A bout of volatility was witnessed as key benchmark indices regained positive zone after hitting fresh intraday low in mid-morning trade. The barometer index, S&P BSE Sensex was up 13.59 points or 0.05%, up 74.42 points from the day's low and off 50.69 points from the day's high. The market breadth indicating the overall health of the market turned negative from positive in mid-morning trade.
Axis Bank reversed intraday fall in volatile trade. Coal India also reversed intraday decline in volatile trade. Shares of public sector oil marketing companies (PSU OMCs) were mostly lower after Brent crude hit a nine-month high on Thursday, 19 June 2014. ICRA scaled record high after Moody's Corporation secured a majority equity stake in the Indian company after the completion of a voluntary open offer. Shares of rival rating firm Credit Analysis and Research (CARE) also scaled record high.
At 11:20 IST, the S&P BSE Sensex was up 13.59 points or 0.05% to 25,215.39. The index gained 64.28 points at the day's high of 25,266.08 at onset of the day's trading session. The index fell 60.83 points at the day's low of 25,140.97 in mid-morning trade.
The CNX Nifty was up 4.40 points or 0.06% to 7,545.10. The index hit a high of 7,553.15 in intraday trade. The index hit a low of 7,520.10 in intraday trade.
The market breadth indicating the overall health of the market turned negative from positive in mid-morning trade. On BSE, 1,253 shares declined and 1,150 shares gained. A total of 97 shares were unchanged.
The BSE Mid-Cap index was up 20.52 points or 0.23% at 9,017.87. The BSE Small-Cap index was up 6.55 points or 0.07% at 9,849.53. Both these indices outperformed the Sensex.
The total turnover on BSE amounted to Rs 1023 crore by 11:15 IST on BSE, compared with Rs 713 crore by 10:15 IST.
Among the 30-share Sensex pack, 18 stocks declined and rest of them gained.
Tata Power Company (down 1.82%), Sun Pharmaceutical Industries (down 1.64%) and Tata Motors (down 0.94%) edged lower from the Sensex pack.
Axis Bank rose 1.71% to Rs 1874.10, with the stock reversing intraday fall in volatile trade. The stock hit high of Rs 1,877.15 and low of Rs 1,829.35 so far during the day.
Coal India gained 1.19% to Rs 391, with the stock reversing intraday decline in volatile trade. The stock hit high of Rs 394.50 and low of Rs 381.30 so far during the day. The Government of India holds 89.65% stake in this state-run coal giant. The Securities and Exchange Board of India (Sebi) on Thursday, 19 June 2014, proposed that all listed companies including public sector undertaking (PSUs) shall be required to achieve and maintain minimum public shareholding of 25% of the total number of issued shares within a time period of three years. For PSUs, this is higher than the existing requirement 10% minimum public holding.
Shares of public sector oil marketing companies (PSU OMCs) were mostly lower after Brent crude hit a nine-month high of more than $115 a barrel on Thursday as the United States said it could send military advisers to Iraq. Higher crude oil prices will increase under-recoveries of PSU OMCs on domestic sale of diesel, LPG and kerosene at controlled prices. The government has already freed pricing of petrol.
BPCL (down 1.28%) and Indian Oil Corporation (IOCL) (down 0.59%) edged lower. HPCL rose 0.59%.
Minister for Petroleum & Natural Gas Dharmendra Pradhan on Thursday, 19 June 2014, reviewed the status of the availability of petroleum products in the country in the light of the on-going conflict in Iraq with the Ministry's officials and representatives of the PSU Oil Marketing Companies (OMCs). It was noted that while India imported about 13% of its crude oil requirements from Iraq last year, in the current year, the Public Sector Oil Marketing Companies (OMCs) had planned to import 19.4 Million Metric Tonnes, MMT (about 20% of their requirement) of crude oil from Iraq, mostly by IOCL and HPCL. It was also confirmed that against the 18.7 MMT of crude oil imports planned by these two OMCs from Iraq in 2014, 50% of the contracted quantity has already been lifted. It was further noted that crude supplies to India from Iraq come from the Basra oilfields which are situated well away from the conflict zone in the north-eastern part of Iraq and loading of ships, including by the two PSUs, from the Basra oil terminal, continues normally.
Nonetheless, the OMCs have been asked to prepare a contingency plan both for the short and medium term including diversification of their resources for import of crude oil in order to minimize the impact of any geo-political instability in the middle-east. It was also confirmed during the meeting that there is no possibility of supply disruption at present and adequate supply of petroleum products throughout the country would be maintained by the OMCs, the Ministry of Petroleum & Natural Gas said.
ICRA jumped 13.14% to Rs 2,672.45 after scaling a record high of Rs 2,779.40 in intraday high after Moody's Corporation secured a majority stake in the Indian company through a volunary open offer. Moody's Corporation made the announcement after market hours on Thursday, 19 June 2014.
Moody's Corporation announced that it has secured a majority equity ownership stake in ICRA, increasing its stake from 28.51% to 50.06%.
"The successful conclusion of our offer for a majority stake in ICRA will allow us to extend our strong ties as we work together to serve the growing domestic debt market in India and across the region," said Raymond McDaniel, President and Chief Executive Officer of Moody's.
Moody's Singapore had on 21 February 2014 announced a conditional open offer for acquisition of up to 26.50 lakh equity shares, or 26.50% equity, at Rs 2,000 per share from the shareholders of ICRA. The offer price was later revised to Rs 2,400 per share in May 2014.
The conditional open offer opened on 3 June 2014 and closed on 16 June 2014. Moody's acquired 21.54 lakh shares, or 21.55% equity, of ICRA through the open offer.
Shares of other ratings firms were mixed. Credit Analysis and Research jumped 5.43% to Rs 1,062.45 after scaling a record high of Rs 1,101 in intraday trade.
CRISIL fell 0.56% to Rs 1,697.
Orchid Chemicals & Pharmaceuticals surged 5.64% after the company said it has received approval from USFDA for its abbreviated new drug application for Eszopiclone tablets, 1 mg, 2 mg, and 3 mg strengths. The announcement was made after market hours on Thursday, 19 June 2014.
Pricol rose 4.96% to Rs 42.30. On Thursday, 19 June 2014, HDFC Mutual Fund acquired 25.40 lakh equity shares or 2.69% stake at Rs 39 per share in Pricol through a bulk deal on NSE on Thursday, 19 June 2014. Simultaneously, Precot Meridian sold 26.72 lakh shares of Pricol at Rs 39.01 on the NSE.
Volatility struck bourses in early trade as the key benchmark indices reversed initial gains only to regain positive zone later. Volatility continued in morning trade as the key benchmark indices reversed intraday gain. Key benchmark indices regained positive zone after hitting intraday low in mid-morning trade.
Increase in crude oil prices has sparked worries about India's macroeconomic situation as India imports majority of its crude oil requirements. Increase in crude oil prices has raised concerns of increase in fuel price inflation and increase in India's current account deficit and fiscal deficit
Militant violence in Iraq which is a key oil exporter in the world, has sent crude prices higher over the past few days. Brent crude futures for August delivery were down 1 cent at $115.05 a barrel today, 20 June 2014. The contract gained 80 cents to settle at $115.06 a barrel yesterday, 19 June 2014, the highest close since 6 September 2013.
The United States on Thursday, 19 June 2014, said it will send military advisers to Iraq to support Iraqi security forces and create joint operation centers in Baghdad and northern Iraq. The United States is prepared to make targeted air strikes in Iraq, he said, maintaining that ground troops would not be returning to the country.
Closer home, India's Ministry of Petroleum & Natural Gas on Thursday, 19 June 2014, said that there is no disruption in supply of crude oil from Iraq to India so far. Crude supplies to India from Iraq come from the Basra oilfields which are situated well away from the conflict zone in the north-eastern part of Iraq and loading of crude oil shipments from the Basra oil terminal continues normally, the oil ministry said. Nonetheless, the PSU OMCs have been asked to prepare a contingency plan both for the short and medium term including diversification of their resources for import of crude oil in order to minimize the impact of any geo-political instability in the middle-east, the oil ministry said.
Foreign portfolio investors (FPIs) sold shares worth a net Rs 420.51 crore on Thursday, 19 June 2014, as per provisional data from the stock exchanges.
In the foreign exchange market, the rupee edged lower against the dollar as crude rose. The partially convertible rupee was hovering at 60.2750, compared with its close of 60.08/09 on Thursday, 19 June 2014.
The monsoon has covered half of the country four days behind the usual schedule. Meanwhile, all India seasonal rainfall from 1 to 18 June 2014 was 45% below long period average, the India Meteorological Department said on its website on Thursday, 19 June 2014. The weather office has forecast below average rainfall in 2014 due to fears of El Nino, a weather event marked by the warming of sea surface temperatures in the Pacific Ocean that can lead to droughts in the Asia Pacific region including India.
Asian stocks edged lower on Friday, 20 June 2014. Key benchmark indices in China, Japan, Indonesia, Singapore, Taiwan and South Korea fell by 0.11% to 1.14%. In Hong Kong, the Hang Seng index rise 0.24%.
Trading in US index futures indicated that the Dow could fall 9 points at the opening bell on Friday, 20 June 2014. Most US stocks ended with modest gains on Thursday, 19 June 2014. With miniscule gains, the S&P 500 finished at a record level for the 21st time this year.
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