Key benchmark indices alternately swung between positive and negative zone near the flat line in early afternoon trade. The market breadth indicating the overall health of the market was negative. The barometer index, the S&P BSE Sensex, was currently down 2.89 points or 0.01% at 26,848.16. Brent crude prices fell for a second day in a row. Falling crude oil prices augur well for India as the country imports 80% of its crude oil requirement. Asian stocks were in red.
Shares of PSU banks rose after Finance Minister Arun Jaitley said in a newspaper interview published yesterday, 26 October 2014, that the government intends to bring down its stake in PSU banks to about 52% to enable PSU banks to raise capital to meet the Basel-III norms. Jindal Steel & Power tumbled on buzz the Central Bureau of Investigation (CBI) has begun a probe into how Congress leader Naveen Jindal's company got permission from the environment ministry under Jayanti Natarajan in 2013, during United Progressive Alliance's government to mine iron ore in Asia's largest sal forest in the Naxal-affected Saranda area of Jharkhand.
In overseas markets, Asian stocks declined on concerns of slowdown in China. US stocks edged higher on Friday, 24 October 2014, helped by earnings from Microsoft and Procter & Gamble and as concerns eased over the possible spread of Ebola in the United States.
Earlier, the Sensex and the 50-unit CNX Nifty had trimmed gains after hitting their highest level in almost five weeks at the onset of the trading session.
The market may remain volatile this week as traders roll over positions in the futures & options (F&O) segment from the near month October 2014 series to November 2014 series. The near month October 2014 derivatives contract expire on Thursday, 30 October 2014.
In the foreign exchange market, the rupee edged higher against the dollar.
Brent crude oil futures edged lower for the second day in a row on ample oil supplies.
At 12:17 IST, the S&P BSE Sensex was down 2.89 points or 0.01% at 26,848.16. The index fell 23.97 points at the day's low of 26,827.08 in mid-morning trade, its lowest level since 22 October 2014. The index jumped 143.91 points at the day's high of 26,994.96 at the onset of the trading session, its highest level since 23 September 2014.
The 50-unit CNX Nifty was down 0.85 points or 0.01% at 8,013.70. The index hit a low of 8,008.30 in intraday trade, its lowest level since 22 October 2014. The index hit a high of 8,064.40 in intraday trade, its highest level since 23 September 2014.
The BSE Mid-Cap index was off 37.26 points or 0.39% at 9,635.77. The BSE Small-Cap index was down 13.85 points or 0.13% at 10,648.80. Both these indices underperformed the Sensex.
The market breadth indicating the overall health of the market was negative. On BSE, 1,270 shares dropped and 1,131 shares rose. A total of 103 shares were unchanged.
Shares of PSU banks rose after Finance Minister Arun Jaitley said in a newspaper interview published yesterday, 26 October 2014, that the government intends to bring down its stake in PSU banks to about 52% to enable PSU banks to raise capital to meet the Basel-III norms. State Bank of India (SBI) (up 0.95%), Canara Bank (up 1.03%), Union Bank of India (up 2.24%), Bank of India (up 0.71%), Punjab National Bank (up 0.66%) Syndicate Bank (up 0.04%), Indian Overseas Bank (up 0.16%), Andhra Bank (up 3.18%), Oriental Bank of Commerce (up 0.99%), Dena Bank (up 1.05%), and Indian Bank (up 0.12%) gained.
Jindal Steel & Power tumbled 7.51% on buzz the Central Bureau of Investigation (CBI) has begun a probe into how Congress leader Naveen Jindal's company got permission from the environment ministry under Jayanti Natarajan in 2013 during United Progressive Alliance's government to mine iron ore in Asia's largest sal forest in the Naxal-affected Saranda area of Jharkhand.
Tata Motors dropped 2.02%. The company announced during market hours the pricing of a dual-tranche $750 million senior unsecured notes (Notes) following strong demand aggregating $4.50 billion for the offering that was launched and priced within a single day on 23 October 2014. The notes issued include $500 million Senior Unsecured Notes due 2020 at a coupon of 4.625% per annum and $250 million Senior Unsecured Notes due 2024 at a coupon of 5.75% per annum. The proceeds from the issuance and sale of the notes will be used to refinance external commercial borrowing of the company, incur new additional capital expenditure and for general corporate purposes. The notes are expected to be settled by 30 October 2014, Tata Motors said.
In the foreign exchange market, the rupee edged higher against the dollar. The rupee was hovering at 61.235, compared with its close of 61.28 during the previous trading session.
Brent crude oil futures edged lower for the second day in a row on ample oil supplies. Brent crude for December delivery was off 17 cents at $85.96 a barrel. The contract had lost 70 cents to settle at $86.13 a barrel on Friday, 24 October 2014. Global oil supply remains high despite persistent geopolitical risks in producers such as Iraq and Libya.
The government's decision this month to decontrol diesel prices and a sharp decline in global crude oil prices recently will help India in containing its fiscal deficit. The fall in global crude oil prices will also help India in containing its current account deficit and fuel price inflation. India imports 80% of its crude oil requirement.
Meanwhile, on the political front, the Election Commission of India on Saturday, 25 October 2014, announced schedule for assembly election in Jharkhand and Jammu & Kashmir. Polls in both the states will take place in five phases from 25 November 2014 to 20 December 2014. The results of polls in both these states will be announced on 23 December 2014.
Asian stocks declined today, 27 October 2014, on concerns of slowdown in China. Key benchmark indices in China, Hong Kong, Taiwan and Indonesia were off 0.21% to 0.78%. Key benchmark indices in South Korea and Japan were up 0.33% to 0.63%. Singapore's Straits Times was flat.
China's economic growth will slow to 7.2% in the current quarter, down from the previous three months, as domestic demand weakens, said Song Guoqing, an academic member of the People's Bank of China monetary policy advisory committee. The nation's economy will probably expand 7.3% next year, Song said at a forum in Beijing on 25 October 2014. That view contrasts with a prediction by Fan Jianping, chief economist at a state research institute, who said he expects 7% growth in 2015 unless the central government imposes stronger-than-expected stimulus measures.
Trading in US index futures indicated that the Dow could gain 17 points at the opening bell today, 27 October 2014. US stocks jumped on Friday, 24 October 2014, helped by earnings from Microsoft and Procter & Gamble and as concerns eased over the possible spread of Ebola in the United States.
A two-day meeting of the Federal Open Market Committee (FOMC) on US monetary policy review begins tomorrow, 28 October 2014. The Fed reduced monthly purchases for a seventh time to $15 billion at its September meeting, staying on course to end the quantitative-easing program this week as the central bank weighs the timing of interest-rate rises. Minutes from the last meeting, when policy makers pledged to keep US borrowing costs low for a considerable time, showed officials expressed concern that the economy may be at risk from a global slowdown.
In Europe, none of Europe's largest banks failed the European Central Bank's (ECB) stress test. The ECB released the results of the stress test yesterday, 26 October 2014.
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