Bank stocks led gains as key benchmark indices edged higher on positive cues from European stocks and on a rally in US index futures. High volatility was witnessed in late trade as key benchmark indices trimmed gains soon after extending intraday gains. The barometer index, the S&P BSE Sensex, regained the psychological 26,000 mark. The Sensex surged 109.19 points or 0.42% to settle at 26,108.53. The market breadth indicating the overall health of the market was negative.
Bank stocks advanced. Telecom stocks also edged higher. Capital goods stocks advanced. DLF edged higher amid volatility on reports the company has filed an appeal with the Securities Appellate Tribunal (SAT) against a ban from tapping capital markets for three years. TCS tumbled after as the company's operating profit margin (OPM) dropped on sequential basis in Q2 September 2014 and after the company forecast the current period will be "soft". HCL Technologies slumped as its earnings before interest, taxes, depreciation and amortization (EBITDA) declined 1.1% in Q1 September 2014 over Q4 June 2014. Hero MotoCorp surged in volatile trade after strong Q2 earnings.
Key indices witnessed high intraday volatility. Earlier, key indices had drifted lower in mid-morning trade after a range bound movement in morning trade. Before that, key indices had bounces back after a weak opening.
In overseas markets, European stocks edged higher as an ailing euro-area economy increases pressure on policy makers to provide more stimulus measures. Asian stocks were mixed. Trading in US index futures indicated a rally for US stocks at the opening bell later in the global day today, 17 October 2014. US stocks recovered from early losses yesterday, 16 October 2014, as St. Louis Federal Reserve Bank President James Bullard said policy makers should consider delaying the end of bond purchases to halt the decline in inflation expectations.
Brent crude oil prices climbed from the lowest level in almost four years on speculation prices decreased more than justified.
In the foreign exchange market, the rupee edged higher against the dollar, tracking stronger Asian currencies.
The S&P BSE Sensex surged 109.19 points or 0.42% to settle at 26,108.53, its highest closing level since 14 October 2014. The index jumped 249.20 points at the day's high of 26,248.54 in late trade. The index lost 88.57 points at the day's low of 25,910.77 in mid-morning trade, its lowest level since 13 August 2014.
The CNX Nifty advanced 31.50 points or 0.41% to settle at 7,779.70, its highest closing level since 14 October 2014. The index hit a high of 7,819.20 in intraday trade. The index hit a low of 7,723.85 in intraday trade, its lowest level since 13 August 2014.
The BSE Mid-Cap index rose 28.54 points or 0.31% to settle at 9,272.49. The BSE Small-Cap index declined 29.12 points or 0.28% to settle at 10,313.97. Both these indices underperformed the Sensex.
The market breadth indicating the overall health of the market was negative. On BSE, 1,497 shares dropped while 1,332 shares rose. A total of 119 shares were unchanged.
Among Sensex pack, 21 shares rose while remaining stocks declined.
Among BSE Sectoral indices, the S&P BSE Auto index (up 0.7%), Bankex index (up 2.46%), Consumer Durables index (up 1.81%), Capital Goods index (up 1.86%), Healthcare index (up 0.66%), Power index (up 1.34%), and Realty index (up 0.96%) outperformed the Sensex.
The BSE FMCG index (up 0.15%), IT index (down 4%), Metal index (up 0.14%), Oil & Gas index (up 0.36%), and Teck index (down 2.67%) underperformed the Sensex.
Index heavyweight Reliance Industries (RIL) rose 0.62% at Rs 938.15. The stock hit a high of Rs 941 and a low of Rs 925.60. RIL's consolidated net profit rose 1.7% to a record Rs 5972 crore in Q2 September 2014 over Q2 September 2013. Turnover declined 4.3% to Rs 113396 crore in Q2 September 2014 over Q2 September 2013. RIL attributed the decline in turnover to lower crude prices and decline in volumes in the refining and oil & gas businesses. RIL announced the results early this week.
Bank stocks advanced. HDFC Bank (up 3.04%), ICICI Bank (up 2.66%), Bank of India (up 2.67%), State Bank of India (up 2.3%), Yes Bank (up 1.67%), Kotak Mahindra Bank (up 1.56%), Bank of Baroda (up 0.56%), and Punjab National Bank (up 0.16%) gained.
Axis Bank rose 2.04% at Rs 401.95. The bank's net profit rose 18.23% to Rs 1610.71 crore on 12.53% growth in total income to Rs 10549.97 crore in Q2 September 2014 over Q2 September 2013. The result was announced after market hours.
The bank's ratio of gross non-performing assets (NPAs) to gross advances stood at 1.34% as on 30 September 2014, unchanged from 30 June 2014, but higher than 1.19% as on 30 September 2013. The ratio of net NPAs to net advances stood at 0.44% as on 30 September 2014, unchanged from 30 June 2014, but higher than 0.37% as on 30 September 2013.
Axis Bank yesterday, 16 October 2014, said that the bank has reduced its base rate by 10 basis points to 10.15% per annum (p.a.) from 10.25% with effect from 15 October 2014. The bank attributed the reduction in base rate to decline in cost of funds. The cost of funds has eased due to softening of interest rates based on improving liquidity and other macroeconomic developments, Sidharth Rath, President (Treasury, Business Banking & Capital Markets), Axis Bank said in a statement.
IndusInd Bank rose 2.39% at Rs 661.35. The bank during market hours in a clarification with regard to news item titled "IndusInd Bank to foray into asset reconstruction business" said that the article is factually correct and part and parcel of the bank's normal scope of lending and investment activity. The bank will work with asset reconstruction companies, but is not setting up one itself, IndusInd Bank said. The bank is already in the business of reconstruction and recovery of some of its own non-performing assets and this is purely an extension of such historical activity, IndusInd Bank said.
Capital goods stocks edged higher. Bharat Heavy Electricals (up 3.4%), L&T (up 2.11%), and Thermax (up 0.96%) gained. ABB (down 1.75%) declined.
Crompton Greaves rose 1.19% at Rs 190.95. The stock was volatile. The stock hit a high of Rs 196 and a low of Rs 181.80. On a consolidated basis, Crompton Greaves reported 19.14% rise in net profit to Rs 69.59 crore on 6.16% growth in total income to Rs 3475.79 crore in Q2 September 2014 over Q2 September 2014. The result was announced after market hours on Thursday, 16 October 2014.
Crompton Greaves said that the Scheme of demerger of the Consumer Products Business Unit of the company into Crompton Greaves' wholly owned subsidiary Crompton Consumer Products was approved by the board of directors at its meeting held on Thursday, 16 October 2014. The Scheme will come into effect from the Appointed Date of 1 April 2015, subject to receipt of all Regulatory approvals.
The board also approved an increase in the investment limit for foreign institutional investors (FIIs) and foreign portfolio investors (FPIs) upto 100% of the paid-up equity share capital of the company pursuant to the provisions of Foreign Exchange Management Act, 1999, and the Foreign Exchange Management (Transfer or issue of Security by a Person Resident Outside India) Regulations, 2000.
As part of its continuous asset optimisation initiatives, the board of directors of the company has approved entering into a definitive agreement for sale of a portion of its land parcel at Kanjurmarg, admeasuring approx 8 acres to Evie Real Estate for an aggregate sum of Rs 302.26 crore, Crompton Greaves added.
Siemens rose 2.06% at Rs 796.35. The company during market hours in a clarification with regard to news item titled "Siemens gets nod to set up six more centres of excellence in Guj" said that the news pertains to Siemens Industry Software (India ), a Group Company of Siemens AG in India, and not Siemens.
Telecom stocks advanced. Bharti Airtel (up 2.1%), Idea Cellular (up 4.62%), and Reliance Communications (up 0.76%) gained. Telecom Regulatory Authority of India (Trai) on 15 October 2014 set the starting prices for a coming auction of frequencies to cellphone companies whose permits are set to expire later this year. The Trai suggested that the Department of Telecommunications auction frequencies in the 900-megahertz band with a starting price of Rs 3004 crore per unit and in the 1800-megahertz band at Rs 2138 crore.
The auctions are crucial to top four cellphone operators viz. Bharti Airtel, the local unit of Vodafone Group PLC., Idea Cellular and Reliance Communications, whose permits in some of the service areas are set to expire in the next two years. These operators use frequencies in both bandwidths to provide cellphone services. Auctions won't be held for the 900-megahertz band in four service areas, and in two service areas for the 1800-megahertz band as frequencies aren't available in those areas, the regulator said.
TCS tumbled after as the company's operating profit margin (OPM) dropped on sequential basis in Q2 September 2014 and after the company forecast the current period will be "soft". The stock lost 8.73% at Rs 2,444.90. The stock hit a high of Rs 2,509.50 and a low of Rs 2,433.10. On BSE, 5.76 lakh shares changed hands in the counter, compared with average daily volume of 75,777 shares in the past one quarter. The company's consolidated net profit fell 5.8% to Rs 5244 crore on 7.7% growth in revenue to Rs 23816 crore in Q2 September 2014 over Q1 June 2014. The operating profit rose 7.03% to Rs 6800.40 crore in Q2 September 2014 over Q1 June 2014. The OPM declined to 28.55% in Q2 September 2014, from 28.73% in Q1 June 2014. The result was announced after market hours yesterday, 16 October 2014.
TCS predicts a "soft quarter" in the three months through December as the holiday season slows outsourcing work at industries ranging from retail to manufacturing, Chief Executive Officer N. Chandrasekaran told reporters after the announcement of the second quarter results yesterday, 16 October 2014.
HCL Technologies slumped as its earnings before interest, taxes, depreciation and amortization (EBITDA) declined 1.1% in Q1 September 2014 over Q4 June 2014. The stock lost 9.09% at Rs 1,505.55. The stock hit a high of Rs 1,600 and a low of Rs 1,496.95. The company's consolidated net profit as per US accounting standards rose 2.1% to Rs 1873 crore on 3.7% growth in revenue to Rs 8735 crore in Q1 September 2014 over Q4 June 2014. EBITDA declined 1.1% to 2192 crore in Q1 September 2014 over Q4 June 2014. EBITDA margin dropped to 25.1% in Q1 September 2014, from 26.3% in Q4 June 2014. The result was announced before market hours today, 17 October 2014.
Other IT stocks declined. MindTree (down 2.27%), Tech Mahindra (down 1.28%), Wipro (down 1.08%), MphasiS (down 0.88%), and Infosys (down 0.3%) declined.
DLF rose 0.32% at Rs 110.70. The stock hit a high of Rs 114.45 and a low of Rs 105.45. According to reports, DLF has filed an appeal with the Securities Appellate Tribunal (SAT) against a ban from tapping capital markets for three years. Market regulator Securities and Exchange Board of India (Sebi) early this week issued an order barring DLF and its chairman K.P. Singh along with five other company executives from accessing India's capital markets for three years. The order is related to lapses in disclosures made at time of the company's IPO in 2007.
On Wednesday, 15 October 2014, credit rating agency CRISIL placed its ratings on the bank facilities and debt instruments of DLF on 'Rating Watch with Negative Implications'. CRISIL said that the Sebi order will adversely impact DLF's ability to access the capital markets and constrain its financial flexibility, which has been one of its key rating strengths, CRISIL said. The order will impact DLF's plans to raise funds through capital market instruments such as equity, commercial mortgage-backed securities (CMBS) and real estate investment trusts (REITs) over the medium term, CRISIL said.
Hero MotoCorp rose 3.05% at Rs 2,877.10. The stock hit a high of Rs 2,909 and a low of Rs 2,740.30. The company's net profit jumped 58.56% to Rs 763.37 crore on 21.69% growth in total income to Rs 7108.85 crore in Q2 September 2014 over Q2 September 2013. The result was announced after market hours yesterday, 16 October 2014.
Ranbaxy Laboratories rose 0.25% at Rs 591.30. The company after market hours yesterday, 16 October 2014 in a clarification with regard to a news item titled "Sun, Ranbaxy may be asked to sell some business for CCI approval to merger" said that the news article suggests that the Competition Commission of India (CCI) may ask the parties to the merger to sell parts of their businesses as a pre-condition to approve the merger. As on date, the company has not received any such communication from the CCI to divest any part of the business(s), Ranbaxy said. The parties have made certain submissions to the CCI on which decision of the CCI is awaited, it added.
Sun Pharmaceutical Industries rose 0.13% at Rs 797.85. The stock hit a high of Rs 806.25 and a low of Rs 792.
Meanwhile, Sun Pharmaceutical Industries before market hours also clarified with regard to above news item that it has not received any direction from CCI for divesting any business as indicated in the said news article.
UltraTech Cement rose 0.56% at Rs 2,322.75. The company after market hours yesterday, 16 October 2014 in a clarification with regard to news item titled "UltraTech eyes Holcim-Lafarge assets to cement global position" said that in the course of business, the company evaluates various proposals on a regular basis. There is no proposal which has reached the stage which would trigger Clause 36 of the Listing Agreement, the company said. Recent media reports had suggested that UltraTech Cement is eyeing the assets being divested by Lafarge and Holcim in Europe and Brazil as part of their merger plans.
Indian Oil Corporation (IOC) rose 1.33% at Rs 365.55. The company after market hours yesterday, 16 October 2014, in a clarification with regard to news item titled "IOC to Invest $4 b in British Columbia Province in Canada" said that the company, through its wholly owned affiliate Indoil Montney., Canada had signed transaction agreements with Progress Energy Canada (Progress Energy Canada), PETRONAS Carigall Canada BV (PCC BV) -- wholly owned affiliates of PETRONAS -- for the acquisition of a 10% interest in Progress Energy Canada's LNG-destined natural gas reserve in British Columbia and in the proposed Pacific North West LNG Project on 7 March 2014. Indian Oil shall offtake 1.2 MMTPA of LNG from the project, IOC said.
Praj Industries rose 3.16% at Rs 63.65 after consolidated net profit surged 284.39% to Rs 24.87 crore on 36.45% increase in total income from operations to Rs 265.04 crore in Q2 September 2014 over Q2 September 2013. The result was announced after market hours yesterday, 16 October 2014.
Key benchmark indices today, 17 October 2014, snapped two-day losing streak. The Sensex had lost 384.73 points or 1.45% in two trading sessions to settle at 25,999.34 yesterday, 16 October 2014, from a recent high of 26,384.07 on 13 October 2014. The Sensex has lost 521.98 points or 1.96% in this month so far (till 17 October 2014). The Sensex has gained 4,937.85 points or 23.32% in calendar year 2014 so far (till 17 October 2014). From a record high of 27,354.99 on 8 September 2014, the Sensex has declined 1,246.46 points or 4.55%. From a 52-week low of 19,963.12 on 4 February 2014, the Sensex has risen 6,145.41 points or 30.78%.
Foreign portfolio investors (FPIs) sold shares worth a net Rs 1097.11 crore into the secondary equity market yesterday, 16 October 2014, according to the data from the Securities and Exchange Board of India.
In the foreign exchange market, the rupee edged higher against the dollar, tracking stronger Asian currencies. The partially convertible rupee was hovering at 61.45, compared with its close of 61.84 during the previous trading session.
Reserve Bank of India (RBI) Governor Raghuram Rajan said in Hyderabad yesterday, 16 October 2014, that the drop in bond yields is partly signaling RBI's success in controlling inflation. The RBI is targeting consumer price inflation of 8% by January 2015 and 6% by January 2016.
Brent crude oil prices climbed from the lowest level in almost four years on speculation prices decreased more than justified. Brent for December settlement was up $1.23 a barrel at $87.05 a barrel. The contract had risen $1.70 a barrel to settle at $85.82 a barrel yesterday, 16 October 2014.
European stocks climbed today, 17 October 2014, as an ailing euro-area economy increases pressure on policy makers to provide more stimulus measures. Key benchmark indices in UK, France and Germany were up 0.61% to 1.54%.
German Chancellor Angela Merkel told lawmakers in Berlin yesterday, 16 October 2014, that existing economic aid had been underused and now wasn't the moment to ease up on the fiscal discipline she credits with bringing stability to the continent.
Asian stocks were mixed today, 17 October 2014. Key indices in Japan, China, Taiwan, and South Korea were off 0.65% to 1.4%. Key indices in Hong Kong, Singapore and Indonesia were up 0.41% to 1.56%. China is expected to release third-quarter economic growth figures on Tuesday, 21 October 2014.
The MNI China Business Indicator fell to a eight-month low of 51.7 in October, the latest data showed today, 17 October 2014. It was down from September's reading of 52.2. While the indicator remains above the breakeven 50 line that separates expansion from contraction, the trend weakened further, with business sentiment below the average of 54 seen over the past 12 months.
Trading in US index futures indicated that the Dow could gain 167 points at the opening bell today, 17 October 2014. US stocks ended little changed yesterday, 16 October 2014, with the Dow industrials recouping much of a 206-point deficit, as investors balanced worries about global growth against mostly better-than-expected US earnings and economic reports.
The National Association of Home Builders (NAHB)/Wells Fargo housing market index fell unexpectedly last month, official data showed on Thursday, 16 October 2014. In a report, NAHB said that NAHB Housing Market Index fell to 54, from 59 in the preceding month.
The Federal Reserve may want to extend its bond-buying program beyond October to keep its policy options open given falling US inflation expectations, Federal Reserve Bank of St. Louis President James Bullard said yesterday, 16 October 2014.
The Federal Open Market Committee (FOMC) next undertakes a monetary policy review at a two-day meeting on 28-29 October 2014.
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