Key benchmark indices held firm in mid-afternoon trade as firmness in European stocks and higher US index futures boosted market sentiment. A sharp recovery of rupee against the dollar also supported domestic bourses. The barometer index, the S&P BSE Sensex, was currently well above the psychological 21,000 mark, having alternately moved above and below that mark earlier during the session. The Sensex was up 250.41 points or 1.2%, up about 255 points from the day's low and off close to 25 points from the day's high. The market breadth, indicating the overall health of the market, was positive.
Bharti Airtel rose after the company said that "Airtel Networks Kenya ("Airtel Kenya") has sought an approval from the Communications Authority of Kenya (CAK), to acquire the telecommunications licenses and subscribers of Essar Telecom Kenya, which operates under the brand name 'yuMobile'. Hindalco Industries extended intraday gains. IT stocks edged higher on positive economic data in US, the biggest outsourcing market for the Indian IT firms.
The market edged higher in early trade. It hovered in positive terrain in morning trade. It extended gains and hit fresh intraday high in mid-morning trade. It further strengthened and hit fresh intraday high in early afternoon trade. Key benchmark indices extended gains and hit fresh intraday high in afternoon trade in afternoon trade. The Sensex and the 50-unit CNX Nifty, both, hit their highest level in 5-1/2 weeks. It held firm in mid-afternoon trade.
The market sentiment was boosted by data showing that foreign funds remained net buyers of Indian stocks on Monday, 3 March 2014. Foreign institutional investors (FIIs) bought shares worth a net Rs 198.53 crore on Monday, 3 March 2014, as per provisional data from the stock exchanges.
At 14:20 IST, the S&P BSE Sensex was up 250.41 points or 1.2% to 21,197.06. The index rose 276.24 points at the day's high of 21,222.89 in afternoon trade, its highest level since 24 January 2014. The index dropped 6.26 points at the day's low of 20,940.39 in early trade.
The CNX Nifty was up 70.60 points or 1.13% to 6,292.05. The index hit a high of 6,299.75 in intraday trade, its highest level since 24 January 2014. The index hit a low of 6,215.70 in intraday trade.
The BSE Mid-Cap index rose 75.39 points or 1.16% to 6,556.04. The BSE Small-Cap index rose 62.87 points or 0.97% to 6,512.03. Both these indices underperformed the Sensex.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,432 shares gained and 1,061 shares fell. A total of 156 shares were unchanged.
Among the 30-share Sensex pack, 27 stocks rose and rest of them fell. AXIS Bank (up 3.76%), Sesa Sterlite (up 3.84%), and ICICI Bank (up 3.54%) edged higher from the Sensex pack.
IT stocks edged higher on positive economic data in US, the biggest outsourcing market for the Indian IT firms. Infosys (up 0.2%), TCS (up 0.25%), and Wipro (up 0.74%) gained. HCL Technologies (down 0.96%) and Tech Mahindra (down 0.33%) declined.
Hindalco Industries rose 6.07%, with the stock extending intraday gains.
Bharti Airtel rose 0.65% after the company said during market hours that "Airtel Networks Kenya ("Airtel Kenya") has sought an approval from the Communications Authority of Kenya (CAK), to acquire the telecommunications licenses and subscribers of Essar Telecom Kenya, which operates under the brand name 'yuMobile'.
The proposed arrangement envisages over 2.7 million customers of Essar Telecom Kenya becoming part of Airtel Kenya's mobile network. The proposed association will undergo seamless integration once definitive agreements are signed, and requisite regulatory and statutory approvals are received."
In the foreign exchange market, the rupee reversed intraday losses against the dollar. The partially convertible rupee was hovering at 61.86, compared with its close of 62.04/05 on Monday, 3 March 2014.
Markit Economics will unveil the result of a monthly survey on the performance of India's services sector for February 2014 tomorrow, 5 March 2014. The HSBC Services Business Activity Index increased from December's 46.7 to 48.3 in January 2014.
Reserve Bank of India next undertakes monetary policy review on 1 April 2014. Citing price pressures, the Reserve Bank of India raised its key lending rates by 25 basis points after Third Quarter Review of Monetary Policy for 2013-14 on 28 January 2014.
European stocks rose on Tuesday, rebounding from their biggest loss in more than five weeks on Monday, as investors watched the military standoff in Ukraine. Key benchmark indices in France, Germany and UK rose 0.99% to 1.22%.
A policy meeting of the Governing Council of the European Central Bank (ECB) will be held on Thursday, 6 March 2014, in Frankfurt to decide euro zone interest rates. European Central Bank President Mario Draghi recently signaled the central bank's March policy meeting could be critical in determining whether the ECB will provide additional stimulus to shore up the nascent euro-zone economic recovery.
A two-day meeting of Bank of England's Monetary Policy Committee (MPC) will be held on Wednesday 5 March 2014 and Thursday 6 March 2014 to decide interest rates in UK. Policy rates are expected to remain unchanged at record low. The UK's central bank slashed interest rates to record low of 0.5% at the height of the financial crisis in 2009.
Asian stocks were mostly higher on Tuesday as investors weighed the crisis in Crimea and ahead of the National People's Congress annual meeting in China starting tomorrow. Key benchmark indices in Indonesia, Singapore, Japan and Hong Kong rose 0.47% to 0.7%. Key benchmark indices in China, Taiwan and South Korea were off 0.18% to 0.55%.
Investors are considering signs of a global economic recovery against tension in the Crimea after Ukraine said Russia has 16,000 troops onto its soil and that Russian forces are threatening to seize its warships. Crimea, where ethnic Russians comprise the majority, has become the focal point of Ukraine's crisis after an uprising triggered last month's ouster of President Viktor Yanukovych. Ukraine has mobilized its army and called for foreign observers after Russian forces took control of the peninsula. Russia, which keeps its Black Sea fleet at Sevastopol, raised its key interest rate yesterday as asset prices plummeted.
A meeting of China's lawmakers to set economic policy and growth targets begins tomorrow, 5 March 2014. The latest meeting of the legislature, the first to be overseen by President Xi Jinping and Premier Li Keqiang, comes as leaders pledge to give markets a "decisive" role in the economy. Investors will be watching the National People's Congress (NPC) meeting for clues to the next steps to fix local-government finances, charge market prices for natural resources, rein in shadow-banking risks, free up deposit rates and open up state businesses to private investment.
Australia's central bank reiterated that it's likely to maintain a period of record-low interest rates and renewed a reference to the currency's strength. Governor Glenn Stevens and his board kept the overnight cash-rate target at 2.5%, saying in a statement that housing prices have increased significantly and the Aussie remains high by historical standards.
Trading in US index futures indicated that the Dow could gain 120 points at the opening bell on Tuesday, 4 March 2014. US stocks sank the most in a month, joining a global selloff in equities on Monday, as investors sought havens on concern that Russia's military presence in Ukraine could lead to a larger conflict.
Data in the US Monday showed manufacturing expanded at a faster pace than projected in February, a sign the industry was beginning to overcome bad weather across much of the country. The Institute for Supply Management's manufacturing index rose to 53.2 in February from 51.3 a month earlier. Readings above 50 signal expansion. A separate report indicated consumer spending rose 0.4% in January after a 0.1% gain the prior month.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review on 18-19 March 2014. After a monetary policy review, the FOMC on 29 January 2014 announced it will reduce monthly bond purchases by another $10 billion to $65 billion.
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