A sudden slide in late trade took key benchmark indices lower. The barometer index, the S&P BSE Sensex, provisionally settled below the psychological 29,000 mark. The Sensex had reclaimed the psychological 29,000 mark after registering decent gains during the previous trading session on Monday, 13 April 2015. The Sensex and the 50-unit CNX Nifty, both, hit their lowest level in almost a week. A sudden slide during the last 40 minutes or so of the trading session materialized after benchmark indices reversed intraday losses in mid-afternoon trade, taking cues from gains in European stocks. Key benchmark indices had languished in red earlier during the trading session.
The Sensex was provisionally off 288.37 points or 0.99% at 28,756.07. The market breadth indicating the overall health of the market turned negative from positive in late trade. The BSE Mid-Cap and the BSE Small-Cap indices, both, slipped into the red from green in late trade. Earlier during the trading session, both these indices had hovered in green.
Index heavyweight and cigarette maker ITC rose. IT stocks declined after lower-than-expected US retail sales in March. PSU bank stocks rose in volatile trade. Private bank stocks were mixed.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 417.01 crore during the previous trading session on Monday, 13 April 2015, as per provisional data as per provisional data released by the stock exchanges. The stock market was closed yesterday, 14 April 2015, for a holiday. Domestic institutional investors (DIIs) bought shares worth a net Rs 46.42 crore during the previous trading session on Monday, 13 April 2015, as per provisional data.
On the macro front, data released by government today, 15 April 2015, showed that inflation based on the wholesale price index (WPI) remained in negative zone last month. The WPI data comes after data released by the government after trading hours on Monday, 13 April 2015, showed easing of consumer price inflation last month.
Meanwhile, Prime Minister Narendra Modi early this week said that India is trying to introduce an element of transparency and predictability in its taxation system.
In the foreign exchange market, the rupee edged higher against the dollar.
Brent crude oil futures edged higher after the International Energy Agency raised its demand growth estimate for 2015 by 90,000 barrels a day to 93.6 million barrels a day. The recent rise in global crude oil prices will raise concerns pertaining to India's fiscal deficit, current account deficit and fuel price inflation. However, gains in rupee against the dollar will mitigate the negative impact of higher crude oil price. Gains in local currency will reduce the cost of imports. India imports about 80% of its crude oil requirements.
In overseas markets, European stocks edged higher ahead of the latest policy announcement from the European Central Bank (ECB). Asian stocks were mixed. Most US stocks edged higher yesterday, 14 April 2015, as crude oil prices rose.
As per provisional closing, the S&P BSE Sensex was down 288.37 points or 0.99% at 28,756.07. The index lost 322.81 points at the day's low of 28,721.63 in late trade, its lowest level since 9 April 2015. The index gained 50.17 points at the day's high of 29,094.61 at onset of the trading session, its highest level since 13 March 2015.
The CNX Nifty was down 83.80 points or 0.95% at 8,750.20. The index hit a low of 8,722.40 in intraday trade, its lowest level since 9 April 2015. The index hit a high of 8,844.80 in intraday trade, its highest level since 13 March 2015
The market breadth indicating the overall health of the market turned negative from positive in late trade. On BSE, 1,497 shares declined and 1,365 shares gained. A total of 93 shares were unchanged.
The BSE Mid-Cap index was off 56.66 points or 0.51% at 11,070.76. The BSE Small-Cap index was off 40.64 points or 0.34% at 11,901.39. The fall in both these indices was lower than the Sensex's decline in percentage terms.
The total turnover on BSE amounted to Rs 4367 crore, higher than turnover of Rs 3079.67 crore registered during the previous trading session.
IT stocks declined after lower-than-expected US retail sales in March. The United States is the biggest outsourcing market for Indian IT firms. Infosys (down 1.07%), Wipro (down 2.49%), Tech Mahindra (down 1.17%) and HCL Technologies (down 3.55%) declined.
IT major TCS lost 1.14%. TCS announces its Q4 March 2015 and year ended 31 March 2015 results tomorrow, 16 April 2015.
Index heavyweight and cigarette maker ITC rose 1.27% to Rs 354.40. The stock hit high of Rs 357.95 and low of Rs 351.10.
PSU bank stocks edged higher in volatile trade. State Bank of India (SBI) (up 1.44%), Punjab National Bank (up 0.66%), Bank of Baroda (up 0.8%), Canara Bank (up 0.55%), Bank of India (up 2.69%) and Union Bank of India (up 0.82%) gained.
Private bank stocks were mixed. IndusInd Bank (up 0.17%), Yes Bank (up 0.34%), ING Vysya Bank (up 0.09%) and Federal Bank (up 1.82%) rose. HDFC Bank declined 1.27%.
ICICI Bank slipped 0.8%. ICICI Bank yesterday, 14 April 2015, cut its home loan rate for both existing as well as new borrowers by 25 basis points (bps) to 9.9%, according to reports.
Axis Bank fell 2.87%. Axis Bank yesterday, 14 April 2015, cut its home loan rate by 20 basis points (bps) to 9.95%, according to reports.
Kotak Mahindra Bank shed 0.4%. Kotak Mahindra Bank announced after market hours on Monday, 13 April 2015, that it has reduced its base rate by 0.15% to 9.85% per annum with effect from 16 April 2015. All categories of loan (other than the exceptions permitted by the Reserve Bank of India) will be priced with reference to the revised base rate.
DCB Bank rose 3.47% after net profit rose 61.06% to Rs 62.94 crore on 24.54% growth in total income to Rs 425.11 crore in Q4 March 2015 over Q4 March 2014. The Q4 result was announced on Tuesday, 14 April 2015. The stock market was closed on that day on the occasion of Dr. Baba Saheb Ambedkar Jayanti.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 62.4375, compared with closing of 62.5225 during the previous trading session on Monday, 13 April 2015. The foreign exchange market was closed yesterday, 14 April 2015, on the occasion of Dr. Baba Saheb Ambedkar Jayanti.
Minister of State for Finance Jayant Sinha reportedly said today, 15 April 2015, that India needs to move towards full capital account convertibility to become a leading global economy.
Brent crude oil futures edged higher after the International Energy Agency (IEA) raised its demand growth estimate for 2015 by 90,000 barrels a day to 93.6 million barrels a day. Brent for May settlement which expires today, 15 April 2015, was up 92 cents at $59.35 a barrel. The contract had risen 50 cents or 0.86% to settle at $58.43 a barrel during previous trading session. Brent for June settlement was up 57 cents to $60.38 a barrel.
Global oil demand will grow by more than previously expected in 2015, driven mainly by colder temperatures and a steadily improving global economic backdrop, IEA, the West's energy watchdog, said today, 15 April 2015. In its monthly oil-market report, the IEA revised its demand growth estimate for 2015 up by 90,000 barrels a day to 93.6 million barrels a day--a gain of 1.1 million barrels a day on the year--due to additional demand to heat homes, offices and other buildings in most economies of the Organization for Economic Cooperation and Development. The Paris-based agency, which advises industrialized nations on oil policies, said the gain was a notable acceleration on last year's 700,000 barrels a day growth.
Closer home, data released by government today, 15 April 2015, showed that inflation based on the wholesale price index (WPI) stood at negative 2.33% in March 2015 compared with a reading of negative 2.06% in February 2015. Meanwhile, WPI inflation for January 2015 was revised downwards. WPI inflation for January 2015 showed a negative reading of 0.95% compared with a negative reading of 0.39% reported earlier.
Earlier, data released by the government after market on Monday, 13 April 2015, showed that the all-India general CPI inflation slowed down to three-month low of 5.2% in March 2015 from 5.4% in February 2015. Food items were major contributors to the CPI inflation decline in March 2015.
India and Germany have decided to utilize the momentum generated by India's participation in the Hannover Messe in Germany to foster stronger ties between business and industry in both the countries in order to support India's 'Make in India' initiative, according to a joint statement issued by India and Germany yesterday, 14 April 2015, after Prime Minister Narendra Modi held bilateral talks with German Chancellor Angela Merkel in Berlin. India and Germany have also decided to take steps whereby Germany will support development of urban planning and infrastructure in India, including the development of smart cities in India, setting up peer-to-peer network of municipalities for direct collaboration and assistance in the area of affordable housing.
Germany will also support modernization of the railway infrastructure in India, including setting up of semi high-speed and high-speed railways and training and skill development of personnel in the rail sector starting with signalling and telecommunications and a high-speed rail system. Germany will also support India's proposed objective of 175 Giga Watts (GW) of renewable energy by 2022 through technical and financial support for developing comprehensive solar rooftop and green energy corridor projects in India.
India and Germany also agreed to strengthen their efforts towards carrying on negotiations for an ambitious EU India Free Trade Agreement with a view to its early conclusion.
Modi on Monday, 13 April 2015, said India is trying to introduce an element of transparency and predictability in taxation system. In his speech at the inauguration of the Indo-German Business Summit in Hannover, Germany, Modi said that the government has fast tracked approvals in industry and infrastructure. This includes environmental clearances, extending the industrial licences, delicencing of defence items and simplification of cross-border trade. Meanwhile, Modi said in his remarks at the Community Reception in Berlin yesterday, 14 April 2015, that the time is right for India to emerge as a global manufacturing hub. The Prime Minister called for balanced growth in the Indian economy, with equal emphasis on agriculture, manufacturing and services.
In overseas markets, European stocks edged higher today, 15 April 2015, ahead of the latest policy announcement from the European Central Bank (ECB). Key benchmark indices in Germany, France and UK were up 0.31% to 0.63%.
The ECB is widely expected to keep its key rates unchanged after a monetary policy review today, 15 April 2015.
In Greece, the new government has been locked in negotiations with its international creditors since coming to power in late January, with progress slow. The country needs to strike a deal within the next few months to secure billions of euros in bailout aid to avoid defaulting on its debts and potentially exiting the euro.
French consumer prices rose in March compared with the previous month, as the country exited the regulated sales season, prices of fresh produce rose and fuel prices slightly rebounded, statistics agency Insee said today, 15 April 2015. France's consumer price index rose 0.7% in March from February, after rising 0.7% on the month in February, although it recorded a 0.1% decline compared with a year earlier.
German consumer prices rose on the month in March, supporting cautious optimism that the European Central Bank's stimulus measures are starting to have an effect. Consumer prices measured according to common European standards rose 0.5% on the month and 0.1% on the year, the Federal Statistics Office said today, 15 April 2015, confirming its first estimate published at the end of March.
Rising exports helped widen the eurozone's trade surplus in February, data released showed today, 15 April 2015. The European Union's statistics agency said today, 15 April 2015 that the 19 countries that use the euro had a surplus in their trade in goods with the rest of the world of EUR20.3 billion ($21.5 billion), up from EUR14.4 billion in February 2014. That widening gap was due to a 4% increase in exports, while imports were little changed.
Asian stocks were mixed. Key benchmark indices in China, Taiwan, Japan and Indonesia fell by 0.2% to 1.24%. Key benchmark indices in Hong Kong, Singapore and South Korea rose by 0.21% to 0.54%.
China's economy expanded at its slowest pace in six years in the first quarter, weighed down by a slumping property market, industrial overcapacity and sluggish overseas demand, data released today, 15 April 2015 showed. China's gross domestic product rose 7% from a year earlier in the first quarter, slowing from 7.3% recorded in the fourth quarter of 2014 and 7.4% for all of last year.
Value-added industrial output in China rose 5.6% in March from a year earlier, slowing from 6.8% growth in the combined January-February period, data from the National Bureau of Statistics showed today, 15 April 2015. Month-on-month, industrial output increased 0.25% in March from February, when output rose 0.45% from January.
Fixed-asset investment in the non-rural areas of China climbed 13.5% from a year earlier in the January-March period, compared with an increase of 13.9% for the first two months of the year.
Trading in US index futures indicated that the Dow could rise 27 points at the opening bell today, 15 April 2015. US stocks ended yesterday, 14 April 2015 mostly higher, helped by energy stocks and quarterly earnings reports that topped modest expectations following worries about a strong dollar.
In US economic data, sales at US retailers rose in March by the largest amount in a year, rebounding after three straight monthly declines. However, the rebound was weaker than expected. US producer prices rose a seasonally adjusted 0.2% in March after four straight monthly declines, the Labor Department said yesterday, 14 April 2015.
Meanwhile, the International Monetary Fund (IMF) said in its latest World Economic Outlook (WEO) that global growth prospects are uneven across major economies. In advanced economies, growth is projected to strengthen in 2015 relative to 2014, but in emerging market and developing economies it is expected to be weaker, the IMF said yesterday, 14 April 2015. Overall, global growth is forecast at 3.5% in 2015 and 3.8% in 2016. IMF said that risks to global growth are now more balanced relative to six months ago, but remain tilted to the downside. Macroeconomic risks have slightly decreased (e.g., recession and deflation in euro area), but financial and geopolitical risks have increased, the IMF said. On the upside, the decline in oil prices could provide a greater boost to global growth than anticipated.
IMF Economic Counselor and Director of Research Olivier Blanchard said that a number of complex forces are shaping the prospects around the world. Legacies of both the financial and the euro area crisesweak banks and high levels of public, corporate, and household debtare still weighing on spending and growth in some countries. Low growth in turn makes deleveraging a slow process. Global growth in 2015 will be driven by a rebound in advanced economiesforecast to increase from 1.8% last year to 2.4% this yearsupported by the decline in oil prices, the WEO notes. Growth forecasts for most emerging and developing economies (with the important exception of India) are slightly worse.
Meanwhile, the World Trade Organization (WTO) yesterday, 14 April 2015, said that growth in the volume of world merchandise trade will pick up only slightly over the next two years, rising from 2.8% in 2014 to 3.3% in 2015 and eventually to 4% in 2016. Numerous downside risks to the forecast exist including geopolitical tensions, divergent monetary policies, exchange rate fluctuations and slower growth in emerging economies, the WTO said in a press release. Trade growth averaged just 2.4% between 2012 and 2014, the slowest rate on record for a three year period when trade was expanding (i.e. excluding years like 1975 and 2009 when world trade actually declined). Asia should have the strongest export performance of any region this year with 5% growth, followed closely by North America with 4.5% growth, according to the WTO's projections.
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