Indian stocks edged higher for the second day in a row on positive cues from Asian and European markets. The barometer index, the S&P BSE Sensex, attained its highest closing level in nearly 14 weeks. The CNX Nifty settled above the psychological 6,000 level for the first in almost 14 weeks. The Sensex jumped 215.31 points or 1.09%, up close to 190 points from the day's low and off about 30 points from the day's high. Index heavyweight and cigarette major ITC scaled record high. Another index heavyweight Reliance Industries (RIL) also edged higher. The market breadth, indicating the overall health of the market, was positive. All the 13 sectoral indices on BSE were in the green.
Key benchmark indices gained for the second straight day today, 7 May 2013. From a recent low of 19,575.64 on 3 May 2013, the Sensex has gained 313.31 points or 1.6% in two trading sessions. The Sensex has gained 384.77 points or 1.97% in first four trading sessions of May 2013 (till 7 May 2013). The Sensex has gained 462.24 points or 2.37% in calendar 2013 so far (till 7 May 2013). From a 52-week high of 20,203.66 on 29 January 2013, the Sensex has declined 314.71 points or 1.55%. From a 52-week low of 15,748.98 on 4 June 2012, the Sensex has surged 4,139.97 points or 26.28%.
Coming back to today's trade, bank stocks edged higher. FMCG stocks also rose. Shares of liquor major United Spirits scaled record high. GlaxoSmithKline Pharmaceuticals pared gains after the company reported Q1 March 2013 result during market hours.
Key benchmark indices edged higher in early trade on positive Asian stocks. Key benchmark indices extended gains to strike fresh intraday high in morning trade. The market held firm in mid-morning trade. Firmness continued in early afternoon trade. The market trimmed gains after hitting fresh intraday high in afternoon trade. Key benchmark indices scaled fresh intraday high in mid-afternoon trade. The market extended gains in late trade.
The market sentiment was boosted by data showing that foreign funds remained net buyers of Indian stocks on Monday, 6 May 2013. Foreign institutional investors (FIIs) bought shares worth a net Rs 897.47 crore on Monday, 6 May 2013, as per provisional data from the stock exchanges.
The S&P BSE Sensex jumped 215.31 points or 1.09% to settle at 19,888.95, its highest closing level since 31 January 2013. The index jumped 244.24 points at the day's high of 19,917.88 in late trade. The index rose 23.69 points at the day's low of 19,697.33 in opening trade.
The CNX Nifty surged 72.50 points or 1.21% to 6,043.55, its highest closing level since 30 January 2013. The index hit a high of 6,050.50 in intraday trade. The index hit a low of 5,982.95 in intraday trade.
The BSE Mid-Cap index rose 0.84% and the BSE Small-Cap index gained 0.6%. Both these indices underperformed the Sensex.
All the 13 sectoral indices on BSE were in the green. The BSE FMCG index (up 2%), BSE Bankex (up 1.8%), BSE Realty index (up 1.4%) and BSE Auto index (up 1.12%), outperformed the Sensex. The BSE Metal index (up 0.08%), BSE IT index (up 0.27%), BSE PSU index (up 0.43%), BSE Oil & Gas index (up 0.48%), BSE Teck index (up 0.54%), BSE Power index (up 0.71%), BSE Consumer Durables index (up 0.76%), BSE HealthCare index (up 0.88%) and BSE Capital Goods index (up 0.9%), and underperformed the Sensex.
The total turnover on BSE amounted to Rs 1916 crore, higher than Rs 1817 crore on Monday, 6 May 2013.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,347 shares advanced and 1,047 shares declined. A total of 134 shares were unchanged.
Among the 30-share Sensex pack, 25 stocks gained while rest of them declined.
Index heavyweight Reliance Industries (RIL) rose 0.68% to Rs 827.10. The scrip hit high of Rs 835.65 and a low of Rs 819.40.
Index heavyweight and cigarette major ITC rose 2.73% to Rs 335.20. The stock hit record high of Rs 336 in intraday trade today, 7 May 2013. The Centre raised the excise duty on cigarettes by about 18% on all cigarettes except cigarettes of length not exceeding 65 mm in Union Budget 2013-14.
FMCG stocks edged higher on renewed buying. FMCG major Hindustan Unilever (HUL) rose 1.01% to Rs 579.10. The stock had hit record high of Rs 597 in intraday trade on 30 April 2013. The company's foreign parent Unilever PLC on 30 April 2013 announced open offer to acquire additional 48.70 crore shares, or 22.52% stake in Hindustan Unilever at Rs 600 per share. As on 31 March 2013, foreign promoters held 52.48% stake in HUL. After the open offer, holding of foreign promoters will rise to 75%.
HUL's net profit before exceptional items rose 18% to Rs 781 crore on 12.13% growth in total income from operations to Rs 6465.81 crore in Q4 March 2013 over Q4 March 2012. The company announced the Q4 results during market hours on 29 April 2013.
Emami gained 2.44%. The company's consolidated net profit rose 29.9% to Rs 93.99 crore on 13.2% rise in net sales to Rs 450.95 crore in Q4 March 2013 over Q4 March 2012. Emami's consolidated net profit rose 21.6% to Rs 314.74 crore on 16.9% rise in net sales to Rs 1699.10 crore in the year ended March 2013 over the year ended March 2012. The result was announced after market hours on Monday, 6 May 2013.
Meanwhile, Emami's board of directors at its meeting held on Monday, 6 May 2013, recommended issue of bonus shares in ratio of 1:2 i.e., one equity share for every two existing equity share held. The company's board of directors also recommended a dividend of Rs 8 per share for the year ended March 2013.
Marico (up 0.18%), Dabur India (up 2.6%), Godrej Consumer Products (up 1.21%) and Tata Global Beverages (up 1.02%) gained.
United Spirits rose 2.42% to Rs 2,343.25 after striking a record high of Rs 2,383.95 in intraday trade today, 7 May 2013.
Bank stocks were in demand. HDFC Bank gained 1.68%. ICICI Bank rose 1.54%. Axis Bank rose 2.78%.
Among PSU banks, Canara Bank (up 1.83%), Union Bank of India (up 0.77%), Bank of India (up 0.65%), Bank of Baroda (up 1.25%) and Punjab National Bank (up 1.4%) gained.
Shares of India's biggest commercial bank in terms of branch network, State Bank of India (SBI), rose 1.34%.
The government has directed Chairman cum Managing Directors of public sector banks and LIC to initiate immediate action against those employees exposed by Cobrapost, Red Spider 2 Expose. Online portal Cobrapost on Monday, 6 May 2013, claimed that its sting operation showed that a total of 23 major Indian banks, both public and private, and insurance companies are running a nation-wide money laundering racket. Financial Services Secretary Rajiv Takru, said in a directive issued to PSU banks and LIC, "Any officer/employee of your bank/institution who clearly appears to be advising potential customers along lines that would be an infringement of the legal process/could facilitate money laundering/could defeat the KYC norms or the norms of due diligence prescribed by RBI and the law from time to time, may be placed under suspension with immediate effect pending inquiry. The bank may initiate a detailed scrutiny of such officer's work and institute a special audit, if necessary, for this purpose. The inquiry must be initiated and completed expeditiously". The directive added, "Any officer/employee of your bank/institution who clearly appears to be advising potential customers along lines that would be an infringement of the legal process/could facilitate money laundering/could defeat the KYC norms or the norms of due diligence prescribed by RBI and the law from time to time, may be placed under suspension with immediate effect pending inquiry. The bank may initiate a detailed scrutiny of such officer's work and institute a special audit, if necessary, for this purpose. The inquiry must be initiated and completed expeditiously".
Cobrapost said its undercover investigation conducted for more than half a year, and spanning many states including Uttar Pradesh, Rajasthan, Delhi, Haryana, Andhra Pradesh and Karnataka, shows that money laundering practices are part and parcel of banking and insurance business across the board. Money laundering services are being offered by banks and insurance companies openly as a standard product across the board, Cobrapost said. The second round of secret videos have revealed violation of several provisions of the Income Tax Act, FEMA, RBI regulations, KYC norms, the Banking Act and Prevention of Money Laundering Act (PMLA), said Cobrapost in a press release.
The expose was the second by Cobrapost after the online portal had on 13 March 2013 alleged that HDFC Bank, ICICI Bank and Axis Bank were involved in money laundering.
Shares of Kotak Mahindra Bank rose 2.17% to Rs 727.60. Shares of Karnataka Bank fell 1.57% to Rs 154. Both the banks today, 7 May 2013, separately denied speculation of merger of the two private sector banks. Shares of Karnataka Bank had jumped 7.3% on Monday, 6 May 2013, on rumours that Kotak Mahindra Bank is in takeover talks with the bank.
IndusInd Bank rose 2.47% to Rs 485.10 after striking a record high of Rs 494 in intraday trade today, 7 May 2013.
Shriram Tarnsport Finance shed 0.07%. The company during market hours today, 7 May 2013 reported 16.63% rise in consolidated net profit to Rs 383.46 crore on 21.08% rise in total income to Rs 1908.05 crore in Q4 March 2013 over Q4 March 2012.
GlaxoSmithKline Pharmaceuticals rose 2.63% to Rs 2,378.45. The stock pared gains after striking a record high of Rs 2,522 in intraday trade today, 7 May 2013. The pharma company during market hours today, 7 May 2013, reported 37.53% rise in net profit to Rs 169.01 crore on 1.51% increase in total income to Rs 713.84 crore in Q1 March 2013 over Q1 March 2012. GlaxoSmithKline Pharmaceuticals profit before operations before other income and exceptional items fell 17.19% to Rs 163.45 crore in Q1 March 2013 over Q1 March 2012.
The company said the growth for the quarter was impacted by the core pharmaceuticals business, which was flat compared to the same period last year. There was a significant impact on growth due to supply chain related issue, the company said.
Lupin rose 2.07% to Rs 713.35, after scaling a record high of Rs 718 in intraday trade today, 7 May 2013. The stock gained ahead of its Q4 March 2013 results tomorrow, 8 May 2013.
Telecom stocks were in demand. Bharti Airtel surged 3.14%. The company on 3 May 2013 announced that it has entered into a binding agreement with Qatar Foundation Endowment (QFE), under which Bharti will issue 19.98 crore of its new shares to QFE representing a shareholding of 5% in the company, post issuance of the new shares. As per the agreement, QFE will subscribe to 19.98 crore new shares of Bharti at a price of Rs 340 per share amounting to a total consideration of $1.26 billion (Rs 6796 crore). The investment will further strengthen the capital structure and provide further flexibility for the company to deliver on its growth strategy, Bharti said.
Tata Teleservices (Maharashtra) jumped 3.5% after the Securities and Exchange Board of India provided some relaxation to the offer for sale norms to help the company achieve minimum public shareholding. The announcement was made after market hours on Monday, 6 May 2013.
Tata Teleservices (Maharashtra) (TTML) had sought relaxation from the market regulator the Securities and Exchange Board of India (Sebi) from certain condition applicable to offer for sale (OFS) of shares by promoters through the stock exchange mechanism. Sebi has relaxed the maximum allocation limit of 25% of the size of the OFS to a single investor. It has also permitted TTML to undertake two successive offers with a gap of minimum three days and has also relaxed restrictions with respect to the twelve week cooling off period. Promoters of TTML, who currently own 77.73% stake (as on 31 March 2013), are planning to sell their shares using the OFS route.
The promoter group of the company is allowed to sell the shares of the company up to 1% of the total paid-up share capital of the company on the floor of the stock exchange, subject to certain conditions prescribed in the letter, TTML said in a filing.
Sebi has mandated minimum public shareholding of 25% for private companies and 10% for state-run firms. As per the Sebi mandated minimum public shareholding rule, private-sector companies must cut founders' stake to adhere to the rules by 30 June 2013, while the deadline for state-run firms is 31 August 2013.
MTNL (up 1.54%) and Idea Cellular (up 0.04%) gained.
Reliance Communications fell 0.18% to Rs 112.55. The stock reversed direction after striking a 52-week high of Rs 113.90 in intraday trade today, 7 May 2013. The stock had risen 2.36% to settle at Rs 112.75 on Monday, 6 May 2013, on reports of the company raising tariff. According to reports, Reliance Communications has increased voice call prices on some of its plans by about 20% and cut promotional offers and discounts on some others by up to 65%.
Siemens declined 0.36%. The company said during market hours today, 7 May 2013, that it has fixed 15 May 2013 as the record date for the purpose of determining the shareholders of Winergy Drive Systems India to whom the equity shares of the company will be issued and allotted consequent upon the amalgamation of Winergy Drive Systems India with the company with effect from 31 March 2013.
Auto stocks were mixed. Tata Motors rose 2.58%. The company's total sales fell 15% to 51,160 in April 2013 over April 2012. Total domestic sales fell 17% to 47,595 in April 2013 over April 2012. Exports rose 28% to 3,565 during the period. The company announced the monthly sales data on 1 May 2013.
Car maker Maruti Suzuki India declined 0.07%. The company during market hours today, 7 May 2013, reported 7.58% fall in production to 1.05 lakh units in April 2013 over April 2012. The company's total sales fell 3.1% to 97,302 units in April 2013 over April 2012. The company's domestic sales rose 0.3% to 90,523 units in April 2013 over April 2012. Exports fell 33.3% to 6,779 units in April 2013 over April 2012. The company had announced its sales figures on 1 May 2013.
Mahindra & Mahindra (M&M) dropped 0.61%. M&M on Monday, 6 May 2013, announced the launch of the 'Bolero Maxi Truck Plus' (BMT Plus) -- a pick-up vehicle to cater to urban transportation needs. The vehicle has been priced at Rs 4.33 lakh (BS3) ex-showroom Thane and Rs 4.43 lakh (BS4), ex-showroom Mumbai excluding Octroi.
Speaking on the launch, Pravin Shah, Chief Executive, Automotive Division, M&M, said, "The Indian pick-up market is growing more rapidly than ever before and Mahindra has been leading this category (2-3.5 Ton GVW LCV segment) with a 54% market share during the year ended 31 March 2013. We have continuously updated and evolved our products to deliver greater value to our customers while retaining the basic tough and rugged DNA associated with Mahindra vehicles. The Bolero Maxi Truck Plus is aimed to cater to the transportation needs of the discerning urban city customer and will also meet the growing needs of current customers who want to upgrade and earn more. We are sure that the stylish new advanced Bolero Maxi Truck Plus will strengthen our Pickup portfolio and help consolidate our market share in this segment."
Two wheeler makers gained. Bajaj Auto rose 1.22%. The company's total sales fell 10% to 3.44 lakh units in April 2013 over April 2012. Motorcycle sales fell 12% to 3 lakh units in April 2013 over April 2012. Commercial vehicle sales rose 10% to 43,351 units in April 2013 over April 2012. Exports fell 23% to 1.30 lakh units in April 2013 over April 2012. The company announced the sales figures on 2 May 2013.
Hero MotoCorp advanced 3.65%. The company said on 1 May 2013 its total sales fell 9.5% to 4.99 lakh in April 2013 over April 2012.
The stock exchanges have decided to conduct a special trading session for a short duration on Saturday, 11 May 2013, as the Bombay Stock Exchange (BSE) is testing its disaster recovery software. Trading will start at 11:15 IST and end at 12:45 IST.
The focus of the market is on Q4 results. HDFC and Lupin unveil Q4 results tomorrow, 8 May 2013. Ranbaxy announces Q1 March 2013 results on the same day. Asian Paints and Punjab National Bank unveil Q4 results on Thursday, 9 May 2013. NTPC announces Q4 results on Friday, 10 May 2013. Bank of Baroda unveils Q4 results on 13 May 2013. Dr Reddy's Laboratories and Reliance Infrastructure unveil Q4 results on 14 May 2013. Bajaj Auto announces Q4 results on 16 May 2013. ITC unveils Q4 results on 17 May 2013. Bharat Heavy Electricals (Bhel) announces Q4 results on 23 May 2013. BPCL announces Q4 results on 29 May 2013. M&M and Tata Power unveil Q4 results on 30 May 2013.
Indian services sector growth eased sharply during April as new orders came in at a much slower pace, a business survey showed on Monday, 6 May 2013. The HSBC Services Purchasing Managers' Index, based on a survey of around 400 companies, fell to 50.7 in April 2013 from 51.4 in March 2013. Services make up over 60% of India's economy.
The Central Statistics Office (CSO) will issue data on industrial production for March 2013 on Friday, 10 May 2013. Industrial production rose 0.6% in February 2013.
The RBI on 3 May 2013 cut its key policy rate viz. the repo rate by 25 basis points (bps) to 7.25% and kept the cash reserve ratio (CRR) for banks unchanged at 4% after a monetary policy review. RBI said that the balance of risks stemming from its assessment of the growth-inflation dynamic provides little space for further monetary easing. The central bank said that with upside risks to inflation still significant in the near term in view of sectoral demand supply imbalances, ongoing correction in administered prices and pressures stemming from MSP increases, monetary policy cannot afford to lower its guard against the possibility of resurgence of inflation pressures. The RBI said it will endeavour to condition the evolution of inflation to a level of 5% by March 2014, using all instruments at its command.
The finance ministry in October 2012 announced a five-year plan to cut fiscal deficit. The government hopes to reduce the fiscal deficit to 3% by March 2017.
European stocks advanced on Tuesday, with London markets returning to action after a holiday and several companies reacting to earnings news. Key benchmark indices in France, Germany and UK rose by 0.4% to 0.87%. Stock markets in UK were closed for a holiday on Monday, 6 May 2013.
Asian stocks climbed for a second day today, 7 May 2013, dominated by Japanese shares, on optimism central banks will continue to revive growth. Key benchmark indices in Hong Kong, Singapore, Japan, China and Indonesia were up by 0.03% to 3.55%. Key benchmark indices in South Korea and Taiwan were down by 0.07% to 0.36%.
China is due to release a slew of economic data this week. The trade data for April 2013 will be out tomorrow, 8 May 2013. On Thursday, 9 May 2013, attention will shift to China's consumer and producer inflation figures for April 2013.
Trading in US index futures indicated that the Dow could gain 33 points at the opening bell on Tuesday, 7 May 2013. US stocks mostly advanced on Monday, with S&P 500 index extending its record run above 1,600 after the April jobs report exceeded expectations.
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