Key benchmark indices extended losses and hit fresh intraday low in afternoon trade. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit their lowest level in more than a week. The Sensex was down 115.96 points or 0.52%, off 164.64 points from the day's high and up 20.59 points from the day's low. The market breadth, indicating the overall health of the market was weak. The BSE Small-Cap and Mid-Cap indices were off more than 1% each. The market sentiment was hit adversly after private weather forecaster Skymet on Tuesday, 15 April 2014, said it expects the June-September monsoon to be below normal this year. The forecast of below-normal rains triggered worries that food price inflation will edge up. Increase in global crude oil prices also hit sentiment on the domestic bourses adversely.
Increase in crude oil prices triggered concerns about India's current account deficit and fiscal deficit. Brent oil edged higher on Tuesday, 15 April 2014, after news that Ukrainian armed forces launched military operations in the east of the country. The June contract for Brent settled 29 cents higher at $109.36 a barrel on Tuesday, 15 April 2014. India imports majority of its crude oil requirements.
IT major Tata Consultancy Services (TCS) dropped ahead of its Q4 results today, 16 April 2014. Infosys declined after the company's American depositary receipt (ADR) dropped on the New York Stock Exchange on Tuesday, 15 April 2014, after the company announced its Q4 March 2014 results and issued guidance for the year ending 31 March 2015 (FY 2015). Index heavyweight and cigarette major ITC edged higher in volatile trade. Interest rate sensitive realty stocks edged lower.
A bout of initial volatility was witnessed as key benchmark indices regained positive terrain after slipping into the red for a brief period after opening slightly higher. Volatility continued as key benchmark indices regained positive once again after reversing intraday gains in morning trade. Key benchmark indices were trading marginally higher in mid-morning trade, having moved in a narrow range. The Sensex slipped into the red in early afternoon trade. Key benchmark indices extended losses and hit fresh intraday low in afternoon trade. The Sensex and the 50-unit CNX Nifty, both, hit their lowest level in more than a week.
Foreign institutional investors (FIIs) sold shares worth a net Rs 21.63 crore on Tuesday, 15 April 2014, as per provisional data from the stock exchanges.
At 13:15 IST, the S&P BSE Sensex was down 115.96 points or 0.52% to 22,368.97. The index declined 136.55 points at the day's low of 22,348.38 in afternoon trade, its lowest level since 7 April 2014. The index rose 48.69 points at the day's high of 22,533.61 in early trade.
The CNX Nifty was down 35.85 points or 0.53% to 6,697.25. The index hit a low of 6,691.55 in intraday trade, its lowest level since 7 April 2014. The index hit a high of 6,748.65 in intraday trade.
The BSE Mid-Cap index was off 81.57 points or 1.12% at 7,230.42. The BSE Small-Cap index was down 88.68 points or 1.18% at 7,412.82. Both these indices underperformed the Sensex.
The market breadth, indicating the overall health of the market was weak. On BSE, 1,529 shares declined and 952 shares gained. A total of 131 shares were unchanged.
The total turnover on BSE amounted to Rs 1641 crore by 13:15 IST.
Bharat Heavy Electricals (Bhel) (down 2.45%), Hero MotoCorp (down 1.72%) and NTPC (down 1.71%) edged lower from the Sensex pack.
Maruti Suzuki India (up 1.17%), Tata Steel (up 0.83%) and ICICI Bank (up 0.63%) edged higher from the Sensex pack.
Index heavyweight and cigarette major ITC rose 1.13% to Rs 344.85 in volatile trade. The stock hit high of Rs 346.75 and low of Rs 340 so far during the day.
IT major TCS dropped 1.77% ahead of its Q4 results today, 16 April 2014.
Infosys declined after the company's American depositary receipt (ADR) dropped on the New York Stock Exchange on Tuesday, 15 April 2014, after the company announced its Q4 March 2014 results and issued guidance for the year ending 31 March 2015 (FY 2015). The stock was off 2.41%. The company's ADR fell 4.68% to settle at $52.98 on the New York Stock Exchange on Tuesday, 15 April 2014.
Infosys before trading hours in India on Tuesday, 15 April 2014, said its consolidated net profit rose 4.1% to Rs 2992 crore on 1.2% decline in revenue to Rs 12875 crore in Q4 March 2014 over Q3 December 2013. Infosys' non-operational income jumped 16.4% to Rs 851 crore in Q4 March 2014 over Q3 December 2013. The results are as per International Financial Reporting Standards.
Infosys has forecast revenue growth of 7% to 9% in dollar terms for the year ending 31 March 2015 (FY 2015). The company has forecast revenue growth of 5.6% to 7.6% in rupee terms for FY 2015. The guidance in rupee terms is based on rupee dollar conversion rate of 60.
Interest rate sensitive realty stocks edged lower. DLF (down 3.71%), D B Realty (down 2.19%), Indiabulls Real Estate (down 3.83%), Housing Development and Infrastructure (down 4.82%), Sobha Developers (down 0.89%) and Unitech (down 4.76%) declined.
Just Dial gained 4.55% to Rs 1,240.25, with the stock reversing recent slide on bargain hunting. Shares of Just Dial were on a downward journey recently, declining 25.59% in six trading days to settle at Rs 1,186.30 on Tuesday, 15 April 2014, from a recent high of Rs 1,594.35 on 3 April 2014.
Dhanuka Agritech surged 3.43% to Rs 245.55 after 1.99% equity changed hands in a bulk deal on BSE today, 16 April 2014. A bulk deal of 10 lakh shares was executed on Dhanuka Agritech counter at Rs 243.90 per share at 10:34 IST on BSE today, 16 April 2014.
In the foreign exchange market, the rupee edged lower against the dollar as stocks fell. The partially convertible rupee was hovering at 60.29, compared with its close of 60.23/24 on Tuesday, 15 April 2014.
Private weather forecaster Skymet on Tuesday, 15 April 2014, said it expects the June-September monsoon to be below normal this year. It has forecast the monsoon at 94% (error margin of +/-4%) of the long period average (LPA) of 896 mm for the four-month period from June to September 2014. In terms of geographical risk, Skymet suggests that peninsular India will be at less risk through June, July, August and September (JJAS). There seems to be weakness in majority subdivisions in Northwest India viz. Gujarat, Saurashtra, Kutch, Punjab, Rajasthan and Haryana and in West-Central India viz. East MP, West MP, Chhattisgarh, Vidarbha, Marathwada, Madhya Maharshtra, Konkan & Goa, North Interior Karnataka and Telangana during the whole season, Skymet said in a statement. August is expected to be the best month among the four, although negative. It appears that onset of the monsoon may be staggered this time, Skymet said.
Jatin Singh, CEO, Skymet said: "This weakness in monsoon could possibly be attributed to an evolving ENSO". The ENSO is a phenomenon wherein the Central and East Pacific ocean warms (El Ni) or cools (La Ni), in turn affecting the monsoon. El Ni is evolving as of now, but is expected to get arrested, Skymet said. There is only a 30% chance of this phenomenon getting stronger, it said. If this El Ni was amplifying, then there would be a stronger chance of drought, like in 2009, Skymet said. This does not seem to be the case at this point in time, it said. There is no clear signal about the emergence of Indian Ocean Dipole (IOD) this year during monsoon, Skymet said.
According to Skymet, rains in June are expected at 90% of LPA (LPA = 174 mm). In July, the monsoon is expected at 94% of LPA (LPA = 285 mm). Rains in August are expected at 98% of LPA (LPA = 253 mm). Rains in September are expected at 90% of LPA (LPA = 184 mm).
The rate on inflation based all India general consumer price index (CPI) combined for urban and rural India accelerated to 8.31% (provisional) in March 2014, from 8.03% (final) in February 2014, led by increase in food prices, data released by the government after trading hours on Tuesday, 15 April 2014, showed. Core CPI inflation which excludes food and fuel prices eased to 7.82% in March 2014, from 7.84% in February 2014.
CPI inflation eased to 9.5% for the year ended 31 March 2014 (FY 2014), from 10.2% for the year ended 31 March 2013 (FY 2013).
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014, as consumer-price inflation eased to a two-year low and as the rupee firmed up against the dollar.
A major near term trigger for the stock market is the outcome of the upcoming Lok Sabha elections. The 36 days long voting process began on 7 April 2014 and will conclude on 12 May 2014. The results will be declared on 16 May 2014 after which India will get a new government. The term of the current Lok Sabha expires on 1 June and the new House has to be constituted by 31 May.
European stocks edged higher on Wednesday, 16 April 2014, with resource firms posting some of the biggest gains after better-than-expected growth data from China. Key benchmark indices in UK, France and Germany were up 0.7% to 1.06%.
Asian stocks edged higher on Wednesday, 16 April 2014, as China reported data on economic growth for the January-to-March period which was better than estimates. Key benchmark indices in Japan, Singapore, Indonesia, Hong Kong and Taiwan were up 0.08% to 3.01%. In South Korea, Seoul Composite index was off 0.06 points at 1,992.21.
In mainland China, the Shanghai Composite was up 0.17% in choppy trade. China's expansion slowed to the weakest pace in six quarters, testing leaders' commitment to keep reining in a credit boom and pollution as risks mount of missing a 7.5% annual growth target. However, the growth was slightly higher than market expectations. Gross domestic product rose 7.4% in the January-to-March period from a year earlier, the National Bureau of Statistics said today in Beijing.
Fixed-asset investment in non-rural areas of China rose 17.6% in the January-March period compared with the same period a year earlier, data from the National Bureau of Statistics showed. The rise in the closely watched indicator of construction activity was slower than the 17.9% increase recorded in the January-February period.
Retail sales in China rose 12.2% in March from a year earlier, accelerating from a 11.8% on-year rise for January and February, data from the National Bureau of Statistics showed. Retail sales also increased 1.23% in March from February. In February, they rose 0.71%.
China's industrial production grew 8.8% in March, slightly below market expectations of 9% growth.
Trading in US index futures indicated that the Dow could advance 69 points at the opening bell on Wednesday, 16 April 2014. US stocks rose in choppy trade on Tuesday, 15 April 2014, as earnings from Coca-Cola Co. and Johnson & Johnson overshadowed concerns that tensions in Ukraine are worsening.
The latest US economic data showed manufacturing in the New York region grew at a slower pace in April while the cost of living in the US rose more than projected in March as food and rents became more expensive. Confidence among US homebuilders rose less than forecast in April, as sales and prospective buyer traffic stagnated, showing the residential real estate market struggled to improve after a harsh winter.
The US Federal Reserve is considering further steps to force big banks to hold more capital, and sees a case for other stability-enhancing measures for more shadowy areas of Wall Street as well, Fed Chair Janet Yellen said on Tuesday. The Fed has been pushing banks to strengthen their balance sheets since the 2007-2009 financial crisis, and last week joined other regulators in requiring the eight largest US banks to increase their capital levels by some $68 billion in total.
She cited a 2010 study by the Basel Committee, an international standard-setting body, that suggested tighter standards would provide economic benefits.
The United States is in the process of implementing new international capital and liquidity standards known as Basel III, which will be phased in between 2015 and early 2019. The rules are meant to help banks weather short-term funding crises.
Yellen said the US central bank's staff was "actively considering" whether even more needed to be done to address risks in the so-called short-term wholesale funding market, which is a significant source of funding for firms.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 29-30 April 2014. The Federal Reserve on 19 March 2014 decided after the conclusion of a monetary policy review to trim its monthly bond purchases by $10 billion to $55 billion.
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