Weakness continued on the bourses in mid-afternoon trade. The barometer index, the S&P BSE Sensex, was down 70.21 points or 0.31%, up about 90 points from the day's low and off close to 120 points from the day's high. The market breadth, indicating the overall health of the market, was even. Indian stocks fell today, 29 April 2014, extending their recent losses triggered by the India Meteorological Department (IMD) on Thursday, 24 April 2014, announcing that the country will likely get below-normal levels of monsoon rain this year. Investors also maintained caution ahead of the announcement of Federal Reserve's monetary policy review tomorrow, 30 April 2014. Most Auto stocks declined.
The market dropped in early trade. It extended initial losses and hit fresh intraday low in morning trade. The Sensex and the 50-unit CNX Nifty, both, hit their lowest level in almost two weeks. It languished in the negative terrain in mid-morning trade. It trimmed intraday losses in early afternoon trade. Key benchmark indices continued hovering in negative territory in afternoon trade. It remained weak in mid-afternoon trade.
Foreign institutional investors (FIIs) bought shares worth a net Rs 77.02 crore on Monday, 28 April 2014, as per provisional data from the stock exchanges.
At 14:20 IST, the S&P BSE Sensex was down 70.21 points or 0.31% to 22,561.40. The index fell 161.18 points at the day's low of 22,470.43 in morning trade, its lowest level since 17 April 2014. The index rose 50.28 points at the day's high of 22,681.89 in early trade.
The CNX Nifty was down 18.35 points or 0.27% to 6,742.90. The index hit a low of 6,711.10 in intraday trade, its lowest level since 17 April 2014. The index hit a high of 6,779.70 in intraday trade.
The BSE Mid-Cap index was up 26.60 points or 0.36% to 7,465.09. The BSE Small-Cap index was up 44.07 points or 0.58% to 7,661.35. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was almost even. On BSE, 1,288 shares rose and 1,290 shares fell. A total of 127 shares were unchanged.
Among the 30-share Sensex pack, 18 stocks declined and rest of them rose. Tata Steel (down 3.82%), Hindustan Unilever (down 2.94%), and Hindalco Industries (down 2.02%), edged lower from the Sensex pack.
Most Auto stocks declined. Tata Motors (down 0.83%), Ashok Leyland (down 0.43%), and Maruti Suzuki India (down 1.18%) declined. Mahindra & Mahindra (M&M) rose 0.2%.
Bajaj Auto shed 2%. With reference to the earlier announcement dated 18 April 2014 regarding propose to call for a stoppage of work by all the workmen employed in Chakan plant, Bajaj Auto has now informed that the company has received a notice dated 27 April 2014 from the workmen's union of its Chakan plant viz., Vishwa Kalyan Kamgar Sanghatana stating that the stoppage of work in the Chakan plant of the company has been postponed to 15 May 2014.
Hero MotoCorp dropped 0.7%. TVS Motor Company gained 5.69%.
IRB Infrastructure Developers rose 3.21% after the company said it has emerged as a preferred bidder and received letter of award from NHAI for the project of four laning of Yedeshi - Aurangabad section. The announcement was made after trading hours on Monday, 28 April 2014.
IRB Infrastructure Developers said that the company has emerged as a preferred bidder and received letter of award from National Highways Authority of India (NHAI) for the project of four laning of Yedeshi -Aurangabad section of NH-211 from km 100.000 to km 290.200 (Design Length 190 km) in the State of Maharashtra to be executed as BOT (Toll) on DBFOT Pattern under NHDP Phase -IV.
The estimated project cost of the company is approximately Rs 3200 crore, concession period is 26 years and construction period is 910 days, IRB Infrastructure Developers said in a statement. IRB Infrastructure Developers has sought Rs 558 crore as viability gap funding from NHAI, the company said.
IRB Infrastructure Developers' consolidated net profit fell 24% to Rs 108.52 crore on 4.3% decline in total income to Rs 905.91 crore in Q3 December 2013 over Q3 December 2012.
HCL Infosystems lost 4.02% after net profit rose 11.3% to Rs 2.56 crore on 8.42% decline in income from operations to Rs 1316.49 crore in Q3 March 2014 over Q2 December 2013. The Q3 result was announced after market hours on Monday, 28 April 2014.
The net profit in Q3 March 2014 was boosted by an exceptional gain of Rs 21.57 crore in Q3 March 2014. There was a profit of Rs 26.19 crore on sale of properties while there was an inventory writeoff of Rs 4.62 crore due to phasing out of a product line.
Commenting on the results, Mr. Harsh Chitale, Managing Director and Chief Executive Officer, HCL Infosystems said, "Our transformation story is progressing well and is now taking roots. Distribution and Services, our focused growth areas have registered healthy traction. Our portfolio diversification strategy in Distribution continues to yield results as our non-telecom distribution business achieved a 12% QoQ and 25% YoY growth. Though our Telecom Distribution business did register a decline in topline, the gross margin expanded on account of increase in scope of engagement. As part of a new initiative, the Telecom Distribution business enrolled 88 new rural distributors in JFM Quarter that will further strengthen its footprint in the country. Our Enterprise Services also grew by 8% QoQ and 9% YoY on account of growth in our order book across India, MEA and South-East Asia. While our Break fix Services gained positive traction as a provider of multi-vendor technology support services, our Managed Services expanded its overseas foothold with a large contract in South East Asia. Our hardware-solutions businesses which we had decided to reduce focus on, are transitioning as per plan. However, business model transitions for these businesses led to repositioning charges in the current quarter and may impact next quarter as well".
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 60.51, compared with its close of 60.6450/65 on Monday, 28 April 2014.
The country will likely get below-normal levels of monsoon rain this year, the India Meteorological Department (IMD) said on Thursday, 24 April 2014. The IMD said that the rainfall during the June-September summer rainy season will likely be 95% of the long-term average for the country. India's weather department defines a normal monsoon as one with rainfall between 96% and 104% of the 50-year average, which is 89 centimeters this year. This year could be a below normal monsoon, the weather department said, as there is a 60% possibility of the emergence of the El Ni weather phenomenona warm weather system that starts in the southern Pacific can affect weather around the world. El Ni last affected India's monsoon in 2009 when the monsoon rainfall was 23% below normal.
Annual rains are important for India as most of its farmlands are dependent or rain for irrigation and more than half of its workforce is employed in agriculture. The monsoon rains usually arrive over the southern state of Kerala by the end of May or the first week of June, and gradually cover the entire country by July. The IMD will issue the update forecasts in June 2014 as a part of the second stage forecast. Along with the update forecast, separate forecasts for the monthly (July and August) rainfall over the country as a whole and seasonal (June-September) rainfall over the four geographical regions of India will also be issued.
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.
A major near term trigger for the stock market is the outcome of the upcoming Lok Sabha elections. The 36 days long voting process began on 7 April 2014 and will conclude on 12 May 2014. The results will be declared on 16 May 2014 after which India will get a new government. The term of the current Lok Sabha expires on 1 June and the new House has to be constituted by 31 May.
European shares were higher on Tuesday as a slew of corporate earnings helped to buoy sentiment ahead of a policy meeting by the US Federal Reserve. Key benchmark indices in UK and Germany were up by 0.35% to 0.66%. France's CAC 40 fell 0.02%.
Most Asian stocks edged lower on Tuesday as investors weighed corporate earnings. Key benchmark indices in Indonesia, South Korea and Singapore were off 0.11% to 0.3%. Key benchmark indices in China, Taiwan and Hong Kong rose 0.71% to 1.45%. Japanese markets were closed for a holiday.
Trading in US index futures indicated that the Dow could gain 32 points at the opening bell on Tuesday, 29 April 2014. US stocks rose, with the Standard & Poor's 500 Index erasing an earlier slide on Monday, 28 April 2014,, as Internet and smaller companies pulled back from a selloff amid optimism over merger activity.
A report by the National Association of Realtors showed contracts to purchase previously owned US homes climbed in March by the most in almost three years, showing residential real estate was starting to stabilize entering the spring selling season. The pending home sales index rose 3.4%, the first gain in nine months, after a 0.5% drop in February that was smaller than initially reported.
A two-day meet of the Federal Open Market Committee (FOMC) on monetary policy review resumes today, 29 April 2014. The Federal Reserve on 19 March 2014 decided after the conclusion of a monetary policy review to trim its monthly bond purchases by $10 billion to $55 billion.
Investors are also watching developments in Ukraine. The Obama administration imposed sanctions on seven Russian officials and 17 companies linked to Russian President Vladimir Putin's inner circle involved in banking, energy and infrastructure. The sanctions, announced by the White House, are being imposed in conjunction with the European Union, which said it is adding 15 names to its list of previously sanctioned individuals.
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