High volatility was witnessed as key benchmark indices retained positive terrain in mid-afternoon trade. The market breadth, indicating the overall health of the market, was positive. The barometer index, the S&P BSE Sensex, was up 136.61 points or 0.67%, off close to 50 points from the day's high and up close to 40 points from the day's low. Gains in Asian and European stocks underpinned sentiment on the domestic bourses. Asian and European stocks rose after US employment and consumer confidence reports boosted optimism in the world's largest economy.
Capital goods stocks rallied. Metal stocks edged higher. Tyre shares jumped, with CEAT scaling record high.
The market surged in early trade on firm Asian stocks. The market extended initial gains and hit fresh intraday high in morning trade. Firmness continued on the bourses in mid-morning trade. The Sensex trimmed gains in early afternoon trade. Key benchmark moved in a narrow range in afternoon trade. High volatility was witnessed as key benchmark indices retained positive terrain in mid-afternoon trade.
The market may remain volatile during the last one hour or so of the trading session as traders roll over positions in the futures & options (F&O) segment from the near month November 2013 series to December 2013 series. The near month November 2013 derivatives contracts expire today, 28 November 2013.
At 14:20 IST, the S&P BSE Sensex was up 136.61 points or 0.67% to 20,556.87. The index jumped 186.12 points at the day's high of 20,606.38 in morning trade, its highest level since 25 November 2013. The index rose 97.71 points at the day's low of 20,517.97 in early trade.
The CNX Nifty was up 40.10 points or 0.65% to 6,097.20. The index hit a high of 6,112.95 in intraday trade, its highest level since 25 November 2013. The index hit a low of 6,088.80 in intraday trade.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,367 shares rose and 993 shares dropped. A total of 171 shares were unchanged.
Reliance Industries (up 1.8%), Tata Power Company (up 1.74%) and Coal India (up 1.56%) edged higher from the Sensex pack.
Metal stocks edged higher. Hindalco Industries (up 2.57%), Jindal Steel & Power (up 0.9%), Tata Steel (up 0.91%), Sail (up 1.19%), Hindustan Copper (up 1.1%), Sesa Sterlite (up 1.72%) and National Aluminum Company (up 2.04%) gained.
In mid-November 2013, China released a broad outline for structural reform of the economy. China is the world's largest consumer of copper and aluminum.
Bhushan Steel rose 0.71%. The company said during market hours that it has received a Direction of Closure from the State Pollution Control Board, Odisha for not starting the operations of Blast Furnace No. 2 of the company at the steel plant of the company at Meramandali, District Dhenkanal, Odisha again, till the further direction of the Pollution Board. The company had on 14 November 2013 informed that an explosion happened in the slag pit during the trial run of the Blast Furnace No.2 of the company at Meramandali. The trial run of Blast Furnace No. 2 started recently on 10 November 2013.
Bhushan Steel said that its existing operational units of the steel plant at Meramandali, Odisha viz., Conarc Furnace, Arc Furnace, DRI Kilns, Blast Furnace No. 1, Coke Oven, Slab Caster, HR Mill, etc. remain fully operational as earlier.
Capital goods stocks rallied. L&T (up 1.52%), Crompton Greaves (up 4.1%), ABB (up 2.8%) and Bhel (up 3.18%) gained.
Tyre shares jumped. Apollo Tyres (up 5.35%), JK Tyre & Industries (up 12.6%), Goodyear India (up 5.45%), and MRF (up 1.16%) gained.
CEAT rose 5.07% to Rs 291.35, with the stock hitting record high of Rs 294.70 in intraday trade.
In the foreign exchange market, the rupee edged lower against the dollar as US economic data renewed speculation the Federal Reserve will trim monetary stimulus for the US economy. The partially convertible rupee was at 62.41, compared with its close of 62.14/15 on Wednesday, 27 November 2013. Fed's bond-buying program has been a source of liquidity for most Asian and emerging markets this year.
Indian government bond prices dropped as US economic data renewed speculation the Federal Reserve will trim monetary stimulus for the US economy. The yield on 10-year benchmark federal paper, 7.16% GS 2023, was hovering at 9.031%, higher than its close of 8.9962% on Wednesday, 27 November 2013. Bond yields and bond prices are inversely related.
The government will stick to its 2013/14 borrowing programme but will calibrate its debt sale plans according to market conditions, Economic Affairs Secretary Arvind Mayaram said today, 28 November 2013. "We are mindful of what the going yields are and therefore calibrate the borrowing accordingly because markets fluctuate. It's not that they are fixed at one point," Mayaram told reporters at the sidelines of a financial event. "We will continue with what our requirements are. But we will calibrate keeping in mind the market conditions on the day in which we go out," he said.
Mayaram also said the Reserve Bank of India is expected to switch back to a "more modest" interest rate regime once the country's investment cycle picks up. Mayaram also said that the government's Rs 40000-crore divestment programme for the current fiscal year ending in March 2014 (FY 2014) will be fully met.
India's economic growth is seen recovering a bit in Q2 September 2013. The GDP growth for Q2 September 2013 is projected at 4.7%, as per the median estimate of a poll of economists carried out by Capital Market. India's GDP grew at its slowest pace in four years at 4.4% in Q1 June 2013. The government unveils Q2 September 2013 GDP growth data tomorrow, 29 November 2013.
The Reserve Bank of India (RBI) announces next Mid-Quarter Review of Monetary Policy for 2013-14 on 18 December 2013. The Third Quarter Review of Monetary Policy for 2013-14 is scheduled 28 January 2014.
European stocks edged higher on Thursday, 28 November 2013, ahead of German inflation and unemployment data. Key benchmark indices in France and Germany rose 0.12% to 0.16%. UK's FTSE 100 fell 0.05%.
Asian stocks edged higher on Thursday, 28 November 2013, after US employment and consumer confidence reports boosted optimism in the world's largest economy. Key benchmark indices in China, Taiwan, South Korea, Singapore, and Japan were up 0.46% to 1.8%. Hong Kong and Indonesia were down by 0.07% to 0.87%.
Japan's top government spokesman today, 28 November 2013, said that Japanese and US defense ministers agreed on Wednesday in a telephone conference to respond resolutely and calmly to China's moves to alter the region's status quo. Chief Cabinet Secretary Yoshihide Suga said Japanese Defense Minister Itsunori Onodera and US Defense Secretary Chuck Hagel agreed that China's setting up a so-called air-defense zone recently is "an action that could lead to unforeseeable circumstances and hurt the regional stability." Mr. Suga said the Japanese government wants to deliver its view on the matter to China in coordination with US and other nations.
The zone covers airspace above a series of East China Sea island at the heart of a dispute between Japan and China, and its establishment triggered strong warnings from both Tokyo and Washington that the action would destabilize the region.
The US stock market is closed today, 28 November 2013, for the Thanksgiving holiday. The market will close early at 1:00 p.m. on Friday, 29 November 2013. US stocks rose on Wednesday, 27 November 2013, with Dow Jones Industrial Average and the S&P 500 ending at their record high as Hewlett-Packard Co. led a technology rally while data on employment and consumer confidence boosted optimism in the economy.
Data yesterday showed fewer Americans than projected filed applications for unemployment benefits last week, a sign that the labor market is showing resilience. The Thomson Reuters/University of Michigan final index of consumer sentiment in November unexpectedly rose to 75.1 from 73.2 a month earlier. The Conference Board's index of US leading indicators, a gauge of the economic outlook for the next three to six months, rose for a fourth straight month in October, reflecting gains in factory orders and applications to build new homes.
Investors have been keeping watch on economic data in the United States as the Federal Reserve monitors the pace of recovery to gauge when it will begin to reduce monetary stimulus for the US economy, which has been aimed at encouraging growth. The Fed has said improvement in the labor market is a key factor in its policy assessment. The Federal Open Market Committee (FOMC) holds a two-day policy meeting on interest rates in the United States on 17-18 December 2013. The US central bank currently buys bonds worth $85 billion a month in a bid to hold interest rates low and encourage economic growth in the world's biggest economy. Minutes of the Fed's October meeting released on 20 November 2013 showed officials may reduce their $85 billion a month of bond buying if the economy improves as anticipated.
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