Trading of CNX Nifty futures on the Singapore stock exchange indicates that the Nifty could gain 9.50 points at the opening bell. Asian stocks were trading mixed today, 23 February 2015.
Hindalco Industries will be focus after the company won the Gare Palma IV/4 coal block in Chhatisgarh for Rs 3,001 per tonne, according to the results of e-Auction for Schedule II coal mines announced by the Ministry of Coal on Friday, 20 February 2015. The coal ministry has started auctioning coal blocks after the Supreme Court in September last year cancelled the allocation of more than 200 coal mines allotted between 1993 and 2010 after ruling that they were arbitrary and illegal.
Shares of Idea Cellular and Yes Bank may edge higher and stock prices of DLF and Jindal Steel & Power (JSPL) may edge lower after the index maintenance sub-committee of India Index Services & Products (IISL) Friday, 20 February 2015, announced changes in the constituents of the 50-unit CNX Nifty index. IISL said Idea Cellular and Yes Bank will enter the Nifty index in place of DLF and JSPL with effect from 27 March 2015. Nifty based index mutual funds will have to rebalance their portfolio by including Idea Cellular and Yes Bank and exiting DLF and JSPL. An index fund is a passively managed mutual fund scheme in which the scheme's portfolio mirrors the index.
ING Vysya Bank and Kotak Mahindra Bank, separately, announced after market hours on Friday, 20 February 2015, that Competition Commission of India (CCI) has approved the proposed combination in the nature of merger of ING Vysya Bank with Kotak Mahindra Bank under Section 31 (1) of the Competition Act, 2002. Kotak Mahindra Bank and ING Vysya Bank had announced amalgamation of ING Vysya with Kotak in the ratio of 725 shares of Kotak for every 1,000 shares of ING Vysya.
Coal India (CIL) will be in focus after the company's Chairman & Managing Director (CMD) S Bhattacharya on Friday, 20 February 2015, said that the key issues that the coal miner is relying on to attain the 1 billion tonnes coal production target by 2019-20 are timely completion of three critical railway lines and timely land acquisition and green clearances. CIL had announced at the fag end of the trading session on Friday, 20 February 2015, that an amount of around Rs 6000 crore has been earmarked by CIL for railway and other infrastructure development for the year 2015-16. He further added that the process of identification of projects to share the balance quantity, to top up the 1 billion tonnes mark, is also underway. The two CIL subsidiaries Sambalpur based Mahanadi Coalfields and the Bilaspur based South Eastern Coalfields (SECL) are expected to play a pivotal role in CIL's quest of attaining the 1 billion tonnes production with 250 MTs and 240 MTs respectively.
Power Grid Corporation of India (PGCIL) on Saturday, 21 February 2015 said that its board of directors will meet on 4 March 2015, inter alia, to consider and approve the declaration of interim dividend for the financial year 2014-15.
Jindal Steel & Power (JSPL) after market hours on Friday, 20 February 2015 in a clarification with regard to news item titled "JSPL Retains 2 Blocks, Hindalco Bags one" said that as per the information published in the website of Nominated Authority to the Central Government, Jindal Power, a subsidiary of JSPL has been declared as the successful bidder for the Coal Block of Gare Palma IV/2 and IV/3. However in respect of the Coal Block of Gare Palma IV/1 of JSPL, the company has not qualified for the e-auction round on the basis of initial price offer submitted by it, JSPL said.
Public Sector Banks (PSBs) will be in focus. The Union Finance Minister Arun Jaitley on Saturday, 21 February 2015, made an appeal to all the employees of PSBs and their Unions & Associations not to resort to agitation approach by participating in bank strike. He informed the employees of PSBs that banks are already in negotiations with their Unions and Associations for wage settlement. Jaitley said that the bipartite negotiations in a cordial manner is the only available tool for settlement. Jaitley said that participating in the proposed strike is neither desirable nor affordable in the interest of the nation. Making an another appeal to the employees of PSBs, their Unions and Associations, the Finance Minister asked them not to resort to such disruptive means, and call off the call for strike.
PSB employee unions had on Friday, 20 February 2015 threatened to go on a four-day nation-wide strike beginning 25 February 2015 to press for their wage-related demands.
Shares of NBFC companies including Cholamandalam Investment and Finance Company, Sundaram Finance, Bajaj Finance, Reliance Capital, Aditya Birla Nuvo, Shriram Transport Finance, Mahindra & Mahindra Financial Services and L&T Finance Holdings among others will be in focus after the Reserve Bank of India (RBI) on Friday, 20 February 2015, said it has reviewed the existing guidelines on private placement of non-convertible debentures (NCDs) by non-banking financial companies (NBFCs) and said that the minimum subscription per investor in an NCD issue shall be Rs 20,000. As per the revised guidance, the issuance of private placement of NCDs by NBFCs shall be in two separate categories -- those with a maximum subscription of less than Rs 1 crore and those with a minimum subscription of Rs 1 crore and above per investor. In respect of issuance of NCDs with a maximum subscription of less than Rs 1 crore, a limit of 200 subscribers for every financial year has been set and the subscription needs to be fully secured, the RBI said. In respect of issuances of NDCs with a minimum subscription of Rs 1 crore and above, there will be no limit on the number of subscribers and the option to create security in favour of subscribers will be with the issuers. The RBI further said that such unsecured debentures will not be treated as public deposits as defined in NBFCs Acceptance of Public Deposits (Reserve Bank) Directions, 1998.
The RBI said that an NBFC (excluding Core Investment Companies) will be allowed to issue debentures only for deployment of funds on its own balance sheet and not to facilitate resource requests of group entities/parent company/associates. Further, an NBFC is not allowed to give loans against the security of its own debentures (issued either by way of private placement or public issue).
The market may remain volatile this week as traders roll over positions in the futures & options (F&O) segment from the near month February 2015 series to March 2015 series. The near month February 2015 derivatives contracts expire on Thursday, 26 February 2015.
The stock exchanges have decided to keep the stock market open on Saturday, 28 February 2015, just like any other normal trading session when the Finance Minister Arun Jaitley presents the first full-fledged Budget of the Narendra Modi government. Trading will start at 9:15 IST and conclude at 15:30 IST. Jaitley will begin his speech at 11:00 IST in Lok Sabha on 28 February 2015 as he tables the Union Budget 2015-16 in the parliament.
The Budget session of parliament begins today, 23 February 2015, with the Address of President of India Pranab Mukherjee to the members of both the Houses of Parliament in the Central Hall of Parliament.
The next major event for the financial markets is Union Budget for 2015-16. Finance Minister Arun Jaitley will present Union Budget 2015-16 in Parliament on Saturday, 28 February 2015. Analysts will scrutinize measures in the Budget for financing infrastructure projects as well as the government's own capital expenditure on infrastructure for the year ahead. This is the first full fledged Budget of the Narendra Modi government and analysts will look for a roadmap for economic growth for the next few years.
Changes in rates of dividend distribution tax, capital gains tax on sale of shares, Securities Transaction Tax (STT) and Minimum Alternate Tax (MAT), if any, will be closely watched. The dividend distribution tax is currently at 15%. The minimum alternate tax is currently at 18.5% of book profits. Short term capital gains tax on sale of shares is currently at 15% while there is zero long capital gains tax on sale of shares held for a period of more than one year.
The Budget session of Parliament will be held in two phases. The first phase will be from 23 February till 20 March and the second phase from 20 April till 8 May. There will be 20 working days during the first phase and 13 in the second phase.
The Budget session of the parliament assumes utmost importance as the government intends to replace the ordinances it had promulgated after the conclusion of the winter session of the parliament with Bills and get them cleared by both Houses of Parliament during the budget session. The Narendra Modi government promulgated a slew of ordinances after the last session of Parliament. Some of the key ordinances include raising the FDI in the insurance sector from 26% to 49%, e-auctioning of coal mines and amendment to the Land Acquisition Act.
The government has already started auctioning coal blocks for captive mining. The Coal Mines (Special Provisions) Bill that was moved to replace an ordinance issued earlier was passed by the Lok Sabha in the winter session but it could not be taken up in the Rajya Sabha. The government promulgated the Coal Mines (Special Provisions) Ordinance, 2014, in October to facilitate coal block auctions after the Supreme Court cancelled 204 coal blocks in September.
Through another ordinance, the government has raised the ceiling on foreign investment in the insurance sector to 49% from 26%. The government was unable to get the Insurance Laws (Amendment) Bill, 2008, passed in parliament during the winter session.
Amendments to the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 were brought in via an ordinance after the winter session of the parliament.
Analysts are also awaiting further progress on the Goods and Services Tax (GST) in the Budget session after the Constitution Amendment Bill for the introduction of GST was tabled in the Lok Sabha during the winter session of parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. Central taxes like Central Excise Duty, Additional Excise Duties, Service Tax, Additional Customs Duty (CVD) and Special Additional Duty of Customs (SAD), etc. will be subsumed in GST. At the state level, taxes like VAT/Sales Tax, Central Sales Tax, Entertainment Tax, Octroi and Entry Tax, Purchase Tax and Luxury Tax, etc. would be subsumed in GST.
The Railway Budget 2015-16 will be tabled in the parliament by the rail minister Suresh Prabhu on Thursday, 26 February 2015. The Economic Survey will be tabled on Friday, 27 February 2015.
Amid uncertainty over Greece's future in the eurozone, key equity benchmark indices in India edged lower on the last trading session of the week on Friday, 20 February 2015. The S&P BSE Sensex lost 230.86 points or 0.78% to settle at 29,231.41, its lowest closing level since 16 February 2015.
Foreign portfolio investors (FPIs) sold shares worth a net Rs 89.41 crore on Friday, 20 February 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 204.85 crore on Friday, 20 February 2015, as per provisional data.
Asian stocks were trading mixed today, 23 February 2015. Key benchmark indices in Singapore, Hong Kong and Indonesia fell by 0.05% to 0.54%. Key benchmark indices in South Korea and Japan rose by 0.43% to 0.87%. Markets in China and Taiwan remained shut today, 23 February 2015 for the Lunar New Year holidays.
US stocks rallied on Friday, 20 February 2015 sending the S&P 500 and Dow Jones Industrial Average to record levels on news that eurozone ministers agreed to a four-month extension of Greece's bailout.
Investors will receive further clues on the central bank's assessment of the economy and the timing of a rate increase when Federal Reserve Chair Janet Yellen gives two days of testimony to Congressional finance committees starting tomorrow, 24 February 2015.
Euro-area finance ministers on Friday, 20 February 2015 reached an agreement intended to keep aid flowing to Greece for four months in return for a commitment to budget targets, buying time to work out the details of longer-term financing. Greece now has to provide a list of reform measures to euro zone by today, 23 February 2015 to secure financing. European finance chiefs will then decide whether the proposals go far enough or trigger another round of emergency negotiations this week. The Greek reform measures are still subject to validation by the International Monetary Fund, the European Central Bank and the European Commission, the institutions collectively known as the troika that Prime Minister Alexis Tsipras vowed not to recognize.
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