accommodation until it is clear that we are on the path to achieving both our 2% inflation target and maximum sustainable employment, Mr. Rosengren said.
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