Gains in world stocks aided rally on the domestic bourses as the barometer index, the S&P BSE Sensex, pierced the psychological 27,000 mark. Benchmark indices extended gains in late trade. The Sensex and 50-unit CNX Nifty, both, hit their fresh highest level in more than five weeks. The Sensex was provisionally up 215.46 points or 0.8% at 27,096.28. The market breadth indicating the overall health of the market was positive. Stocks rose across the globe on speculation the US Federal Reserve will signal at the end of a monetary policy review today, 29 October 2014, that US interest rates will stay low.
Auto stocks rose on buzz of strong sales during the Diwali festive season, with Maruti Suzuki India and Bajaj Auto hitting record high. IT stocks were in demand. Grasim Industries edged higher in volatile trade after announcing Q2 results. Realty stocks rose on reports the Union Cabinet is likely to consider today, 29 October 2014, a proposal to liberalise foreign direct investment in construction sector. Sesa Sterlite rose after announcing Q2 results.
The Sensex and Nifty gained for the second day in a row today, 29 October 2014.
In overseas markets, Europeans stocks rose as investors weighed company earnings and awaited the Federal Reserve's monetary-policy decision. Asian stocks rose after US stocks surged overnight on optimism about earnings and economic data in the US. US stocks surged yesterday, 28 October 2014, with Standard & Poor's 500 Index settling near a record on speculation the US central bank will retain the language on the policy statement broadly dovish to signal a prolonged period of low rates, if the economy proves dicey. A two-day meeting of the Federal Open Market Committee (FOMC) on US monetary policy concludes later in the global day today, 29 October 2014.
In the foreign exchange market, the rupee edged lower against the dollar on month-end dollar demand from importers.
Brent crude oil prices edged higher as investors awaited guidance from the Federal Reserve on US monetary policy later in the day and after industry data on US inventories came in more or less as expected.
Indian stocks may remain volatile tomorrow, 30 October 2014, 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 contracts expire tomorrow, 30 October 2014.
As per provisional figures, the S&P BSE Sensex was up 215.46 points or 0.8% at 27,096.28. The index jumped 245.48 points at the day's high of 27,126.30 in late trade, its highest level since 23 September 2014. The index rose 90.34 points at the day's low of 26,971.16 in morning trade.
The CNX Nifty was up 68.50 points or 0.85% at 8,096.10, as per provisional figures. The index hit a high of 8,097.95 in intraday trade, its highest level since 23 September 2014. The index hit a low of 8,052.25 in intraday trade.
The BSE Mid-Cap index was up 49.89 points or 0.52% at 9,650.29. The BSE Small-Cap index was up 66.40 points or 0.62% at 10,790.46. Both these indices underperformed the Sensex.
The total turnover on BSE amounted to Rs 2856 crore, higher than turnover of Rs 2763.91 crore on Tuesday, 28 October 2014.
The market breadth indicating the overall health of the market was positive. On BSE, 1,591 shares rose while 1,370 shares declined. A total of 113 shares were unchanged.
Sesa Sterlite rose 2.02% to Rs 255.30. The stock was volatile. The stock hit high of Rs 256.80 and low of Rs 247.55. The company's consolidated net profit before exceptional items rose 15% to Rs 1658 crore on 8% rise in net sales/income from operations to Rs 19448 crore in Q2 September 2014 over Q2 September 2013. The Sesa Sterlite merger and the Vedanta Group consolidation was completed in August 2013, hence Q2 and H1 FY 2015 performance is compared with the adjusted proforma numbers of respective period, which are more representative of the performance during the period, Sesa Sterlite said in a press release. The result was announced at the fag end of session. The company has strong balance sheet with cash & cash equivalents of over Rs 47000 crore as at 30 September 2014.
Realty stocks rose on reports the Union Cabinet is likely to consider today, 29 October 2014, a proposal to liberalise foreign direct investment (FDI) in construction sector. Among realty stocks, D B Realty (up 4.41%), DLF (up 6.02%), Housing Development & Infrastructure (HDIL) (up 1.66%), Sobha (up 6.52%) and Unitech (up 2.9%) gained.
As per reports, the Department of Industrial Policy and Promotion (DIPP) has proposed substantial easing of norms for affordable housing and the 100 smart cities envisaged by the new government that took charge in May. Under current rules, 100% FDI is allowed through the automatic route in development of townships, housing and built-up infrastructure, subject to stringent conditions and a three-year lock-in. DIPP, the nodal agency for FDI, has reportedly proposed relaxation in norms related to built-up area, capitalisation and lock-in period. It has proposed that the minimum built-up area be cut to 20,000 sq metres from 50,000 sq metres and the minimum capitalisation be halved to $5 million from $10 million and from $5 million to $2.5 million for joint ventures with Indian partners, reports suggest. Minimum built-up area in case of serviced housing plots is proposed to be cut to 5 hectares from 10 hectares and the minimum lock-in period of three years after the completion of the project is proposed to be dropped, according to reports.
IT stocks were in demand. Infosys (up 2.59%), HCL Technologies (up 1.13%) and Wipro (up 0.61%) gained.
TCS rose 0.96%. The stock turned ex-dividend today, 29 October 2014, for an interim dividend of Rs 5 per share for the year ending March 2015.
Tech Mahindra gained 1.22% ahead of its Q2 results today, 29 October 2014.
Bajaj Auto rose 2.09% to Rs 2555 after hitting record high of Rs 2,559 in intraday trade.
Maruti Suzuki India gained 1.63% to Rs 3202 after hitting record high of Rs 3,217.60 in intraday trade.
Dr Reddy's Laboratories (DRL) lost 0.9% to Rs 3,053.05 after consolidated net profit fell 17% to Rs 574.10 crore on 7% growth in revenue to Rs 3587.90 crore in Q2 September 2014 over Q2 September 2013. The stock was volatile. The stock hit high of Rs 3,117.30 and low of Rs 2996. The Q2 result was announced during market hours today, 29 October 2014.
At the time of announcement of the second quarter results, DRL said that the company recently entered into an asset purchase agreement with Novartis Consumer Health Inc. to acquire the title and rights to Habltrol franchise (an over the counter nicotine replacement therapy transdermal path) and to market the product in the US territory.
Grasim Industries rose after announcing Q2 results. The stock rose 1.73% to Rs 3438.25. The stock was volatile. The stock hit high of Rs 3449.95 and low of Rs 3335. The company's consolidated net profit fell 7.55% to Rs 416 crore on 16% rise in revenue to Rs 7945 crore in Q2 September 2014 over Q2 September 2013. The merger of Gujarat cement units of Jaypee Cement Corporation (JCCL) with UltraTech Cement (UltraTech), a subsidiary of Grasim, became effective from 12 June 2014 and the financial results of the acquired units have been included with the UltraTech's financial results with effect from 12 June 2014. As a result, figures for the quarter and six months ended 30 September 2014 are strictly not comparable with previous periods, Grasim said.
With regard to future business outlook of the VSF business, Grasim said that profit margins in the VSF sector are likely to remain under pressure in the near term due to the overcapacity in China. Sharply declining cotton and polyester prices is a major challenge and may impact the growth of VSF consumption, Grasim said. The slowdown in new capacity additions in China should lead to an improvement in industry utilization which augurs well for the company, Grasim said.
With additional capacity coming on stream in both cement and VSF businesses, the company will further consolidate its leadership position and is well-poised to benefit from the expected upturn in the economy, Grasim said.
In the foreign exchange market, the rupee edged lower against the dollar on month-end dollar demand from importers. The partially convertible rupee was hovering at 61.35, compared with its close of 61.33 during the previous trading session.
Brent crude oil prices edged higher as investors awaited guidance from the Federal Reserve on US monetary policy later in the day and after industry data on US inventories came in more or less as expected. Brent crude for December delivery was up 47 cents at $86.50 a barrel. The contract had gained 20 cents to settle at $86.03 a barrel during the previous trading session.
Meanwhile, according to a latest survey by Nielsen, India remained the most bullish consumer market, while Italy became the most pessimistic, according to reports. The Nielsen Global Consumer Confidence Index rose 1 point in the third quarter to 98, according to the survey conducted between 13 August and 5 September 2014. The index has been steadily rising since the first quarter of 2012 and the latest reading headed closer to the 100 mark that signals optimism among consumers.
European stocks climbed today, 29 October 2014, before the Federal Reserve reviews monetary policy later in the global day. Key benchmark indices in France, Germany and UK rose 0.19% to 0.55%.
French consumer confidence stagnated at a low level in October, statistics agency Insee said today, 29 October 2014. Consumer confidence in the eurozone's second-largest economy stood at 85 in October, unchanged from September and well below the long-term average of 100, Insee said. Consumers' assessments of their financial strength and their ability to make savings were little changed from September. French households became less optimistic about living standards, but concerns over rising unemployment declined, Insee said.
Asian stocks rose today, 29 October 2014, after US stocks surged overnight on optimism about earnings and economic data in the US. Key benchmark indices in Indonesia, South Korea, Singapore, Japan, China, Hong Kong and Taiwan were up 0.39% to 1.84%.
The latest data showed a sharp rebound in Japanese industrial output last month. Industrial production in Japan rose 2.7% in September from the previous month, the latest data showed. Industrial output had contracted 1.9% in August.
China's focus on meeting short-term growth targets could hamper reform efforts it needs for sustain longer-term economic expansion, the World Bank said today, 29 October 2014, in its China Economic Update. The World Bank praised Beijing for tightening credit growth, reducing excess capacity and grappling with pollution, adding these necessary steps toward economic rebalancing had also contributed to slower growth this year. China's gross domestic product grew a year-on-year 7.4% over the January-September period.
Trading in US index futures indicated that the Dow could rise 18 points at the opening bell today, 29 October 2014. US stocks surged yesterday, 28 October 2014, with Standard & Poor's 500 Index settling near a record on speculation the US central bank will retain the language on the policy statement broadly dovish to signal a prolonged period of low rates, if the economy proves dicey. A two-day meeting of the Federal Open Market Committee (FOMC) on US monetary policy concludes later in the global day today, 29 October 2014.
Among economic data, US consumer confidence hit its highest since 2007 in October. The report overshadowed a separate read that showed new orders for capital goods fell the most in eight months in September.
A two-day meeting of the Federal Open Market Committee (FOMC) on US monetary policy review concludes today, 29 October 2014. The Fed is expected to announce the end of quantitative easing after the meeting. Investors will be looking to see if the Fed drops the "considerable period" for keeping rates low at the latest policy meeting. As several Fed officials have come out with dovish comments recently, investors largely expect that guidance to be reiterated.
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