Key benchmark indices registered small losses on first trading day of the week today, 16 June 2014, after witnessing intraday volatility. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, settled at 1-1/2-week low. The Sensex shed 37.69 points or 0.15%, up 126.55 points from the day's low and off 77.93 points from the day's high. The market breadth indicating the overall health of the market was negative. The market sentiment was edgy as crude oil prices rose and as the rupee fell against the dollar which stoked concerns of fuel price inflation and increase in India's current account deficit and fiscal deficit. The latest data showing increase in inflation based on the wholesale price index in May 2014 also weighed on sentiment.
Index heavyweight Reliance Industries declined. Shares of state-run gas transmission and distribution company GAIL (India) surged on buzz that a foreign brokerage has raised the price target on the stock. PSU OMCs reversed intraday fall in volatile trade after the oil ministry said the under-recovery on diesel declined in the fortnight commencing 16 June 2014. Realty stocks edged higher. Exports-driven IT and pharmaceutical shares gained as the rupee edged lower against the dollar. Shares of private sector banks were mixed. Yes Bank reversed intraday fall in volatile trade after the bank paid higher advance tax in Q1 June 2014. PSU bank stocks declined.
The S&P BSE Sensex shed 37.69 points or 0.15% to settle at 25,190.48, its lowest closing level since 5 June 2014. The index fell 164.24 points at the day's low of 25,063.93 in afternoon trade. The index gained 40.24 points at the day's high of 25,268.41 in early trade.
The CNX Nifty shed 8.55 points or 0.11% to settle at 7,533.55, its lowest closing level since 5 June 2014. The index hit a low of 7,487.55 and a high of 7,548.60 in intraday trade.
The BSE Mid-Cap index rose 30.95 points or 0.35% to settle at 8,966.88. The BSE Small-Cap index rose 29.81 points or 0.31% to settle at 9,704.39. Both these indices outperformed the Sensex.
The market breadth indicating the overall health of the market was negative. On BSE, 1,576 shares declined and 1,377 shares rose. A total of 116 shares were unchanged.
The total turnover on BSE amounted to Rs 3401 crore, lower than Rs 5272.07 crore on Friday, 13 June 2014.
Among the 30-share Sensex pack, 16 stocks declined and rest of them gained.
Index heavyweight Reliance Industries fell 1.67% to Rs 1,063.90. The stock hit high of Rs 1,085 and low of Rs 1,059.
Shares of state-run gas transmission and distribution company GAIL (India) surged 3.96% to Rs 433.30 on buzz that a foreign brokerage has raised the price target on the stock to Rs 525 from Rs 450 earlier. The brokerage remains optimistic about the performance of the company's key business segments barring the petrochemicals business, as per reports. According to the brokerage house, with the new reform-oriented government at the helm, the macro outlook is fast improving. GAIL's gas transmission volumes should start to improve, and trading earnings can rebound after the weak Q4 March 2014. The brokerage did not factor any tariff increase by the company, and highlighted that a 15% tariff increase can boost GAIL's target price by a further 10%.
PSU OMCs reversed intraday fall in volatile trade after the oil ministry said the under-recovery on diesel declined in the fortnight commencing 16 June 2014.
BPCL gained 3.48% to Rs 588. The stock hit high of Rs 593.75 and low of Rs 555.
HPCL advanced 3.48% to Rs 405.90. The stock hit high of Rs 408.75 and low of Rs 381.30.
Indian Oil Corporation (IOCL) rose 0.9% to Rs 336.20. The stock hit high of Rs 340.55 and low of Rs 323.30.
The oil ministry today, 16 June 2014, said that the under-recovery on diesel applicable for second fortnight of June 2014, effective 16 June 2014, will go down to Rs 1.62 per litre from Rs 2.80 per litre during first fortnight of June 2014. In the case of PDS kerosene and domestic LPG, the under-recoveries for the second fortnight of June 2014 continue to be Rs 32.87 per litre and Rs 432.71 per cylinder respectively, as in the first fortnight of June.
PSU OMCs effective 16 June 2014, are now incurring combined daily under-recovery of about Rs 249 crore on the sale of diesel, PDS kerosene and domestic LPG. This is lower than daily under-recovery of Rs 262 crore during the first fortnight of June 2014. The under-recoveries for the financial year 2014-15 are projected to be Rs 91665 crore while the figure was Rs 139869 crore in 2013-14.
Prime Minister Narendra Modi said on Saturday, 14 June 2014, said that repairing the economy would require unpleasant decisions and tough actions. His comments have triggered speculation that the government may raise fuel prices and/or announce diesel price deregulation to reduce the government's fuel subsidy burden.
Hero MotoCorp rose 0.81% to Rs 2,609.70. US-based private equity firm Bain Capital on Friday, 13 June 2014, sold 56.18 lakh shares of Hero MotoCorp via bulk deals on BSE and NSE. Bain Capital through its arm BC India Private Investors II sold 24.09 lakh shares of Hero MotoCorp at an average price of Rs 2,636.15 per share on BSE. BC India Private Investors II sold 32.08 lakh shares of the two-wheeler major at an average price of Rs 2,636.76 per share on NSE. Goldman Sachs Singapore Pte bought 10.45 lakh shares of Hero MotoCorp at an average price of Rs 2,635.59 per share on NSE on that day, the bulk deals data showed.
IT stocks gained on weak rupee. A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports.
Infosys (up 1.83%) and Wipro (up 1.23%) Tech Mahindra (up 0.01%) gained. HCL Technologies fell 1.15% to Rs 1,418.55.
Tata Consultancy Services (TCS) gained 2.24% to Rs 2,264.25. TCS on Friday, 13 June 2014, said that the appreciation of the rupee against the dollar will adversely impact the company's EBIT margin by about 100 basis points in Q1 June 2014. This is based on the rupee movement so far during the quarter and these estimates could change depending on the rupee movement in June. TCS also said that annual salary increments will adversely impact profit margin in Q1 June 2014 which is in line with and proportionate to impact seen in earlier years. TCS also said that other income in Q1 June 2014 will be in line with expectations.
TCS also said that there will be one-time additional depreciation charge of about 2% of fixed assets in financial results as per International Financial Reporting Standards (IFRS) due to a change in depreciation policy. There will be a write back of depreciation of 4% to 5% of fixed assets in consolidated results as per Indian accounting standards due to the change in depreciation policy.
TCS said that there is no change in revenue outlook issued at conference call held after announcing Q4 March 2014 results in April 2014. The TCS management had at that time said that the company was upbeat that the next 12 months will bring many more opportunities for growth across multiple industries and markets.
Private sector bank stocks were mixed. Axis Bank (down 2.92%) and ICICI Bank (down 0.82%) declined. Kotak Mahindra Bank (up 1.34%) and HDFC Bank (up 0.19%) gained.
IndusInd Bank shed 0.57%. The stock turned ex-dividend today, 16 June 2014, for dividend of Rs 3.50 per share for the year ended 31 March 2014 (FY 2014).
Yes Bank rose 1.85% to Rs 537.15, with the stock reversing intraday fall in volatile trade. The stock hit high of Rs 539 and low of Rs 508.10. Yes Bank's advance tax payment rose 20.19% to Rs 125 crore in Q1 June 2014 over Q1 June 2013. Indian companies are required to pay not less than 15% of estimated tax liability for the full year on or before 15 June every year which is the first advance tax installment.
PSU bank stocks declined. Canara Bank (down 2.85%), Punjab National Bank (down 1.31%), State Bank of India (SBI) (down 1.2%), Union Bank of India (down 1.05%), Bank of India (down 0.86%) declined. Bank of Baroda rose 1.02%.
Central Bank of India rose 1.44% to Rs 77.55. Central Bank of India during market hours today, 16 June 2014, said that Capital Raising Committee of the Board at its meeting held on Friday, 13 June 2014, fixed the issue price of Rs 81.83 per equity share (including premium of Rs 71.83 per equity share) for preferential allotment of 7.10 crore shares to Life Insurance Corporation of India (LIC).
Shares of infrastructure developers were mixed. L&T (down 2.12%), IVRCL (down 4.94%), Lanco Infratech (down 1.3%) declined. GVK Power Infrastructure rose 1.77%.
Jaiprakash Associates rose 3.55% to Rs 77.25, with the stock recovering on bargain hunting after recent steep slide. Shares of Jaiprakash Associates had declined 15.46% in three trading sessions to settle at Rs 74.60 on Friday, 13 June 2014, from a recent high of Rs 88.25 on 10 June 2014.
Prime Minister Narendra Modi on Saturday, 14 June 2014, said the government would lay targeted focus on the areas of infrastructure, entrepreneurship and skill development.
GMR Infrastructure rose 0.75%. As per reports, the company is looking to raise $250 million through a qualified institutional placement. According to reports, GMR Group has revived plans to sell shares of GMR Energy, less than two months after scrapping a proposed initial share sale, and its parent GMR Infrastructure (GMR Infra) is looking to raise $250 million (around Rs 1500 crore) through a qualified institutional placement (QIP) as demand for stocks soar.
The Bangalore-based GMR Infra will begin meeting institutional investors from Monday for the QIP, and is planning to file the draft prospectus for GMR Energy with the capital markets regulator by the end of June, reports suggested.
It may be recalled that on 28 April, GMR Infra had told stock exchanges that it had withdrawn plans to take its energy arm public, citing "business reasons".
GMR Infra during market hours today, 16 June 2014, said that a consortium led by the company has won three construction packages of rail line doubling of Multi Modal Transports System (MMTS) - Phase II works on Secunderabad Division of South Central Railway in Andhra Pradesh. Rail Vikas Nigam has issued the letter of award to the GMR consortium on 11 June 2014, the company said in a statement.
The total contract value at approximately Rs 389 crore of which GMR's share of work is about Rs 207 crore.
Idea Cellular rose 0.59%. The Reserve Bank of India on Friday, 13 June 2014, notified that foreign institutional investors (FIIs), through primary market and stock exchanges, can now purchase up to 49% of the paid up capital of Idea Cellular under the portfolio investment scheme (PIS). The FII investment ceiling in the company's shares has been raised from earlier 24% after the company's board of director and shareholders approved the proposal for raising FII investment ceiling, the RBI said. Total holding of FIIs in Idea Cellular stood at 21.57% as per the shareholding pattern as on 11 June 2014.
Reliance Capital advanced 5.12% to Rs 621.35 on bargain hunting after the stock slipped 11.05% in the preceding four trading sessions to Rs 591.10 on 13 June 2014, from a recent high of Rs 664.55 on 9 June 2014.
Rural Electrification Corporation rose 2.13% to Rs 344.90, with the stock recovering on bargain hunting after recent slide. Shares of Rural Electrification Corporation (REC) had declined 10.46% in four trading sessions to settle at Rs 337.70 on Friday, 13 June 2014, from a recent high of Rs 377.15 on 9 June 2014.
Motherson Sumi Systems fell 0.87% to Rs 314.55, with the stock reversing direction after hitting record high of Rs 327 in intraday trade.
Britannia Industries rose 2.36%, with the stock recovering on bargain hunting after Friday's 5.4% slide.
Realty stocks edged higher. D B Realty (up 16.96%), Unitech (up 2.33%), Sobha Developers (up 1.51%), Indiabulls Real Estate (up 0.79%) and Godrej Properties (up 0.79%) gained. Housing Development and Infrastructure fell 0.49%.
DLF rose 2.22%. DLF after market hours on Friday, 13 June 2014, said that DLF Promenad, a subsidiary of the company, has successfully placed the commercial mortgage backed security (CMBS) issuance of Rs 375 crore, with a competitive coupon rate of 10.90% per annum and legal maturity of 7.5 years. DLF Promenade owns and operates approximately 4.5 lakh sq. ft luxury mall in New Delhi. The CMBS issue is rated CRISIL AA (SO). This is a 2nd issuance from DLF Group.
Nitesh Estates surged 4.88% after the company said it has signed up a joint development pact for development of a gated community in an area of 12 acres to accommodate 440 units. The announcement was made on Saturday, 14 June 2014. The project located at prime Hennur Main Road will have easy access to the international airport, outer ring road and major office complexes. The project will give total revenue of Rs 375 crore to the company and will have significant improvement in the profitability over next 36 months, Nitesh Estates said. The project will be launched shortly, the company said.
Dish TV India surged 5.09% to Rs 56.75, with the stock recovering on bargain hunting after recent slide. Shares of Dish TV India had declined 9.62% in three trading sessions to settle at Rs 54 on Friday, 13 June 2014, from a recent high of Rs 59.75 on 10 June 2014.
Granules India rose 2.83% after the company said that its paracetamol facility completed US drug regulator's inspection. The company made the announcement during trading hours today, 16 June 2014.
Granules India announced its paracetamol facility successfully passed a US Food and Drug Administration (USFDA) inspection without any violation of USFDA's requirements. The facility has the world's largest single active pharmaceutical ingredient (API) production line by volume.
Granules' four API facilities have successfully passed USFDA inspections in the past 12 months. All of Granules' facilities including its finished dosage and PFI facility are approved by leading regulatory agencies including the USFDA, EDAM, Health Canada and Korean FDA.
Volatility struck the bourses in early trade as the key benchmark indices dropped to intraday low after reversing initial fall. Key benchmark indices extended fall in morning trade and hit fresh intraday low. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit 1-1/2-week low. A bout of volatility was witnessed in mid-morning trade as the key benchmark indices weakened once again after staging recovery from lower levels. Key benchmark indices extended losses in early afternoon trade after data released by the government showed that the annual rate of inflation based on the wholesale price accelerated in May 2014. The Sensex trimmed losses after hitting fresh intraday low in afternoon trade. Key benchmark indices languished in a narrow range in negative zone in mid-afternoon trade. Volatility ruled the roost in late trade as key benchmark indices once again turned negative after reversing intraday losses.
In the foreign exchange market, the rupee edged lower against the dollar as strong demand for the greenback from oil marketing companies weighed after global crude prices surged to nine-month highs on Friday, 13 June 2014. The partially convertible rupee was hovering at 60.07, compared with its close of 59.76/59.77 on Friday, 13 June 2014.
The recent increase in crude oil price and fall in rupee against the dollar has stoked concerns of fuel price inflation and increase in India's current account deficit and fiscal deficit. Brent crude oil futures rose to near nine-month high today, 16 June 2014, on fears the insurgency in Iraq could worsen and affect oil exports. Brent crude oil futures for August delivery were up 36 cents at $112.82 a barrel. India imports majority of its crude oil requirements.
The annual rate of inflation based on the monthly wholesale price index (WPI) accelerated to 6.01% for the month of May 2014, from 5.2% in April 2014, data released by the government today, 16 June 2014, showed. The WPI inflation for March 2014 was revised upwards to 6%, from 5.7% reported earlier. Non-food manufacturing inflation edged up to 3.8% in May 2014, from 3.4% in April 2014.
Prime Minister Narendra Modi on Saturday, 14 June 2014, said setting the economy on the right track would require unpleasant decisions and tough actions. He added that he was confident that the people would support these decisions, as they would be in the national interest. The Prime Minister said that the government would lay targeted focus on the areas of entrepreneurship, skill development and infrastructure, to harness the talent and energy of India's youth.
Modi called for two movements to be pursued in mission mode. He called for Swachh Bharat - Clean India, to be achieved by the 150th birth anniversary year of Mahatma Gandhi, in 2019. He also called for providing a home with basic amenities of water, power and sanitation, to all families by the 75th anniversary of Indian independence, in 2022. These missions would also build infrastructure and boost employment, the Prime Minister said. The Prime Minster was speaking at in a meeting with leaders from various walks of life in Goa.
European stock markets dropped for a second day on Monday, 16 June 2014, as rising tensions and violence in Iraq hampered investors' risk appetite and drove oil prices to a nine-month high. Key benchmark indices in UK, France and Germany were off 0.22% to 0.48%.
Asian stocks were mixed on Monday, 16 June 2014. Key benchmark indices in Hong Kong, Japan, Singapore and Indonesia were off 0.08% to 1.09%. Key benchmark indices in China, South Korea and Taiwan were up 0.07% to 0.74%.
Trading in US index futures indicated that the Dow could fall 41 points at the opening bell on Monday, 16 June 2014. US stock rose modestly on Friday, 13 June 2014, but trading was choppy with news out of Iraq resulting in price swings in late trade.
In economic news, the University of Michigan/Thomson Reuters sentiment gauge fell in June to 81.2 the lowest level in three months. Separately, government data ahead of the open showed wholesale prices for May fell unexpectedly.
The Federal Open Market Committee (FOMC) undertakes monetary policy review at a two-day meeting that begins tomorrow, 17 June 2014. The FOMC after a monetary policy review on 30 April 2014 reduced its monthly debt purchases to $45 billion, its fourth straight $10 billion cut, and said further reductions are likely in "measured steps" if the economy continues to improve. The Fed also said at that time that it will keep the benchmark interest-rate target at almost zero for a "considerable time" after its bond-buying program ends.
Powered by Capital Market - Live News
