As European stocks nudged higher after European Central Bank (ECB) President Mario Draghi's comments sent a strong signal that the ECB is ready to step up asset-buying, key equity benchmark indices in India surged. The barometer index, the BSE Sensex, and the 50-unit CNX Nifty, both hit record on intraday basis as well as on closing basis. The Sensex jumped 267.07 points or 0.95% to settle at 28,334.63. The market breadth indicating the overall health of the market turned negative from positive in late trade. The BSE Small-Cap and Mid-Cap indices, both, slipped into the red from green in late trade.
Shares of Kotak Mahindra Bank edged higher after the bank and ING Vysya Bank after trading hours yesterday, 20 November 2014, announced that ING Vysya Bank will be merged with Kotak Mahindra Bank. Shares of ING Vysya Bank eked out small gains in volatile trade. Shares of many other private sector banks edged higher after the announcement of the Kotak Mahindra Bank and ING Vysya Bank merger deal. Shares of index heavyweight ITC and Reliance Industries edged higher.
In overseas markets, European stocks rose after European Central Bank (ECB) President Mario Draghi sent a strong signal in a speech delivered today, 21 November 2014, that the central bank is ready to step up the pressure and expand its asset-purchase programs if inflation fails to show signs of quickly returning to the ECB's target. Asian stocks rose after a report that China's central bank injected funds to ease a shortage of cash in the financial system. In the US, small gains took both the S&P 500 and the Dow Jones Industrial Average to record closing high yesterday, 20 November 2014, following some upbeat economic data and on better-than-expected earnings from retailers.
In the foreign exchange market, the rupee edged higher against the dollar as key equity benchmark indices in India hit record high.
Brent crude oil futures rose on speculation the OPEC cartel will overcome internal resistance to trim output at a meeting next week, while upbeat US economic data also provided support.
The S&P BSE Sensex jumped 267.07 points or 0.95% to settle at 28,334.63, a record closing high. The index jumped 293.10 points at the day's high of 28,360.66 in late trade, a lifetime high for the index. The index fell 29.16 points at the day's low of 28,038.40 in early trade.
The CNX Nifty rose 75.45 points or 0.90% to settle at 8,477.35, a record closing high. The index hit a high of 8,489.80 in intraday trade, a lifetime high for the index. The index hit a low of 8,398.60 in intraday trade.
The BSE Mid-Cap index fell 7.94 points or 0.08% to settle at 10,195.79. The BSE Small-Cap index fell 10.89 points or 0.10% to settle at 11,325.84. Both these indices underperformed the Sensex.
The market breadth indicating the overall health of the market turned negative from positive in late trade. On BSE, 1,635 shares fell and 1,375 shares gained. A total of 120 shares were unchanged.
The total turnover on BSE amounted to Rs 3362 crore, higher than Rs 3081.56 crore yesterday, 20 November 2014.
The S&P BSE Bankex (up 2.37%) and the S&P BSE Capital Goods index (up 1.32%) outperformed the Sensex. The S&P BSE IT index (down 0.72%), the S&P BSE Teck index (down 0.46%) and the S&P BSE Healthcare index (down 0.33%), the S&P BSE FMCG index (up 0.9%), the S&P BSE Oil & Gas index (up 0.86%), the S&P BSE Consumer Durables index (up 0.84%), the S&P BSE Auto index (up 0.54%), the S&P BSE Power index (up 0.23%), the S&P BSE Metal index (up 0.14%) and the S&P BSE Realty index (up 0.11%) underperformed the Sensex.
Among the 30 Sensex shares, 24 rose and the remaining shares declined.
Index heavyweight ITC rose 1.30% at Rs 373.95.
Another index heavyweight Reliance Industries was up 1.74% at Rs 997.45.
Shares of Kotak Mahindra Bank edged higher after the bank and ING Vysya Bank after trading hours yesterday, 20 November 2014, announced that ING Vysya Bank will be merged with Kotak Mahindra Bank. The stock was up 3.68% at Rs 1,199.65. The stock hit a record high of Rs 1,260.90 in intraday trade.
Shares of ING Vysya Bank eked out small gains in volatile trade. The stock was up 0.32% at Rs 816.80. The stock hit a high of Rs 849 and low of Rs 812 in intraday trade.
The board of directors of Kotak Mahindra Bank and ING Vysya Bank at separate board meetings held yesterday, 20 November 2014, considered and granted approval for the amalgamation of ING Vysya Bank with Kotak Mahindra Bank. A share swap ratio of 725 equity share of Rs 5 each of Kotak Mahindra Bank for every 1,000 equity shares of Rs 10 each of ING Vysya Bank has been fixed.
The proposed consolidation is founded on leveraging significant complementarities that exist between both the banks, particularly relating to branch network, product offerings and customer segments, Kotak Mahindra Bank and ING Vysya Bank said in a joint statement. This revenue synergy led and growth oriented amalgamation, adopting best practices of banking, governance and prudence from both banks is expected to result in a superior platform benefitting from efficiencies of size and scope over time for all stakeholders such as shareholders, customers, and employees, they said.
Yes Bank rose 4.01%. The Reserve Bank of India (RBI) on Thursday, 20 November 2014, notified that the aggregate share holdings in Yes Bank by Foreign Institutional Investors (FII)/Registered Foreign Portfolios Investors (RFPI)/Non-Resident Indians (NRI)/Persons of Indian Origin (PIO) and through American Depository Receipts (ADR)/Global Depository Receipts (GDR)/Foreign Direct Investment (FDI) has gone below the prescribed threshold caution limit stipulated under the extant FDI policy. Hence the restrictions placed on the purchase of shares of the above bank are withdrawn with immediate effect, the RBI said.
Among other private sector banks, Federal Bank (up 3.95%), City Union Bank (up 3.31%), ICICI Bank (up 2.66%), Axis Bank (up 2.17%), HDFC Bank (up 1.62%) and IndusInd Bank (up 1.17%), edged higher.
Shares of public sector banks also edged higher. Among public sector banks, Punjab National Bank (up 2.89%), State Bank of India (up 2.68%), UCO Bank (up 2.27%), Central Bank (up 2.06%), Vijaya Bank (up 2%), Bank of India (up 1.38%), State Bank of Bikaner (up 1.33%), Bank of Baroda (up 1.3%), United Bank of India (up 1.3%), Canara Bank (up 1.17%), Allahabad Bank (up 0.85%), Andhra Bank (up 0.78%), Dena Bank (up 0.5%), Syndicate Bank (up 0.24%) and Jammu & Kashmir Bank (up 0.23%), edged higher.
The finance ministry yesterday, 20 November 2014, said that the government is committed to keeping the public sector banks (PSBs) adequately capitalised with the twin objective of meeting the credit requirements of the productive sectors of the economy and meeting the regulatory capital adequacy requirements of PSBs. Towards this end, the government will be infusing Rs 11200 crore in PSBs shortly, the finance ministry said in a statement after a review of the quarterly performance of PSBs yesterday, 20 November 2014.
Capital goods shares were in demand. Alstom T&D India (up 5.22%), Bharat Heavy Electricals (up 3%), Havells India (up 1.6%), Larsen & Toubro (up 1.42%), Praj Industries (up 1.04%), Thermax (up 0.97%), ALSTOM India (up 0.92%), Siemens (up 0.8%), Lakshmi Machine Works (up 0.58%), Crompton Greaves (up 0.1%) and BEML (up 0.08%), edged higher.
Cairn India rose 1.37% as crude oil prices gained. Higher crude oil prices will result in higher realizations from crude sales for oil exploration firms such as Cairn India.
Tata Power Company lost 1.45% at Rs 88.10. The stock hit a high of Rs 89.95 and a low of Rs 87.80. The company after market hours yesterday, 20 November 2014, in a clarification with regard to news item titled Tata Power Plan Big Renewable Push with Wind Energy Bets said that the statements made by Mr. Rahul Shah is in line with the company stated plans to have 20-25% of its generation from Non-Greenhouse Gas sources over the next 8-10 years. The company aims to add 150-200 megawatts (MW) to its generation capacity every year through renewable energy sources, Tata Power Company said.
GMR Infrastructure rose 0.25% at Rs 20.15. The stock hit a high of Rs 20.50 and a low of Rs 19.90. The company before market hours today, 21 November 2014, said that GMR Male' International Airport (GMIAL), a subsidiary of GMR Infrastructure has submitted its claim for damages amounting to $803 million (Rs 4987 crore) with respect to repudiation of concession agreement between GMIAL and Maldives Airport Company (MACL) by Government of Maldives (GoM) and MACL. In addition, a plea for award of further damages for loss of reputation caused to GMR as a consequence of wrongful repudiation of the concession agreement has also been made to the Arbitral Tribunal, the quantification of which is subject to expert evidence, GMR Infrastructure said.
It may be recalled that GMIAL entered into a concession agreement with GoM and MACL for modernization and operation of Ibrahim Nasir International Airport (INIA) in 2010. The said concession agreement was repudiated by GoM and MACL and on 29 November 2012 arbitration proceedings were initiated by GoM and MACL themselves seeking a declaration that the concession agreement was void ab initio. The Arbitral Tribunal, by its Award dated 18 June 2014, ruled that the said concession agreement was valid and binding and that GoM and MACL were jointly and severally liable in damages to GMIAL for loss caused by their wrongful repudiation of the concession agreement.
Future Consumer Enterprise surged 9.14% at Rs 11.34 after the company said it has completed the acquisition of the Nilgiris convenience store chain in the southern states of Kerala, Karnataka, Andhra Pradesh and Tamil Nadu. The announcement was made before market hours today, 21 November 2014.
State Bank of India clocked a highest turnover of Rs 86.59 crore on BSE. Kotak Mahindra Bank (Rs 72.67 crore), MCX (Rs 52.35 crore), ING Vysya Bank (Rs 44.06 crore) and Amrutanjan Health Care (Rs 38.45 crore) were the other turnover toppers on BSE in that order.
Aadhaar Ventures India reported highest volumes of 2.50 crore shares on BSE. SpiceJet (2.19 crore shares), K Sera Sera Productions (1.42 crore shares), Visesh Infotechnics (1.20 crore shares) and TV18 Broadcast (56.77 lakh shares) were the other volume toppers on BSE in that order.
The Sensex has gained 301.78 points or 1.08% in two trading sessions from a recent low of 28,032.85 on 19 November 2014. The Sensex has gained 468.80 points or 1.68% in this month so far (till 21 November 2014). The Sensex has gained 7,163.95 points or 33.84% in calendar year 2014 so far (till 21 November 2014). From a 52-week low of 19,963.12 on 4 February 2014, the Sensex has risen 8,371.51 points or 41.93%.
In the foreign exchange market, the rupee edged higher against the dollar as key equity benchmark indices in India hit record high. The partially convertible rupee was hovering at 61.79, compared with its close of 61.95 during the previous trading session.
Brent crude oil futures rose on speculation the OPEC cartel will overcome internal resistance to trim output at a meeting next week, while upbeat US economic data also provided support. Brent crude for January settlement was up $1.26 a barrel at $80.59 a barrel. The contract had jumped $1.23 a barrel to finish at $79.33 a barrel yesterday, 20 November 2014.
Oil ministers from the Organization of the Petroleum Exporting Countries (OPEC) are scheduled to meet in Vienna on 27 November 2014 to consider whether to adjust their output target of 30 million barrels per day (bpd) for early 2015.
Another key event on next week's calendar is the 24 November 2014 deadline for the expiry of Iran's nuclear agreement.
The Indian government will announce data on gross domestic product (GDP) for Q2 September 2014 after trading hours on 28 November 2014. India's GDP grew 5.7% in Q1 June 2014 over the corresponding period of the previous year.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 2 December 2014. The central bank aims to limit consumer-price gains to 8% by January 2015 and 6% by January 2016. Over the longer term, the RBI aims to limit consumer-price gains to 4%, within a 2% band. The annual rate of inflation based on the combined consumer price index (CPI) for urban and rural India eased to 5.52% in October 2014 from 6.46% in September 2014, data released by the government on 12 November 2014 showed.
The Union Cabinet yesterday, 20 November 2014, gave its approval to launch "Integrated Power Development Scheme" (IPDS) with the objective of strengthening of sub-transmission and distribution network in the urban areas. The scheme will help in reduction in AT&C losses, establishment of IT enabled energy accounting/auditing system, improvement in billed energy based on metered consumption and improvement in collection efficiency. The estimated cost of the present scheme with the components of strengthening of sub-transmission and distribution networks, including metering of consumers in the urban areas is Rs 32612 crore which includes the requirement of budgetary support from Government of India of Rs 25354 crore over the entire implementation period. The component of IT enablement of distribution sector and strengthening of distribution network approved by CCEA in June 2013 in the form of RAPDRP for 12th and 13th Plans will get subsumed in this scheme and CCEA-approved scheme outlay of Rs 44011 crore including a budgetary support of Rs 22727 crore will be carried over to the new scheme of IPDS. The process of sanction of projects wil commence immediately. After sanction of projects, contracts for execution of projects are to be awarded by States Discoms/Power Departments. The projects shall be completed within 24 months from date of award, a government statement said.
The Union Cabinet yesterday, 20 November 2014, also approved the launch of Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) with components to separate agriculture and non agriculture feeders facilitating judicious rostering of supply to agricultural and non-agricultural consumers in rural areas and strengthening and augmentation of sub transmission and distribution infrastructure in rural areas, including metering of distribution transformers/feeders/consumers. The estimated cost of the scheme is Rs 43033 crore which includes the requirement of budgetary support of Rs 33453 crore from Government of India over the entire implementation period. The Cabinet further approved that the balance work relating to rural electrification as per the approval of the Cabinet Committee on Economic Affairs (CCEA) in August 2013 with the norms of the ongoing scheme of RGGVY in 12th and 13th Plans will get subsumed in DDUGJY as a distinct component for rural electrification for which CCEA has already approved the scheme cost of Rs 39275 crore, including budgetary support of Rs 35447 crore. This outlay will be carried forward to the new scheme of DDUGJY in addition to the outlay of Rs 43033 crore, a government statement said. The scheme would help in improvement in hours of power supply in rural areas, reduction in peak load, improvement in billed energy based on metered consumption and providing access to electricity to rural households.
The process of sanction of projects will commence immediately, the government said. After sanction of projects, contracts for execution of projects will be awarded by States Discoms/Power Departments. The projects shall be completed within 24 months from date of award, the government statement said.
The Union Cabinet yesterday, 20 November 2014, also gave its approval for the North Eastern Region Power System Improvement Project (NERPSlP) for six states (Assam, Manipur, Meghalaya, Mizoram, Tripura and Nagaland) for strengthening of the Intra State Transmission and Distribution System at an estimated cost of Rs 5111.33 crore including capacity building expenditure of Rs 89 crore. The scheme is to be taken up under a new Central Sector Plan Scheme of Ministry of Power (MoP). The scheme is to be implemented with the assistance of World Bank loan and the budget of MoP. The project will be funded on 50:50 (World Bank loan: GoI) basis except the component of capacity building for Rs 89 crore for which GoI will bear entirely.
This project is a major step towards meeting the national objective of "Power to All" through enhancement in access of consumers to grid connected power supply through improving its availability and reliability, thereby facilitating inclusive growth. This shall also increase the per capita power consumption of these states which is lagging behind the average national consumption and shall contribute to the economic development of the North-Eastern Region.
European stocks edged higher today, 21 November 2014, after European Central Bank (ECB) President Mario Draghi sent a strong signal in a speech delivered today, 21 November 2014, that the central bank is ready to step up the pressure and expand its asset-purchase programs if inflation fails to show signs of quickly returning to the ECB's target. Key benchmark indices in UK, France and Germany were up 0.59% to 1.82%.
Speaking at the European Banking Congress in Frankfurt, Draghi said the central bank's policies would bring growth and inflation back on a sound path and it would continue to do what is necessary to raise inflation as fast as possible. Monetary policy can and will do its part to achieve this, he said, adding that other policies outside the central bank's responsibilities such as fiscal policy are needed to boost demand. Draghi said that at long-term horizons, expectations of future inflation remain anchored near the level that the ECB sees as consistent with its 2% objective. "Over shorter horizons, however, indicators have been declining to levels that I would deem excessively low," he said.
Asian stocks rose today, 21 November 2014, after a report that China's central bank injected funds to ease a shortage of cash in the financial system. Key benchmark indices in China, Hong Kong, Singapore, South Korea, Indonesia, and Taiwan were up 0.14% to 1.39%.
As per reports, China's central bank -- the People's Bank of China -- offered 50 billion yuan ($8.17 billion) of short-term funds to ease a shortage of cash in the financial system.
In Japan, the Nikkei 225 Average rose 0.33%. Japanese Prime Minister Shinzo Abe officially dissolved the lower house of parliament today, 21 November 2014, setting the stage for a snap election next month in what he said is a bid to win a mandate for his reflationary economic policies. The dissolution effectively renders all 480 members of the lower house jobless. They must all win back their seats in a poll expected to take place on 14 December 2014.
Citing worsening economic conditions, Mr. Abe announced earlier this week that he would postpone a national sales-tax increase scheduled for October 2015, and called an election for next month that he cast as a referendum on Abenomics, his economic program of easy money, government stimulus and structural changes.
Trading in US index futures indicated that the Dow could rise 111 points at opening bell today, 21 November 2014. Small gains took both the S&P 500 and the Dow Jones Industrial Average to record closing high yesterday, 20 November 2014, following some upbeat economic data and on better-than-expected earnings from retailers. Among yesterday's positive economic releases was a rise in existing home sales, a jump in the Philly Fed index and weekly jobless claims remaining below 300,000 for the 10th straight week. Consumer prices were flat in October, while US November Markit flash PMI was the weakest since January, declining for a third straight month.
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