After trimming intraday gains in afternoon trade, key benchmark indices surged in mid-afternoon trade. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit their highest level in almost a week. The Sensex was currently up 220.40 points or 0.83% at 26,906.91. The broad market depicted strength. There were almost two gainers against for every loser on BSE. The BSE Mid-Cap index was up 1.67%. The BSE Small-Cap index was up 1.5%. Both these indices outperformed the Sensex.
Meanwhile, Central Board of Direct Taxes (CBDT) chairman Anita Kapur was quoted as saying at a press conference yesterday, 16 June 2015, that the income tax department would not attempt any coercive recovery of the minimum alternate tax (MAT) demands placed on foreign institutional investors (FIIs).
Index heavyweights HDFC, L&T and Reliance Industries edged higher. Cement stocks gained. Auto stocks also edged higher.
Meanwhile, the India Meteorological Department (IMD) said in its daily monsoon update issued yesterday, 16 June 2015, that the cumulative rainfall during this year's monsoon season was 13% above the Long Period Average (LPA) until 15 June 2015.
Meanwhile, a news agency quoted Arvind Virmani who is a member of the central bank's technical advisory panel as saying that the Reserve Bank of India (RBI) still has scope to cut interest rates by more than a percentage point given the slowdown in inflation.
In overseas markets, European stocks edged lower in volatile trade, with investors nervously digesting the lack of progress in Greece's debt talk with lenders ahead of a closely watched Eurogroup meeting later in the week. Asian stocks edged higher after US stocks registered modest gains overnight. US stocks edged higher yesterday, 16 June 2015, as investors shrugged off worries about unsuccessful Greek debt talks and awaited the outcome of a two-day Federal Reserve policy meeting.
Foreign portfolio investors (FPIs) sold shares worth a net Rs 521.65 crore yesterday, 16 June 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 644.81 crore yesterday, 16 June 2015, as per provisional data released by the stock exchanges.
At 14:17 IST, the S&P BSE Sensex was up 220.40 points or 0.83% at 26,906.91. The index jumped 255.48 points at the day's high of 26,941.99 in mid-afternoon trade, its highest level since 11 June 2015. The index rose 42.38 points at the day's low of 26,728.89 in morning trade.
The Nifty was up 68.30 points or 0.85% at 8,115.60. The index hit a high of 8,119.50 in intraday trade, its highest level since 11 June 2015. The index hit a low of 8,048.95 in intraday trade.
The market breadth indicating the overall health of the market was strong. There were almost two gainers against for every loser on BSE. 1,661 shares rose and 843 shares fell. A total of 133 shares were unchanged.
The BSE Mid-Cap index was up 170.72 points or 1.67% at 10,317.79. The BSE Small-Cap index was up 160.21 points or 1.5% at 10,815.05. Both these indices outperformed the Sensex.
Cement stocks edged higher on renewed buying. Shree Cement (up 2.85%), Ambuja Cements (up 1.12%) and UltraTech Cement (up 1.2%) edged higher.
Grasim Industries advanced 0.46%. Grasim has exposure to the cement sector through its holding in UltraTech Cement.
ACC gained after the company announced resumption of limestone mining operations at Bargarh cement works. The stock was up 1.01%. On 10 October 2014, ACC had informed about the suspension of limestone mining operations at the company's Bargarh cement works. The impact of the closure was not material since cement grinding continued with transfer of clinker from sister works/purchase of clinker.
Auto stocks edged higher. Mahindra & Mahindra (M&M) (up 1.2%), Maruti Suzuki India (up 0.23%) and TVS Motor Company (up 0.77%) gained. Bajaj Auto declined 0.35%.
Hero MotoCorp fell 0.85% to Rs 2,521.95. The stock hit high of Rs 2.579.85 and low of Rs 2,517 so far during the day. The company after market hours yesterday, 16 June 2015, announced the launch of the stylish and more powerful new Passion Pro bike. One of the most popular motorcycle brands in the country with over a million units in annual sales, Passion has captured the imagination of customers for over a decade, Hero MotoCorp said in a statement. The new Passion Pro is now available at all Hero dealerships across the country. It is available at Rs 50,057 (ex-showroom Mumbai), Rs 49,250 (ex-showroom Chennai), Rs 49,819 (ex-showroom Kolkata) and Rs 49,450 (ex-showroom Bangalore).
Shares of Ashok Leyland gained 1.31%. The stock turned ex-dividend today, 17 June 2015 for dividend of Rs 0.45 per share for the year ended 31 March 2015.
Eicher Motors rose 2.78% on reports a foreign brokerage has maintained outperform rating on the stock. The foreign brokerage has reportedly said that the introduction of new product platforms, enhanced sales and after-sales experience supported with capacity expansion would be the key growth drivers for Eicher Motors. Demand recovery in the commercial vehicles industry is now more widespread and growth seems sustainable, the brokerage has reportedly said.
Addition to order book remains strong, with waiting list of over five months despite sharp ramp-up in production, the brokerage reportedly said. Production guidance stays at 45,000 units/60,000 units for calendar years (CY) 2015 and 2016 respectively from the existing plant, the brokerage said. Royal Enfield has already acquired additional land for additional expansion needs, which can increase total production capacity to one million units, the brokerage reportedly said.
Meanwhile, Central Board of Direct Taxes (CBDT) chairman Anita Kapur was quoted as saying at a press conference yesterday, 16 June 2015, that the income tax department would not attempt any coercive recovery of the minimum alternate tax (MAT) demands placed on foreign institutional investors (FIIs). The tax department had asked several FIIs to pay 18.5% MAT on their trading income in India, forcing some of them to take it to the court. Although the government says that the notices have been served in only 68 cases involving a total demand of just Rs 603 crore for the period prior to 1 April 2015, FIIs are worried that more such notices could be in the offing. In the Union Budget 2015-16, the government exempted FIIs' trading income from MAT with effect from 1 April 2015.
Last month, the government set up a committee to examine the matter relating to the levying of MAT on FIIs for the period prior to 1 April 2015. Earlier, the government had said that FIIs can avail of treaty benefits to ward off the tax demands.
Meanwhile, a news agency quoted Arvind Virmani who is a member of the central bank's technical advisory panel as saying that the Reserve Bank of India (RBI) still has scope to cut interest rates by more than a percentage point given the slowdown in inflation. The consumer-price inflation rate has declined by three percentage points over the last 12 to 18 months, raising real interest rates by 2 to 3%, Virmani said.
Meanwhile, the India Meteorological Department (IMD) said in its daily monsoon update issued yesterday, 16 June 2015, that the Southwest Monsoon was active over Gangetic West Bengal and Telangana during past 24 hours ending at 0830 hrs. Conditions are favourable for further advance of southwest monsoon into some more parts of Chhattisgarh, Odisha and West Bengal and remaining parts of Coastal Andhra Pradesh and Bay of Bengal during next 3 days, the IMD said.
For the country as a whole, the cumulative rainfall during this year's monsoon season was 13% above the Long Period Average (LPA) until 15 June 2015. Region wise, the southwest monsoon was 22% above the LPA in East & Northeast India, 18% above the LPA in Central India and 1% below the LPA in Northwest India until 15 June 2015. The rainfall was 100% of the Long Period Average in South Peninsula.
The June-September southwest monsoon is critical for the country's agriculture because a considerable part of the country's farmland is dependent on the rains for irrigation.
In overseas markets, European stocks edged higher in volatile trade today, 17 June 2015, with investors nervously digesting the lack of progress in Greece's debt talk with lenders ahead of a closely watched Eurogroup meeting later in the week. Key benchmark indices in UK, France and Germany were off 0.04% to 0.17%.
Investors continue to watch developments in Greece. Greece Prime Minister Alexis Tsipras accused Greece's creditors yesterday, 16 June 2015, of trying to "humiliate" Greeks with more cuts as he defied a growing drumbeat of warnings that Europe was preparing for his country to leave the euro. The unrepentant address to lawmakers after the collapse of talks with European and International Monetary Fund (IMF) lenders at the weekend was the clearest sign yet that the leftist leader has no intention of making a last-minute U-turn and accepting austerity cuts needed to unlock frozen aid and avoid a debt default within two weeks.
Meanwhile, Austrian chancellor Werner Faymann is due to speak with Tsipras in Athens today, 17 June 2015, in an effort to break the deadlock, according to reports. Greece has a debt repayment of 1.6 billion euros ($1.8 billion) due at the end of this month to the International Monetary Fund after the European nation bundled all its four June repayments into one.
Meanwhile, a meeting of eurozone finance ministers is scheduled in Luxembourg tomorrow, 18 June 2015.
In UK, the minutes of Bank of England's (BOE) Monetary Policy Committee meeting which was held early this month showed that all nine panel members voted to keep the BOE's benchmark interest rate at 0.5% and voted unanimously to leave the size of the central bank's bond portfolio at 375 billion pounds ($585.44 billion).
Asian stocks edged higher today, 17 June 2015, after US stocks registered modest gains overnight. Key benchmark indices in China, Indonesia, South Korea, Hong Kong and Singapore were up 0.3% to 1.65%. Key benchmark indices in Taiwan and Japan were off 0.19% to 0.25%.
Japanese exports grew at the slowest pace in nine months in May as shipments to the US and China moderated, while export volumes for the month fell compared with a year earlier. Exports rose 2.4% from a year earlier to 5.741 trillion yen in May 2015, the finance ministry said today, 17 June 2015. The rate of expansion was the smallest since the start of a gentle uptrend in September, in a sign that a slowdown in the US and weakening growth in China may be beginning to hinder a Japanese economic recovery.
US stocks closed higher yesterday, 16 June 2015, as investors shrugged off worries about unsuccessful Greek debt talks and awaited the outcome of a two-day Federal Reserve policy meeting. In macroeconomic data in US, construction starts on new US homes fell 11.1% to an annual rate of 1.04 million in May, pulling back from a surge in April and missing expectations. But the annual pace of permits for new construction, a sign of future demand, rose 11.8% to 1.28 million in Ma, the fastest pace since August 2007.
A two-day meeting of the Federal Open Market Committee (FOMC) to review US monetary policy concludes today, 17 June 2015. The FOMC meeting is being keenly watched for further indication of the timing of an expected rate hike by the US central bank later this calendar year.
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