Key benchmark indices extended intraday gains in mid-afternoon trade as the latest data showed that trade deficit narrowed sharply in September 2013 from August 2013, reducing concerns about the country's current account deficit. The barometer index, S&P BSE Sensex, hit its highest level in more than two weeks. The Sensex was up 151.44 points or 0.76%, up 308.09 points from the day's low and off 31.31 points from the day's high. The market breadth, indicating the overall health of the market, was positive.
Index heavyweight Reliance Industries (RIL) extended intraday gain. Sesa Sterlite fell after releasing production data for Q2 September 2013. Realty stocks extended Tuesday's gain triggered by the Reserve Bank of India's (RBI) surprise announcement on Monday evening to improve liquidity conditions in the banking system. Shares of realty major DLF surged after the company on Tuesday said its subsidiaries have divested 60% stake in Star Alubuild Private (Star Alubuild) at an enterprise value of Rs 79.80 crore.
Key benchmark indices edged lower amid initial volatility after Reserve Bank of India (RBI) Governor Raghuram Rajan in an interview to a newspaper retained hawkish monetary policy stance by saying that monetary policy should aim at bringing down inflation expectations. Key benchmark indices trimmed initial losses as two index heavyweights -- ITC and Reliance Industries (RIL) -- edged higher in choppy trade. Key benchmark indices reversed initial losses on reports that US President Barack Obama will today, 9 October 2013, nominate Federal Reserve Vice Chair Janet Yellen to be the next head of the US central bank. Key benchmark indices extended gains and hit fresh intraday high in early afternoon trade as latest data showed that trade deficit narrowed sharply in September 2013 from August 2013. The market regained strength soon after trimming intraday gains in afternoon trade. Key benchmark indices extended intraday gains in mid-afternoon trade.
In the foreign exchange market, the rupee trimmed losses against the dollar after data showed the September trade deficit narrowed sharply from August, reducing concerns about the country's current account deficit. The partially convertible rupee was hovering at 61.80, almost unchanged for the day compared with its close of 61.7925/8025 on Tuesday, 8 October 2013. The rupee had declined below 62 against the dollar earlier during the day.
The market sentiment got a boost from data showing that foreign funds remained net buyers of Indian stocks on Tuesday, 8 October 2013. Foreign institutional investors (FIIs) bought shares worth a net Rs 226.32 crore on Tuesday, 8 October 2013, as per provisional data from the stock exchanges.
At 14:20 IST, the S&P BSE Sensex was up 151.44 points or 0.76% to 20,135.05. The index jumped 182.75 points at the day's high of 20,166.36 in mid-afternoon trade, its highest level since 23 September 2013. The index lost 156.65 points at the day's low of 19,826.96 in early trade, its lowest level since 7 October 2013.
The CNX Nifty was up 43.80 points or 0.74% to 5,972.20. The index hit a high of 5,979.40 in intraday trade. The index hit a low of 5,877.10 in intraday trade, its lowest level since 7 October 2013.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,319 shares gained and 1,003 shares declined. A total of 161 shares were unchanged.
L&T (up 2.1%), Tata Power Company (up 1.55%) and Bhel (up 1.38%) edged higher from the Sensex pack.
Sun Pharmaceutical Industries gained 3.92% to Rs 637.40, with the stock extending intraday gain. The stock hit a record high of Rs 645 in intraday trade.
Index heavyweight Reliance Industries rose 1.96% to Rs 860.50. The stock hit high of Rs 861.40 and low of Rs 838 so far during the day.
Sesa Sterlite fell after releasing production data for Q2 September 2013. The stock was off 1.13%.
Infosys gained 1.78%. Infosys announces its Q2 results on Friday, 11 October 2013. At the time of announcing Q1 June 2013 results in July this year, Infosys had retained its guidance of 6% to 10% growth in revenue in dollar terms for the year ending 31 March 2014 (FY 2014). At that time, the company had raised the guidance in rupee terms due to a steep depreciation of the rupee against the dollar. The company had forecast 13% to 17% growth in revenue in rupee terms for FY 2014, higher than its earlier guidance of 6% to 10% growth which the company had given at the time of announcement of Q4 March 2013 results. The rupee revenue guidance was based on assumption of dollar rupee conversion rate of Rs 59.39 for the rest of the fiscal year.
Realty stocks extended Tuesday's gain triggered by the Reserve Bank of India's (RBI) surprise announcement on Monday evening to improve liquidity conditions in the banking system. Purchases of both residential and commercial property are largely driven by finance. HDIL (up 5.69%), Unitech (up 3.58%), Oberoi Realty (up 0.81%) and Indiabulls Real Estate (up 7.63%) gained.
DLF surged 6.51%. The company after market hours on Tuesday, 8 October 2013 said its two subsidiaries viz. DLF Home Developers and DLF Projects have divested 60% stake in Star Alubuild (Star Alubuild), a subsidiary, at an enterprise value of Rs 79.80 crore. Star Alubuild specializes in designing, engineering, fabrication and installation of curtain walls for commercial buildings, retail malls and doors & windows for projects throughout India. Accordingly, Star Alubuild has ceased to be subsidiary of the company, DLF said. The transaction is a part of DLF's objective of divesting its non core assets.
Prestige Estates Projects rose 3.66% after the company said its real estate sales rose 31% to Rs 1068.50 crore in Q2 September 2013 over Q2 September 2012. The announcement was made during trading hours today, 9 October 2013.
Prestige Estates Projects said it demonstrated strong operating performance in Q2 September 2013 despite all the negative factors affecting the economy, such as rising inflation, falling rupee, lowest GDP growth, surprise increase in the interest rates and volatility in the markets.
The company said it is committed to accelerate its sales and launches over the coming quarters and coupled with the numbers achieved so far this fiscal, we are well on track to achieve targets set for the year ending March 2014.
Future Retail (up 8.1%), HDIL (up 5.94%), Suzlon Energy (up 5.16%), Wockhardt (up 4.26%) and Torrent Power (up 4.89%) were among the top gainers from the BSE's 'A' group.
The provisional data released by the government today, 9 September 2013, showed that India's trade deficit narrowed sharply to $6.7 billion in September 2013 from $10.9 billion in August 2013. The September trade deficit is the lowest since March 2011. Merchandise exports rose by 11.15% year-on-year in September to $27.68 billion. Imports fell 18.1% year-on-year to $34.44 billion.
Imports of gold in September fell 82% from a year earlier to $800 million while crude-oil imports dropped 5.94% to $13.20 billion. "Steps taken by the government to curb imports of nonessential items, especially precious metals, have resulted in the significant fall in imports," Trade Secretary S.R. Rao, said. In recent months, the government has increased the import tax on gold to check demand for the metal. The central bank has also tightened rules to reduce speculative purchases by bullion dealers and taken other steps to curb demand.
The International Monetary Fund (IMF) forecast economic growth for India to dip to 4.25% in the year to 31 March 2014 in its World Economic Outlook released on Tuesday, saying the economy would continue to underperform because of regulatory, infrastructural, and financing issues. The multilateral agency expects the country's growth to improve somewhat to 5% in the next fiscal year if exports strengthen and supply bottlenecks ease.
European shares fell on Wednesday, 9 October 2013, as debt talks in Washington remained deadlocked. Key benchmark indices in France, Germany and UK shed by 0.06% to 0.35%.
Asian markets edged higher in choppy trade on Wednesday, 9 October 2013, on reports that US President Barack Obama will today, 9 October 2013, nominate Federal Reserve Vice Chair Janet Yellen to be the next head of the US central bank. Key benchmark indices in China, Indonesia, Singapore and Japan rose by 0.31% to 1.03%. Key benchmark indices in Taiwan and Hong Kong fell by 0.37% to 0.63%. South Korea's markets were closed today for a holiday.
Trading in US index futures indicated that the Dow could rise 49 points at the opening bell on Wednesday, 9 October 2013. US stocks fell on Tuesday hit by growing jitters over the budget impasse in Washington, with the partial government shutdown extending into a second week with few signs of a deal to end it or raise the nation's debt ceiling.
US President Barack Obama on Tuesday warned of economic chaos if the US fails to pay its bills.
As per media reports, Obama will nominate Federal Reserve Vice Chair Janet Yellen to be the next head of the US central bank on Wednesday, 9 October 2013, putting her on course to be the first woman to lead the institution in its 100-year history. Seen as a monetary policy dove, Yellen is considered more likely to maintain the Fed's current stance. On 18 September 2013, the Fed surprised economists and investors with its decision to delay scaling back its stimulus amid concerns about the strength of the economic recovery.
The Federal Open Market Committee (FOMC) holds a two-day policy meeting on 29-30 October 2013. The lack of data may make it harder for the Federal Reserve to assess the economy's strength. Government data from payrolls to retail sales will be delayed as long as the shutdown continues.
The International Monetary Fund on Tuesday cut its global growth forecast to 2.9% for 2013 from its July estimate of 3.1%. IMF sees a modest pickup next year to 3.6%.
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