The market is likely to open lower as trading resumes after a long weekend as India's stock market had remained closed on Friday, 25 September 2015, on account of Bakri Id. Trading of CNX Nifty futures on the Singapore stock exchange indicates that the Nifty could fall 38 points at the opening bell.
In overseas markets, Asian markets were trading lower on concerns of deepening slowdown in China. Markets in Hong Kong, Taiwan and South Korea are closed for holiday. US markets ended on a mixed note on Friday, 25 September 2015 due to a sharp sell-off in biotech and healthcare stocks. Prospects for the US economy generally appear solid, Federal Reserve Chairwoman Janet Yellen said in her speech late Thursday, 24 September 2015 after US markets had closed. She argued in favor of hiking interest rates this year, giving more clarity to Fed watchers.
Foreign portfolio investors (FPIs) sold shares worth a net Rs 115.10 crore on Thursday, 24 September 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 50.67 crore on Thursday, 24 September 2015, as per provisional data.
Amid a divergent trend among various index constituents, the barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty clocked small gains on Thursday, 24 September 2015. The Sensex rose 40.51 points or 0.16% to settle at 25,863.50, its highest closing level since 21 September 2015.
Among the key domestic upcoming event, the Reserve Bank of India's (RBI) fourth bi-monthly monetary policy review for the year 2015-16 is scheduled tomorrow, 29 September 2015. The RBI had kept its benchmark lending rate viz. the repo rate unchanged at 7.25% after a monetary policy review on 4 August 2015. RBI Governor Dr. Raghuram G. Rajan had at that time indicated in his written monetary policy statement that going ahead RBI will monitor developments for emerging room for further reduction in the policy rate. The RBI has cut the benchmark lending rate viz. the repo rate by 75 basis points since January 2015.
Among stocks and sectors, Bharat Heavy Electricals (Bhel) announced on Friday, 25 September 2015, that it successfully commissioned a 250 megawatts (MW) coal-based thermal power plant in Gujarat. The unit has been commissioned at Gujarat State Electricity Corporation's (GSECL) Sikka Thermal Power Station (TPS) by Bhel, on Engineering, Procurement and Construction (EPC) basis. Sikka TPS is located near Jamnagar in Gujarat.
This is the second unit of 250 MW rating to be commissioned by Bhel at Sikka TPS. The company had earlier commissioned the first 250 MW unit at Sikka in March, 2015. In addition, two units of 120 MW each, supplied and executed earlier by Bhel, are already in operation at Sikka.
Bank stocks will be in focus after the Reserve Bank of India (RBI) announced measures to enhance commercial banks' ability to recover loans to borrowing entities which are under stress primarily due to operational/managerial inefficiencies of the existing promoters. The RBI has allowed banks to upgrade the credit facilities extended to the borrowing entities whose ownership has been changed to 'Standard' category, subject to certain conditions. The RBI has also allowed banks to refinance the existing debt of the borrowing entity whose ownership has been changed without treating the exercise as restructuring of loan. However, banks will have to make provisions for any diminution in fair value of the existing debt on account of the refinance. The RBI has also allowed banks to reverse the provision made against the loans to the borrowing entity whose ownership has been changed once all the outstanding loan/facilities of the borrowing entities perform satisfactorily during the specified period as defined in the extant norms on restructuring of advances.
Separately, the RBI has allowed commercial banks to provide partial credit enhancement (PCE) to bonds issued by corporates/special purpose vehicles (SPVs) for funding all types of projects, subject to certain conditions. Initially, banks will be allowed to offer PCE only in the form of a non-funded irrevocable contingent line of credit. The RBI will in due course take a call on whether to allow PCE as a funded loan facility.
Adani Ports and Special Economic Zone (APSEZ) replaces NMDC as a constituent in the 50-unit CNX Nifty index with effect from today, 28 September 2015.
Power Grid Corporation of India (PGCIL) said after market hours on Thursday, 24 September 2015 that Pole-I of 800kV Agra-Bishwanath Chariali HVDC Line has been completed and power flow has commenced. This project is first 800kV HVDC Transmission Line in the country and world's longest multi terminal HVDC transmission line with line length of about 1,750 kilometres (KM) and capacity of 6,000 MW HVDC bipole line from Bishwanath Chariali (3,000 MW HVDC Station) in Assam to Agra (6,000 MW HVDC Station) in UP via Alipurduar (3,000 MW) in West Bengal, PGCIL said.
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