Key benchmark indices edged higher on the first trading session of the week, with market sentiment boosted by provisional data showing that foreign funds made substantial purchases of Indian stocks on Friday, 11 October 2013. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, settled at 3-1/2-week high. The Sensex garnered 78.95 points or 0.38%, up 109.66 points from the day's low and off 38.40 points from the day's high. The market breadth, indicating the overall health of the market, was positive. Index heavyweight Reliance Industries (RIL) rose ahead of its Q2 results.
Indian stocks rose for the fifth trading session in a row today, 14 October 2013. From a recent low of 19,895.10 on 7 October 2013, the Sensex has gained 712.44 points or 3.58% in five trading sessions. The Sensex has gained 1,227.77 points or 6.34% in this month so far (till 14 October 2013). The Sensex has gained 1,180.83 points or 6.08% in calendar 2013 so far (till 14 October 2013). From a 52-week high of 20,739.69 on 19 September 2013, the Sensex has declined 132.15 points or 0.64%. From a 52-week low of 17,448.71 on 28 August 2013, the Sensex has risen 3,158.83 points or 18.1%.
Coming back to today's trade, Infosys extended Friday's gains triggered by the company raising its revenue guidance for the full year at the time of announcement of Q2 September 2013 results before trading hours on Friday, 11 October 2013. Many other IT stocks extended Friday's gains triggered by IT major Infosys' upward revision in its revenue guidance for the full year. TCS scaled record high ahead of its Q2 result tomorrow, 15 October 2013. Wipro scaled 52-week high. Tech Mahindra hit 52-week high after the Reserve Bank of India enhanced the limit for foreign institutional investors to purchase shares in the company to 45% of the paid up capital of the company.
Metal stocks edged lower as China's exports unexpectedly fell in September and inflation jumped on food prices, signaling constraints on the nation's economic recovery. Capital goods pivotals edged lower.
Many banking stocks extended Friday's gains triggered by the Reserve Bank of India's (RBI) decision on Thursday, 10 October 2013, to allow banks to raise funds from global multilateral institutions until 30 November 2013 as long as the money raised is for general banking purposes and not for capital enhancement. IndusInd Bank dropped in volatile trade as the private sector bank's gross non-performing assets rose in Q2 September 2013. HDFC Bank gained ahead of Q2 result tomorrow, 15 October 2013. Shares of a number of small and mid-sized private sector banks rallied on media reports quoting RBI Governor Raghuram Rajan saying the central bank will unveil over the next few weeks reforms in the banking sector that would allow foreign lenders to take over smaller domestic ones.
Shares of auto components maker Motherson Sumi Systems scaled record high. Realty stocks edged lower. Tata Motors hit record high. Shares of two-wheeler makers gained.
The market sentiment was boosted by data showing that foreign funds remained net buyers of Indian stocks on Friday, 11 October 2013. Foreign institutional investors (FIIs) bought shares worth a net Rs 1010.45 crore on Friday, 11 October 2013, as per provisional data from the stock exchanges.
The S&P BSE Sensex garnered 78.95 points or 0.38% to settle at 20,607.54, its highest closing level since 19 September 2013. The index jumped 117.35 points at the day's high of 20,645.94 in morning trade. The index fell 30.71 points at the day's low of 20,497.88 in early trade.
The CNX Nifty advanced 16.50 points or 0.27% to 6,112.70, its highest closing level since 19 September 2013. The index hit a high of 6,124.10 in intraday trade. The index hit a low of 6,082.90 in intraday trade.
The total turnover on BSE amounted to Rs 1667 crore, lower than Rs 2133.68 crore on Friday, 11 October 2013.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,291 shares gained and 1,130 shares fell. A total of 154 shares were unchanged.
The BSE Mid-Cap index rose 0.62% and the BSE Small-Cap index gained 0.51%. Both these indices outperformed the Sensex.
The BSE IT index (up 2.32%), the BSE Teck index (up 1.82%), the BSE Bankex (up 0.55%), the BSE Auto index (up 0.45%) outperformed the Sensex.
The BSE Oil & Gas index (up 0.35%), the BSE PSU index (up 0.1%), the BSE Power index (up 0.03%), the BSE Consumer Durables index (down 0.19%), the BSE Realty index (down 0.35%), the BSE HealthCare index (down 0.36%), the BSE Capital Goods index (down 0.42%), the BSE FMCG index (down 0.57%) and the BSE Metal index (down 0.64%) underperformed the Sensex.
Index heavyweight and cigarette maker ITC declined 0.67% to Rs 339.70. The scrip high of Rs 342.95 and low of Rs 339.
Metal stocks edged lower as China's exports unexpectedly fell in September and inflation jumped on food prices, signaling constraints on the nation's economic recovery. China is the world's largest consumer of copper and aluminum. Tata Steel (down 1.88%), Sail (down 0.69%), JSW Steel (down 0.32%), Hindalco Industries (down 3.24%), and Jindal Steel & Power (down 0.79%), edged lower. Sesa Sterlite was flat.
Index heavyweight Reliance Industries rose 0.96% ahead of its Q2 results today, 14 October 2013.
ONGC rose 0.11%. The company during market hours today, 14 October 2013, said that its wholly owned subsidiary ONGC Videsh (OVL), through its affiliates has signed definitive agreements to acquire 12% participating interest (PI) in Block BC-10, Campos Basin, Deep Offshore Brazil for $529.03 million as part of the sale of 35% share made by Petrobras. ONGC Videsh had earlier acquired 15 % PI in the block in 2006. The other partners in the block were Shell, Operator with 50% PI and Petrobras with 35% PI. In August 2013, Petrobras entered into a sales transaction with Sinochem for disposal of its 35% PI in BC-10 for $1.543 billion. This agreement was subject to pre-emption rights of the partners Shell and ONGC Videsh. A pre-emption notice was served on 17 September 2013 by Shell and ONGC Videsh to jointly acquire 35%, in which 12% PI corresponds to ONGC Videsh. Upon closing of the transaction, PI of OVL would increase to 27% in the block. The acquisition of additional PI in the block is subject to approval of the Brazilian antitrust and regulatory authorities.
ONGC said that the Block BC-10 also known as Parque das Conchas is in Campos Basin of Brazil and includes 4 offshore deep-water fields -- Ostra, Abalone, Argonauta and Nautilus and a few identified exploration prospects. The block is in the deep-waters of Brazil in the water depths ranging from 1,500 to 1,950 meters and 120 km from Vitoria town on the shore. The license for the fields expires in December 2032.
In a separate development, ONGC Videsh has been awarded two onshore blocks namely B2 (Zebyutaung-Nandaw) and EP-3 (Thegon-Shwegu) in the Myanmar Onshore Bidding Round 2013. This was announced by the Ministry of Energy, republic of the Union of Myanmar. Block B-2, having an area of 16,995 sq. kms. is located in Northern Myanmar, bordering state of Manipur in India and Block EP-3 having an area of 1,650 sq. kms. is located in Central Myanmar.
Earlier, the Government of Myanmar had announced Onshore 2nd Bid Round-2013 for 18 blocks on 17 January, 2013. ONGC Videsh was one of the 7 Indian companies which were shortlisted as Pre-qualified bidders.
Indian Oil Corporation fell 1.82%. The company after market hours today, 14 October 2013, said that that subsequent to the invitation of financial bid for disinvestment of 39.99% equity shares of Haldia Petrochemicals (HPL) held by West Bengal Industrial Development Corporation (WBIDC) and 100% preference shares of Haldia Petrochemicals held by WBIDC, West Bengal Industrial Infrastructure Development Corporation (WBIIDC) and West Bengal Industrial Development Finance Corporation (WBIDFC) being disinvested by the state government of West Bengal (GoWB), Indian Oil Corporation has been announced by the GoWB, as the selected bidder, in line with the process laid in the Request for Proposal.
The acquisition of the stake is subject to certain existing shareholders' exercise of right of first refusal on the entire sale shares, as per the existing Articles of Association of HPL and proceedings pending before courts; and exercise of tag along rights by certain existing shareholder. The consummation of the transaction, also, remains subject to execution of definitive agreements and obtaining of applicable regulatory approvals and certain third party consents, Indian Oil Corporation said.
Infosys extended Friday's gains triggered by the company raising its revenue guidance for the full year at the time of announcement of Q2 September 2013 results before trading hours on Friday, 11 October 2013. The stock was up 1.07% at Rs 3,309. The scrip had hit 52-week high of Rs 3,360 in intraday trade on Friday.
Many other IT stocks extended Friday's gains triggered by IT major Infosys' upward revision in its revenue guidance for the full year. Wipro rose 2.44% to Rs 500.20, with the stock extending intraday gain. The stock hit 52-week high of Rs 507.70 in intraday trade.
IT major TCS jumped 4.56% to Rs 2,220.90, ahead of its Q2 result tomorrow, 15 October 2013. The stock hit record high of Rs 2,224 in intraday trade.
Tech Mahindra rose 0.57% to Rs 1,557.45 after the central bank enhanced the limit for foreign institutional investors to purchase shares in the company to 45% of the paid up capital of the company. The stock hit 52-week high of Rs 1,585.40 in intraday trade. The Reserve Bank of India (RBI) enhanced the limit for foreign institutional investors (FIIs) to invest to up to 45% of the paid-up capital of Tech Mahindra. This limit has been revised from the earlier limit of 35% of the paid-up capital of the company under the Portfolio Investment Scheme (PIS). FIIs, at the end of September 2013, controlled 32.59% stake in the company, while promoters holding stood at 36.46%.
HCL Technologies gained 0.44%.
Many banking stocks extended Friday's gains triggered by the Reserve Bank of India's (RBI) decision on Thursday, 10 October 2013, to allow banks to raise funds from global multilateral institutions until 30 November 2013 as long as the money raised is for general banking purposes and not for capital enhancement. These borrowings from multilateral bodies will also be eligible for the recently opened forex swap facility. The central bank also allowed banks to borrow from entities other than their own branches overseas under existing regulators for borrowing overseas.
Among private bank stocks, Axis Bank (up 0.96%), Yes Bank (up 0.09%), and ICICI Bank (up 0.26%), gained.
HDFC Bank rose 1.37%. The bank announces its Q2 result tomorrow, 15 October 2013.
IndusInd Bank dropped in volatile trade as the private sector bank's gross non-performing assets rose in Q2 September 2013. The stock was down 0.75% at Rs 424.75. The scrip was volatile. The stock hit high of Rs 439.95 and low of Rs 422. The bank's net profit jumped 31.96% to Rs 330.23 crore on 18.88% growth in total income to Rs 2435.30 crore in Q2 September 2013 over Q2 September 2012. The bank announced Q2 result during market hours.
IndusInd Bank's provisions and contingencies jumped 81.08% to Rs 88.86 crore in Q2 September 2013 over Q2 September 2012. Provisions and contingencies declined sharply on sequential basis. Provisions and contingencies dropped 32.71% in Q2 September 2013 over Q1 June 2013.
IndusInd Bank's ratio of net non-performing assets to net advances stood at 0.22% as on 30 September 2013, compared with 0.21% as on 30 June 2013 and 0.29% as on 30 September 2012.
The bank's gross non-performing assets stood at Rs 546.39 crore as on 30 September 2013, higher than Rs 505.23 crore on 30 June 2013 and Rs 409.52 crore on 30 September 2012. The ratio of gross non-performing assets (NPA) to gross advances stood at 1.11% as on 30 September 2013, compared with 1.06% as on 30 June 2013 and 1.03% as on 30 September 2012.
IndusInd Bank said that in terms of the Reserve Bank of India (RBI) circular dated 23 August 2013 on classification, valuation and provisioning of investment portfolio of banks, IndusInd Bank has opted to amortize the depreciation on the Available for Sale (AFS) and Held for Trading (HFT) portfolios on each of the valuation dates in the current financial year in equal installments during the financial year 2013-14. As a result, of the total depreciation of Rs 114.58 crore as on 30 September 2013, the bank has recognized Rs 16.37 crore in the profit and loss account in Q2 September 2013. IndusInd Bank said that in accordance with its accounting policy consistently adopted which is more conservative compared with RBI guidelines, the bank continues to ignore appreciation on its AFS and HFT portfolio. The gross appreciation in the AFS and HFT portfolio amounted to Rs 43.37 crore as on 30 September 2013.
Among PSU bank stocks, Union Bank of India (up 2.18%), Bank of India (up 0.22%), Bank of Baroda (up 1.73%) and Punjab National Bank (up 0.27%) gained.
State Bank of India shed 0.1% to Rs 1,650. Canara Bank was down marginally by 0.02%.
Shares of a number of small and mid-sized private sector banks rallied on media reports quoting RBI Governor Raghuram Rajan saying the central bank will unveil over the next few weeks reforms in the banking sector that would allow foreign lenders to take over smaller domestic ones. Lakshmi Vilas Bank (up 19.95%), Karnataka Bank (up 16.11%), Dhanalakshmi Bank (up 10.46%), South Indian Bank (up 9.85%), Karur Vysya Bank (up 6.87%), Federal Bank (up 6.42%), City Union Bank (up 6.13%) and Development Credit Bank (up 5.91%) surged.
Auto stocks were mostly lower. M&M fell 0.6%. Maruti Suzuki India fell 1.64%.
Ashok Leyland fell 0.29% to Rs 16.90. A block deal of 87.85 lakh shares was executed in the counter on BSE at Rs 17.20 per share at 9.42 IST.
Tata Motors gained 1.62% to Rs 391.40, with the stock extending recent rally. The stock hit record high of Rs 393 in intraday trade. Tata Motors' British luxury car unit Jaguar Land Rover (JLR) last week said its retail sales jumped 17% to 43,181 vehicles in September 2013 over September 2012. Sustained sales growth continues for JLR, with increase in retail sales in all major regions, JLR said in statement. Retail sales of the Land Rover brand rose 13% to 34,719 vehicles in September 2013 over September 2012. Sales of the Jaguar brand jumped 35% to 8,462 vehicles in September 2013 over September 2012.
Shares of two-wheeler makers gained. Bajaj Auto rose 0.06%. Hero MotoCorp gained 1.3%.
Bosch fell 0.69% to Rs 8,640. The company after trading hours on Friday, 11 October 2013, said that the management has decided to suspend production for a few days at the company's manufacturing units at Jaipur and Bangalore so as to avoid unnecessary buildup of inventory. Production at the Jaipur plant was suspended on 12 October 2013 and will be suspended again on 19 October 2013 and again from 28th October till 2nd November 2013. Production at Bangalore plant will be suspended on 15th and 31st of October 2013.
Motherson Sumi Systems jumped 4.45% to Rs 259.50. The stock hit record high of Rs 265.95 in intraday trade.
Capital goods pivotals edged lower. L&T (down 0.78%) and Bhel (down 1.7%), declined.
Suzlon Energy rose 6.89% after the company said it won a new contract in Uruguay. The company made the announcement during trading hours today, 14 October 2013. Financial details of the deal were not disclosed.
Suzlon Energy announced that the group won a 65 megawatt (MW) project in Uruguay. The project, located in the southern Department of Colonia in Uruguay, is developed by Rouar S.A., a unique joint venture between UTE - Uruguay's state-owned utility, and Brazilian utility Eletrobras - the largest in Latin America, the company said in a statement.
As per the deal, Suzlon will supply 31 units of the S95 - 2.1 MW wind turbines for the project. Suzlon will be responsible for full EPC delivery for the project, scheduled for completion in September 2014, the company said.
Speaking on the order, Mr Tulsi Tanti, Chairman - Suzlon Group, said:"This is a major order for the company and a big step forward in our push into South America. We are very pleased to deliver our first project in Uruguay, and to partner with both UTE and Eletrobras through Rouar S.A., and look forward to a long and constructive relationship."
Idea Cellular rose 0.54% to Rs 184.95 after hitting a record high of Rs 186.70 in intraday trade. Idea Cellular said during market hours today, 14 October 2013, that the company has signed Unified License with the Department of Telecommunications in respect of its seven service areas namely Tamil Nadu, Orissa, West Bengal, Kolkata, Assam, North East and Jammu & Kashmir. The company's seven operative telecom licenses in respect of these seven service areas were quashed by the Supreme Court vide its judgment dated 2 February 2012. The company thereafter bid and won the spectrum in respect of these seven service areas in the auction held in November 2012.
Realty stocks edged lower on profit booking after recent gains. HDIL (down 0.47%), Unitech (down 1.03%), D B Realty (down 2.44%) and DLF (down 0.36%), edged lower.
Wockhardt was locked at a lower circuit limit of 5% at Rs 499.30 on BSE after the UK drug regulator withdrew its quality certification to the company's Chikalthana factory in Maharashtra. The company made the announcement on Saturday, 12 October 2013. Wockhardt informed that UK's health regulator -- the Medicines and Healthcare Products Regulatory Agency (MHRA) -- has withdrawn the good manufacturing certification of the company's Chikalthana facility at Aurangabad in Maharashtra. The company can, however, continue exporting some critical drugs to the UK as the MHRA will issue a restricted good manufacturing practice (GMP) certificate to the plant to avoid a shortage of medically essential products supplied by Wockhardt.
Wockhardt said that the impact on the existing business will be known once the company receives further communication from the MHRA.
The Chikalthana facility contributes approximately 12 million pounds from the UK and the European Union (EU) markets to the consolidated annual revenues of the company, Wockhardt said.
Dishman Pharmaceuticals and Chemicals fell 4.63% after the company said the income tax department surveyed the company's premises for taxation issues. The announcement was made on Saturday, 12 October 2013. Dishman Pharmaceuticals and Chemicals (Dishman Pharma) announced that a survey was carried out by the income tax department (IT dept) in the factory and office premises of the company, which was concluded on 11 October 2013. The department sought various information and explanations and the company provided the same.
The company said that it does not expect any material additional tax liability to emanate out of the survey findings.
Pratibha Industries jumped 9.39% after the company secured two contracts aggregating to Rs 516.17 crore from PHED (Ajmer and Bharatpur), Rajasthan.
Bond prices dropped after the latest data showed that inflation based on the wholesale price inflation (WPI) accelerated to a seven-month high in September 2013, increasing the chance that the central bank may raise its main lending rate viz. the repo rate at a monetary policy review later this month. The yield on the benchmark federal paper 7.16% GS 2023 was hovering at 8.5747%, higher than its close of 8.489% on Friday, 11 October 2013. Bond yield and bond prices are inversely related.
WPI inflation accelerated to 6.46% in September 2013, from 6.1% in August 2013. Increase in inflation in September 2013 was mainly driven by surge in inflation for crude oil and non-food primary articles viz. fibres and oilseeds. Core inflation accelerated to 2.06% in September 2013 from 1.97% in August 2013. Inflation for July 13 was revised upwards to 5.85% from 5.79% reported earlier.
Build up of inflation rate in the financial year so far was 5.64% compared to 4.84% in the corresponding period of the previous year.
Data on inflation based on the consumer price index (CPI) for September 2013, is due after trading hours today, 14 October 2013. The annual rate of inflation based on the combined consumer price index (CPI) for urban and rural India is seen easing a bit 9.4% in September 2013 from 9.52% in August 2013, as per the median estimate of a poll of economists carried out by Capital Market. The CPI had decelerated to 9.52% in August 2013 from 9.64% in July 2013. Inflation for the category 'food and beverages' stood at 11.06% in August 2013.
In the foreign exchange market, the rupee edged lower against the dollar as increase in WPI inflation to a 7-month high in September 2013 raised the possibility of the central bank raising its main lending rate viz. the repo rate at a monetary policy review later this month. The partially convertible rupee was hovering at 61.55, weaker than its close of 61.07/08 on Friday, 11 October 2013.
Industrial production growth slowed to 0.6% in August 2013 from an upwardly revised 2.8% pace in July, hurt by weak investment and consumer demand, government data showed on Friday, 11 October 2013. The entire growth in industrial production in August 2013 was mainly driven by 7.2% surge in electricity generation. The mining output continued to witness decline in output, while the manufacturing sector output also recorded fall in August 2013.
European stock markets edged lower on Monday, 14 October 2013, with investors worried about the debt impasse in the United States. Key benchmark indices in Germany and France were off 0.12% to 0.15%. In UK, the FTSE 100 index was up 0.13%
Asian stocks dropped on Monday, 14 October 2014, weighed by an unexpected drop in exports from China and as American lawmakers struggled over an accord to raise the nation's debt limit and restore government operations. Key benchmark indices in Singapore, South Korea and Taiwan fell 0.23% to 0.9%. China's Shanghai Composite rose 0.43%. Stock markets in Japan, Indonesia and Hong Kong were shut for holidays.
China's exports unexpectedly fell in September and inflation jumped on food prices, signaling constraints on the nation's recovery as Premier Li Keqiang seeks to sustain growth without adding monetary stimulus. Overseas shipments dropped 0.3% from a year earlier, customs data showed on 12 October, while imports rose a more-than-forecast 7.4%. Consumer prices rose 3.1% as food costs advanced the most since May 2012, statistics bureau figures showed in Beijing.
Trading in US index futures indicated that the Dow could fall 93 points at the opening bell on Monday, 14 October 2013. Senate leaders over the weekend tried to broker a deal to re-open government now on shutdown Day 14 and to avoid bumping up against the debt ceiling on Oct. 17, but appeared to struggle to break the deadlock.
The Treasury Department's Oct. 17 deadline for raising the debt ceiling is rapidly approaching. Failure to raise the debt limit could be catastrophic for the US economy. Without an increase to the debt limit, the US will exhaust its borrowing authority on Thursday, 17 October 2013, and would run out of funds to pay all of its bills sometime between October 22 and October 31, according to the Congressional Budget Office.
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 as policy makers mull the timing of reductions in bond buying. Government data from payrolls to retail sales will be delayed as long as the shutdown continues. 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.
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