Key benchmark indices remained firm in early afternoon trade after hitting record high earlier during the day on the back of data showing that the gross domestic product (GDP) grew 5.7% in Q1 June 2014, its fastest pace in two-and-half years. The barometer index, the S&P BSE Sensex, was currently up 179.04 points or 0.67% at 26,817.15. The market breadth indicating the overall health of the market was strong. The BSE Mid-Cap index was up 1.26%. The BSE Small-Cap index was 1.08%. Both these indices outperformed the Sensex. Capital goods stocks gained. Among pharma shares, Cipla and Dr Reddy's Laboratories hit record high.
Data showing improvement in economic growth in Q1 June 2014 triggered a firm opening on the domestic bourses and took indices to record high. The 50-unit CNX Nifty hit record high above the psychological 8,000 level.
A Supreme Court hearing on coal blocks case is scheduled today, 1 September 2014. The apex court on 25 August 2014 deemed all coal block allocations made since 1993 as illegal. The allocations had no objective criteria and no fair and transparent procedure was followed, the court had said.
Asian stocks rose as investors weighed whether Chinese policy makers will add stimulus after reports showing slower manufacturing growth in August 2014. Brent crude prices dropped after registering gains during the previous trading session.
At 12:19 IST, the S&P BSE Sensex was up 179.04 points or 0.67% at 26,817.15. The index jumped 215.97 points at the day's high of 26,854.08 in morning trade, a lifetime high for the index. The index rose 94.28 points at the day's low of 26,732.39 in early trade.
The CNX Nifty was up 58.30 points or 0.73% to 8,012.65. The index hit a high of 8,022.70 in intraday trade, a lifetime high for the index. The index hit a low of 7,984 in intraday trade.
The market breadth indicating the overall health of the market was strong. On BSE, 1,707 shares gained and 884 shares fell. A total of 113 shares were unchanged.
The BSE Mid-Cap index was up 116.87 points or 1.26% at 9,415.77. The BSE Small-Cap index was up 111 points or 1.08% at 10,375.45. Both these indices outperformed the Sensex.
Capital goods stocks gained. ABB (India) (up 1.35%), L&T (up 2.86%), BEML (up 5%), Crompton Greaves (up 4.24%) and Siemens (up 2.66%) gained. Bharat Heavy Electricals (Bhel) fell 0.27%.
Bajaj Electricals rose 3.5% after the company said its engineering and project business has bagged four new orders aggregating to Rs 602.12 crore for transmission lines and rural electrification work.
Cipla rose 2.56% to Rs 527.45 after hitting record high of Rs 527.85 in intraday trade.
Dr Reddy's Laboratories rose 0.57% to Rs 2,968 after hitting record high of Rs 2,974.95 in intraday trade.
Natco Pharma rose 4.7% after the company said that its marketing partner in the US, Mylan Inc. has filed an abbreviated new drug application (ANDA) for a three-times-a-week generic Copaxone in the United States. Mylan believes it is one of the first companies to have filed a substantially complete ANDA containing a Paragraph IV certification for this product and expects to be eligible for 180 days of marketing exclusivity in the US upon final FDA approval. Copaxone 40 mg/mL had sales of approximately $411.5 million in the US for the 12 months ended 30 June 2014, according to IMS Health.
Wockhardt advanced 3.6% after the company on Sunday, 31 August 2014, said that New Drug Discovery program in Anti-Infective research received a major boost after two of its drugs, WCK 771 and WCK 2349, received the Qualified Infectious Disease Product (QIDP) Status from the US Food and Drug Administration (USFDA). This is the first instance of an Indian Pharmaceutical company receiving a QIDP status, Wockhardt said in a statement.
Asian Granito India jumped 4.98% after the company said its board of directors at its meeting held on 30 August 2014, framed a Committee of Directors to analyze the matter on allotment of warrants by way of preferential issue and after due study, the committee will suggest the ways and means and various options in next four to five weeks.
Brent crude prices dropped after registering gains during the previous trading session. Brent for October settlement was off 21 cents at $102.98 a barrel. The contract rose 73 cents to settle at $103.19 a barrel on Friday, 29 August 2014.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 60.48, compared with its close of 60.52 on Thursday, 28 August 2014. Indian financial markets were closed on Friday, 29 August 2014, for a holiday.
Markit Economics said today, 1 September 2014, that the seasonally adjusted HSBC India Purchasing Managers' Index (PMI)-a figure designed to give an accurate overview of business conditions in the manufacturing sector -dipped slightly from July's 17-month high of 53 to 52.4 in August. Nonetheless, the reading was consistent with a solid improvement in operating conditions. The latest PMI data highlighted a tenth consecutive monthly improvement in operating conditions in August, as solid output growth was supported by strong expansions in total new orders and business from abroad. Purchasing activity continued to rise, although a second consecutive decline in employment was recorded. Meanwhile, input cost pressures eased slightly following the acceleration seen in July.
India's gross domestic product (GDP) grew 5.7% in Q1 June 2014, its fastest pace of growth in two-and-half years. The GDP growth has shown sharp improvement from 4.6% in Q4 March 2014 and 4.7% in Q1 June 2013. The Central Statistical Office (CSO) released quarterly estimates of India's GDP on Friday, 29 August 2014, when Indian financial markets were closed for a holiday. The improvement in the GDP growth was facilitated by rebound in industrial sector growth after two sequential quarters of decline. More importantly, the GDP data showed that domestic investment demand has exhibited strong growth of 7% in Q1 June 2014.
Finance Minister Arun Jaitley said at a press briefing on Saturday, 30 August 2014, that he expects the country's economic growth to accelerate as inflation moderates and government measures aimed at making it easier for companies to do business take effect. Mr. Jaitley also expressed confidence that the government would be able to achieve the 4.1% of GDP fiscal deficit target that the government set in the annual budget presented in July.
The Finance Ministry expects India's economy to grow at 5.7% to 5.9% during the current fiscal year. In a statement issued on 30 August 2014, the Finance Ministry said it expects India to reclaim the high growth rate of 7% within 2-3 years. The Finance Ministry further said that with a view to ensure macroeconomic stability, the current account deficit will be contained within 2% of GDP and fiscal deficit will be contained within 4.1% of GDP during the current fiscal year.
Reserve Bank of India (RBI) Governor Raghuram Rajan said in a newspaper interview published on Sunday, 31 August 2014, that India is better prepared to handle the impact of interest rate increases in the United States as foreign funds are less likely to desert the country due to signs of an upturn in economic growth. Rajan said that his commitment to cool surging prices will also support the rupee when US rates finally do rise.
Prime Minister Narendra Modi is in the midst of his five-day trip to Japan to bolster security and business ties with Japan in the face of an assertive China.
Asian stocks rose today, 1 September 2014, as investors weighed whether Chinese policy makers will add stimulus after reports showing slower manufacturing growth in August 2014. Key benchmark indices in Indonesia, Hong Kong, China, Japan and Taiwan were up 0.18% to 0.81%. Key benchmark indices in Singapore and South Korea were off 0.03% to 0.47%.
Growth in China's large factory sector slipped to a three-month low in August as foreign and domestic demand cooled, a private survey showed on Monday, raising concerns that the economy is faltering after a bounce. The final HSBC/Markit Purchasing Managers' Index (PMI) retreated to 50.2 in August, roughly in line with a preliminary reading of 50.3 and only a shade above the 50-point mark that demarcates an expansion in activity from a contraction.
China's official manufacturing PMI for August, reported today, 1 September 2014, was 51.1, compared with July's 51.7.
US stocks climbed on Friday, 29 August 2014, ahead of a three-day weekend. US markets remain closed today, 1 September 2014, for Labor Day holiday.
On the economic front Friday, the Commerce Department reported American household spending fell 0.1% in July, bucking forecast for a 0.1% increase. Personal income rose a less-than-expected 0.2%.
On Saturday, 30 August 2014, Ukrainian President Petro Poroshenko warned a "full-scale war" was imminent if Russian troops continued to advance in support of pro-Moscow rebels, while US and European leaders threatened Moscow with further sanctions.
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