A bout of volatility was witnessed as key benchmark indices trimmed losses after hitting fresh intraday low in morning trade. The barometer index, the S&P BSE Sensex, was currently off 234.15 points or 0.79% at 29,228.12. The market breadth indicating the overall health of the market was positive.
Index heavyweight Reliance Industries edged lower on reports that the Delhi police yesterday, 19 February 2015, arrested five people and detained an employee of Reliance Industries among a number of other individuals on charges of leaking secret documents of Ministry of Petroleum & Natural Gas. FMCG stocks edged lower. Realty shares edged higher. SpiceJet surged after the Competition Commission of India (CCI) approved the proposed acquisition of entire shareholding of the company's existing promoters by Mr. Ajay Singh.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 1542.70 crore yesterday, 19 February 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) sold shares worth a net Rs 195.74 crore yesterday, 19 February 2015, as per provisional data.
In the foreign exchange market, the rupee edged higher against the dollar.
Brent crude oil futures edged higher on expectations that data later in the day would show a continuing decline in the US oil rig count, a clear sign of the pressure the tumble in crude is putting on oil producers.
In overseas markets, stocks in Japan and Indonesia edged higher as most other Asian markets remained closed for holiday. US stocks ended mostly lower in thinly-traded session yesterday, 19 February 2015, as investors grappled with a drop in oil prices and a continued impasse between Greece and its creditors over loans.
At 10:16 IST, the S&P BSE Sensex was down 234.15 points or 0.79% at 29,228.12. The index fell 284.01 points at the day's low of 29,178.26 in morning trade. The index fell 0.18 points at the day's high of 29,462.09 at the onset of trading session.
The CNX Nifty was down 56.65 points or 0.64% at 8,838.65. The index hit a high of 8,899.95 in intraday trade. The index hit a low of 8,816.30 in intraday trade.
The BSE Mid-Cap index was up 12.66 points or 0.12% at 10,845.27. The BSE Small-Cap index was up 13.96 points or 0.12% at 11,388.72. Both these indices outperformed the Sensex.
The market breadth indicating the overall health of the market was positive. On BSE, 1,075 shares advanced and 866 shares declined. A total of 72 shares were unchanged.
Index heavyweight Reliance Industries edged lower on reports that the Delhi police yesterday, 19 February 2015, arrested five people and detained an employee of Reliance Industries among a number of other individuals on charges of leaking secret documents of the Ministry of Petroleum & Natural Gas. The stock was off 3.15% at Rs 873. The stock hit a high of Rs 897 and a low of Rs 872.20 so far in intraday trade.
According to reports, the Delhi Police crime branch yesterday, 19 February 2015, unearthed a corporate espionage racket following the arrest of five persons who allegedly leaked confidential documents of the Ministry of Petroleum & Natural Gas. Meanwhile, the Government of India has reportedly launched a massive investigation into the alleged leak of top-secret documents to certain independent consultants and energy companies.
FMCG stocks edged lower. Godrej Consumer Products (down 1.76%), Jyothy Laboratories (down 1.26%), Dabur India (down 0.81%), Colgate-Palmolive (India) (down 0.7%), GlaxoSmithKline Consumer Healthcare (down 0.66%), Hindustan Unilever (down 0.53%), Britannia Industries (down 0.45%), Procter & Gamble Hygiene & Health Care (down 0.13%), Bajaj Corp (down 0.02%) and Nestle India (up 0.01%), edged lower. Marico (up 0.81%) and Tata Global Beverages (up 1.50%), edged higher.
Realty shares edged higher. Housing Development and Infrastructure (HDIL) (up 5.46%), Oberoi Realty (up 4.41%), Anant Raj (up 2.28%), DLF (up 1.93%), Unitech (up 1.93%), D B Realty (up 1.80%), Parsvnath Developers (up 1.24%), Indiabulls Real Estate (up 1.09%), Sunteck Realty (up 0.95%), Phoenix Mills (up 0.58%) and Peninsula Land (up 0.44%), edged lower. Prestige Estates (down 0.21%), Sobha (down 0.44%) and Godrej Properties (down 0.82%), edged lower.
SpiceJet surged 14.79% to Rs 22.90 after the Competition Commission of India (CCI) approved the proposed acquisition of entire shareholding of the company's existing promoters by Mr. Ajay Singh. The company made the announcement before market hours today, 20 February 2015. SpiceJet said it has been informed by Mr. Ajay Singh that CCI has approved the proposed combination and acquisition of entire shareholding of Mr. Kalanithi Maran and Kal Airways (i.e. existing promoters) aggregating to 58.46% by Mr. Ajay Singh.
Sunil Hitech Engineers rose 3.84% to Rs 156.70 after the company bagged a Rs 90 crore-order from Kanpur Development Authority for the construction and development work of houses in Kanpur. The company expects to complete the execution of the work in around 18 months. The company made the announcement after market hours yesterday, 19 February 2015,
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 62.2575, compared with its close of 62.34 during the previous trading session on Wednesday, 18 February 2015. The foreign exchange market was closed yesterday, 19 February 2015, for a bank holiday.
Brent crude oil futures edged higher on expectations that data later in the day would show a continuing decline in the US oil rig count, a clear sign of the pressure the tumble in crude is putting on oil producers. Brent for April settlement was up 44 cents at $60.65 a barrel. The contract had lost 32 cents or 0.53% to settle at $60.21 a barrel during the previous trading session.
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 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 upcoming 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.
In overseas markets, stocks in Japan and Indonesia edged higher as most other Asian markets remained closed for holiday. In Japan, the Nikkei 225 was up 0.33%. Indonesia's Jakarta Composite was up 0.55%. Chinese markets are closed for Lunar New Year holiday.
Trading in US index futures indicated that the Dow could fall 8 points at the opening bell today, 20 February 2015. US stocks ended Thursday's thinly-traded session mostly lower, as investors grappled with a drop in oil prices and a continued impasse between Greece and its creditors over loans. Meanwhile, mixed economic reports stoked uncertainty about the Federal Reserve's timetable for hiking rates.
Economic data in the US on Thursday was mixed. Weekly jobless claims report was better than expected. Meanwhile, leading US economic indicators edged up in January but the index pointed to some moderation in growth. Philadelphia Fed index disappointed, pointing the economy might have hit a soft patch.
In Europe, the impasse between Greece and is creditors continued, after Germany rejected Greece's request for a six-month loan extension agreement. The full Eurogroup of eurozone finance ministers is scheduled to meet again today, 20 February 2015. Greece has been making a distinction between a loan agreement and its bailout program, which is scheduled to end later this month.
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