The market is poised for higher start on positive Asian stocks. Trading of CNX Nifty futures on the Singapore stock exchange indicates that the Nifty could gain 32 points at the opening bell. Asian stocks edged higher on Thursday after Federal Reserve meeting minutes showed policy makers see a muted risk of inflation from continued U.S. stimulus and a China manufacturing gauge rose to a five-month high in May.
Jewellery stocks will be watched after the Reserve Bank of India (RBI) eased some restrictions on gold imports that were imposed last year. RBI on Wednesday, 21 May 2014, allowed large private gold importers, or star and premier trading houses, to import the yellow metal. However, the existing guidelines stating that importers can import gold, provided that 20% of it is exported as finished products, remain intact.
Jindal Steel & Power is seeking approval of shareholders by way of postal ballot for increasing the borrowing powers of the company to Rs 50000 crore, creation of security on the assets of the company in favour of the lenders and issuance of non convertible debentures on private placement basis up to Rs 10000 crore. The firm is also seeking approval for giving of loans/ guarantees and providing of securities and making of investments in securities up to Rs 20000 crore.
Deepak Nitrite said after market hours on Wednesday, 21 May 2014 that the company, after completion of successful trial runs of production at its new Greenfield Plant at Dahej. Dist. Bharuch in the state of Gujarat has commissioned balance capacities of Optical Brightening Agent (OBA) on 20 May 2014. Now the plant stands fully commissioned, it added.
Kalindee Rail Nirman (Engineers) said after market hours on Wednesday, 21 May 2014 that the Board of Directors of the company at its meeting held on 21 May 2014, has approved a Scheme of Amalgamation (Scheme), whereby the company shall be amalgamated into and with Texmaco Rail & Engineering (Texmaco). Texmaco is a shareholder holding 49.07% of the issued, subscribed and paid-up share capital of the company.
The aforesaid decision of the Board is based on the recommendation received from the Audit Committee and the Committee of Directors, which was formed by the Board on 2 May 2014 to explore various options for restructuring the company, its businesses and its operational and business relationship with Texmaco, so as to create better synergy within the company and between these entities, and to ensure that the businesses are operated in the most efficient and cost effective manner, with the ultimate aim and intent of enhancing shareholders value and improving the overall working culture/environment.
The Scheme shall result in the amalgamation of the company into and with Texmaco with effect from 1 April 2014. The share swap ratio is 1:1.06, i.e., 106 fully paid-up equity shares of Texmaco shall be issued for every 100 fully paid-up equity share held by a shareholder in the company. No shares shall be issued to Texmaco as a result of the Scheme, and post effectiveness of the Scheme, Texmaco's shareholding in the company shall stand cancelled.
The Scheme shall then be subject to necessary approval of the shareholders, creditors, and the approval and sanction of the Delhi High Court and the Calcutta High Court and other competent authorities, if any.
The broad market continued to depict strength even as the two key benchmark indices the edged lower in choppy trade on Wednesday, 21 May 2014. The S&P BSE Sensex lost 78.86 points or 0.32% to settle at 24,298.02, its lowest closing level since 16 May 2014.
Foreign institutional investors (FIIs) sold shares worth a net Rs 266.22 crore on Wednesday, 21 May 2014, as per provisional data from the stock exchanges.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014, as consumer-price inflation eased to a two-year low and as the rupee firmed up against the dollar.
After Bharatiya Janata Party (BJP) led National Democratic Alliance's (NDA) landslide victory in the recently concluded Lok Sabha election, investors are expecting measures from the incoming government to revive the Indian economy. There are expectations that Narendra Modi will be in a position to replicate the economic success he enjoyed in Gujarat state when he takes over as the country's Prime Minister. With Modi at the helm of affairs, Gujarat's economy expanded by 10.1% a year, on average and adjusting for inflation, from 2001 and 2012, compared with 7.7% growth a year for India's economy as a whole. India's GDP growth slowed sharply at 4.7% in Q3 December 2013. Investors hope that a BJP-led government would be able to accelerate policy reforms and overhaul the country's poor infrastructure. Investors will now be keenly watching policy announcements from the new government to drive a turnaround in the investment cycle.
Ever since NDA's victory in the election last week, speculation has been rife about the likely allocation of key ministerial portfolios in the Modi-led NDA government.
Modi will be sworn in as India's next Prime Minister on Monday, 26 May 2014, evening at the Rashtrapati Bhawan. India will invite the leaders of Pakistan and other neighbours to Narendra Modi's inauguration as prime minister, a spokeswoman for the Bharatiya Janata Party (BJP) said on Wednesday, 21 May 2014, in a bold step to embark on a policy of regional engagement. Pakistani Prime Minister Nawaz Sharif will be on the guest list of leaders from the eight-member South Asia Association for Regional Cooperation (SAARC) invited to attend Modi's swearing in next Monday, spokeswoman Nirmala Sitharaman said.
The first budget of the new government is expected by July 2014. An interim budget was presented by P. Chidambaram in February this year. Essentially, in the nature of a vote on account, the interim budget was intended to get Parliament approval for expenditure to be incurred during the first few months of fiscal year 2014-15 due to Lok Sabha elections.
Asian stocks edged higher on Thursday after Federal Reserve meeting minutes showed policy makers see a muted risk of inflation from continued U.S. stimulus and a China manufacturing gauge rose to a five-month high in May. Key benchmark indices in Taiwan, Hong Kong, China, Singapore, Japan, Indonesia and South Korea rose by 0.16% to 1.6%.
The China manufacturing purchasing managers' index released today by HSBC Holdings Plc and Markit Economics delivered a provisional reading of 49.7 for May, rising from 48.1 in April. Readings below 50 indicate contraction.
US stocks rebounded on Wednesday from the previous day's losses and ended the session with solid gains, led by advances in the consumer discretionary and energy sectors.
Federal Reserve officials examined several approaches for the eventual tightening of monetary policy but only decided to be flexible, according to the minutes from the April meeting released Wednesday that suggested that the time for higher interest rates is drawing closer. Fed officials emphasized the need for base decisions on experience because of the unprecedentedly large size of the central bank's balance sheet.
According to the minutes, a number of Fed officials said it would be important for the Fed to communicate still more clearly about the Fed's policy intentions as the time of the first increase in the federal funds rate moves closer. In the minutes, the Fed made no decisions on which tools to use.
Minutes from the April 29-30 meeting showed that officials were looking past the weak first-quarter gross domestic product report and seeing an economy picking up in steam.
William Dudley, the president of the New York Fed, touched on the subjects discussed in a speech in New York on Tuesday. Dudley said outright sales of MBS (mortgage-backed securities) are no longer contemplated, and that the Fed shouldn't stop reinvesting payments of principal before rates are lifted as had been the plan in July 2011. In fact, he suggested the Fed may want to lift interest rates before stopping the reinvestment.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 17-18 June 2014. The Fed on 30 April 2014 said after a monetary policy review that it will keep the benchmark interest-rate target at almost zero for a "considerable time" after its bond-buying program ends. The FOMC also reduced 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.
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