Key benchmark indices dropped for fourth day in a row as investors turned cautious ahead of the Reserve bank of India's (RBI) first quarter review of Monetary Policy 2013-14 tomorrow, 30 July 2013, after the central bank announced measures this month to tighten liquidity in the banking system to arrest slide in rupee against the dollar. The S&P BSE Sensex and the 50-unit CNX Nifty, both, settled at 2-1/2-week low. The Sensex was down 154.91 points or 0.78%, off 157.75 points from the day's high and up 22.41 points from the day's low. The market breadth, indicating the overall health of the market, was weak.
Indian stocks fell for the fourth straight session today, 29 July 2013. The Sensex has fallen 708.85 points or 3.49% in four trading sessions from a recent high of 20,302.13 on 23 July 2013. The Sensex has risen 197.47 points or 1.02% so far in July 2013 (till 29 July 2013). The Sensex has gained 166.57 points or 0.86% in calendar 2013 so far (till 29 July 2013). From a 52-week high of 20,443.62 on 20 May 2013, the Sensex has fallen 850.34 points or 4.16%. From a 52-week low of 16,760.72 on 27 July 2012, the Sensex has surged 2,832.56 points or 16.9%.
Coming back to today's trade, FMCG major Hindustan Unilever (HUL) extended Friday's losses triggered by the company reporting a muted growth in bottom line in Q1 June 2013. Cement pivotals Ambuja Cements and ACC edged lower. UltraTech Cement edged higher in volatile trade, with the stock shrugging off the company's weak Q1 result. Jaiprakash Associates dropped in choppy trade as the company's bottom line in Q1 June 2013 was boosted by one-time exceptional income on sale of shares of a subsidiary.
IDFC declined after the infrastructure lender's first quarter results showed that its sticky loans rose. IT major Wipro surged as the company issued upbeat revenue guidance for Q2 September 2013 at the time of announcing Q1 June 2013 results after trading hours on Friday, 26 July 2013. Shares of other IT firms also gained after Wipro's upbeat Q2 revenue guidance. Sterlite Industries (India) extended Friday's losses triggered by the company reporting weak Q1 results. Hindalco Industries also extended Friday's sharp losses.
Bharti Infratel fell after declaring Q1 result. Colgate Palmolive (India) dropped in volatile trade after declaring Q1 results. Engineering and construction giant L&T cut intraday losses after the company said that it has secured an order worth $1.4 billion (Rs 8250 crore) from the ArRiyadh Development Authority for a metro rail project in Riyadh, Saudi Arabia. Shares of steel companies edged lower in volatile trade. Realty stocks edged lower.
The S&P BSE Sensex was down 154.91 points or 0.78% to 19,593.28, its lowest closing level since 10 July 2013. The index declined 177.32 points at the day's low of 19,570.87 in late trade, its lowest level since 11 July 2013. The index rose 2.84 points at the day's high of 19,751.03 in early trade.
The CNX Nifty was down 54.55 points or 0.93% to 5,831.65, its lowest closing level since 10 July 2013. The index hit a low of 5,825.80 in intraday trade, its lowest level since 10 July 2013. The index hit a high of 5,886 in intraday trade.
The BSE Mid-Cap index fell 1.31% and the BSE Small-Cap index fell 0.86%. Both these indices underperformed the Sensex.
Among the sectoral indices on BSE, the S&P BSE IT (up 0.77%), the S&P BSE Auto (up 0.36%), the S&P BSE Teck (up 0.15%), S&P BSE Healthcare (down 0.42%), the S&P BSE Power (down 0.7%), the S&P BSE Capital Goods (down 0.77%) outperformed the Sensex.
The S&P BSE Consumer Durables (down 1.06%), the S&P BSE Oil & Gas (down 1.16%), the S&P BSE Bankex (down 1.2%), the S&P BSE Realty (down 1.65%), the S&P BSE PSU (down 1.8%), the S&P BSE Metal (down 1.8%) and the S&P BSE FMCG (down 2.67%) underperformed the Sensex.
The total turnover on BSE amounted to Rs 1753 crore, lower than Rs 2100.94 crore on Friday, 26 July 2013.
The market breadth, indicating the overall health of the market, was weak. On BSE, 1,387 shares declined and 848 shares rose. A total of 146 shares were unchanged.
Among the 30-share Sensex pack, 21 stocks fell and rest of them rose.
Reliance Industries (RIL) and ONGC, both, edged lower even as the two companies entered into a memorandum of understanding (MoU) to explore the possibility of sharing RIL's infrastructure facility in the East Coast. RIL was down 0.21% and ONGC fell 1.89%. The MoU aims at working out the modalities for sharing of infrastructure, identifying additional requirements as well as firming up the commercial terms. This shall not only minimise ONGC's initial capital expenditure but also expedite its field development, resulting in early monetization of its deep water fields adjacent to the fields of RIL. The companies intend to enter into a definitive agreement after concluding a joint study which will be spread over the next nine months, RIL said in a statement.
Power generation major NTPC rose 0.32%. The stock rose after the Ministry of Coal on Friday, 26 July 2013, said that state-run coal miner Coal India has signed fuel supply agreements (FSAs) until 25 July 2013 for 16 power stations belonging to NTPC and its joint venture companies (JVs). Eleven more FSAs are ready to be signed shortly with NTPC or its JVs, while another 23 FSAs with state and private sector entities are in the pipeline, the coal ministry said.
Shares of Coal India (CIL) were off 2.99%. CIL has signed a total of 82 fuel supply agreements (FSAs) until 25 July 2013 with power stations of various power generation companies with a capacity of 34,793 megawatts (MW). These FSAs were part of the 131 FSAs for a capacity of 60,678 MW which CIL was directed to sign in February 2012. This will substantially increase the power generation during the current and subsequent years, the coal ministry said.
In yet another fillip to the power sector, the Ministry of Coal has issued another Presidential Directive to CIL on 17 July 2013 for signing of FSAs for a capacity of 78,000 MW, higher than the earlier 60,678 MW. This will not only increase the power generation further but will also fast track several power projects which are under development, the coal ministry said.
Index heavyweight and cigarette major ITC lost 3.22% to Rs 356.65
FMCG major Hindustan Unilever (HUL) fell 3.95%, with the stock extending Friday's 3.38% losses triggered by the company reporting a muted growth in bottom line in Q1 June 2013. The company's net profit declined 23.43% to Rs 1019.25 crore on 5.88% increase in total income to Rs 6985.79 crore in Q1 June 2013 over Q1 June 2012. The result was announced during trading hours on Friday, 26 July 2013.
The company said that the year on year fall in net profit was due to significant exceptional income generated in Q1 June 2012 from the sale of properties. Profit after tax but before exceptional items rose 4% to Rs 885 crore in Q1 June 2013 over Q1 June 2012. HUL stated that while commodity costs were relatively benign, PFAD prices started to move up and the rupee sharply depreciated towards the end of the quarter. Competitive intensity remained at high levels and the company continued to invest in its brands. Advertisement and promotion (A&P) cost increased by Rs 70 crore on year on year basis in Q1 June 2013.
Colgate Palmolive (India) lost 1.52% to Rs 1,418 in volatile trade after announcing Q1 results during market hours today, 29 July 2013. The stock hit a high of Rs 1,457 and low of Rs 1,383. The company's net profit rose 57.74% to Rs 185.22 crore on 14.27% rise in total income to Rs 876.81 crore in Q1 June 2013 over Q1 June 2012.
The company recorded an exceptional item of Rs 55.50 crore (net of tax) with respect to the slump sale of Global Shares Services Organisation to Colgate Global Business Services, a wholly-owned subsidiary of Colgate-Palmolive Company, USA, after obtaining the requisite approvals from the board of directors and shareholders.
The company's profit from operations before other income, finance costs and exceptional items was almost flat with just 1.05% increase to Rs 153.54 crore in Q1 June 2013 over Q1 June 2012.
During the quarter, the company achieved a volume growth of 9% Q1 June 2013 over Q1 June 2012 led by a strong growth of 11% in its toothpaste category and further enhanced its leadership position by registering a 55.9% volume market share for January-June 2013 compared with 54.7% in January-June 2012.
The company further strengthened its leadership position in the toothbrush category by registering a volume market share of 41.4% in January-June 2013 as against 38.7% in January-June 2012.
Sun Pharmaceutical Industries was up 1.91% at Rs 569.50. The stock turned ex-bonus today, 29 July 2013 for 1:1 bonus issue.
Dr Reddys Laboratories shed 3.89%. The company announced on Saturday, 27 July 2013, that it has launched a drug for the treatment of dementia of the Alzheimer's type. The drug is a therapeutic equivalent generic version of ARICEPT. ARICEPT had US sales of approximately $92.6 million for twelve months ended May 2013, according to IMS Health data.
Lupin rose 0.20%. The stock turned ex-dividend today, 29 July 2013, for dividend of Rs 4 per share for the year ended 31 March 2013 (FY 2013).
Natco Pharma was locked at 20% upper circuit at Rs 588.10, also its record high, after the US Court of Appeals for the Federal Circuit ruling, reversed a district court's finding related to Teva's US Patent for Copaxone. The announcement was made during trading hours today, 29 July 2013.
This would essentially mean that Natco could launch the generic Copaxone through its marketing partner Mylan Inc., during May 2014, subject to FDA approval, the company said.
Copaxone (Glatiramer Acetate) is used in the treatment of relapsing-remitting multiple sclerosis. The product is estimated to have clocked revenues, in USA, of about $3.45 billion during 2012
Engineering and construction giant L&T cut intraday losses after the company said that it has secured an order worth $1.4 billion (Rs 8250 crore) from the ArRiyadh Development Authority for a metro rail project in Riyadh, Saudi Arabia. The stock shed 0.66% at Rs 840.05. The stock cut losses after hitting 52-week low of Rs 836 in intraday trade after the company said during market hours today, 29 July 2013, that its construction division secured an order worth $ 1403 million (Rs 8250 crore) from the ArRiyadh Development Authority, kingdom of Saudi Arabia for the design, construction and comissioning of metro project in Riyadh, Saudi Arabia. L&T has secured the order as a JV partner of ArRiyadh New Mobility consortium. The total value of the order is $5.94 billion. The project is to be completed during a period of four years, which will be preceded by eight months to prepare the detailed designs and to carry out the enabling works, the coordination for utilities diversion and the site preparation works, and followed by four months of system demonstration, trial run and project handing over.
Shares of power equipment major Bharat Heavy Electricals dropped 1.13% to Rs 157. The stock had hit 52-week low of Rs 156.10 in intraday trade on Friday, 26 July 2013.
Jaiprakash Associates dropped in choppy trade as the company's bottom line in Q1 June 2013 was boosted by one-time exceptional income on sale of shares of a subsidiary. The stock lost 4.43% at Rs 39.90. The stock rose 2.51% at the day's high of Rs 42.80 shortly after the company's Q1 result hit the market in mid-morning trade. Ahead of the results, the stock had lost as much as 6.34% at the day's low of Rs 39.10 in early trade.
The company's net profit surged 140.93% to Rs 334.51 crore on 10.38% rise in total income to Rs 3351.93 crore in Q1 June 2013 over Q1 June 2012. The company announced Q1 result during market hours today, 29 July 2013. The surge in net profit was due to an exceptional non-recurring income on sale of stake in its subsidiary Jaypee Infratech to meet the minimum public shareholding norms (MPS) of Jaypee Infratech. The company made a profit of Rs 395.28 crore on sale of 16 crore equity shares of Jaypee Infratech.
Bank stocks were mixed. HDFC Bank fell 1.71%. ICICI Bank shed 0.24%.
PSU bank major State Bank of India declined 1.18%.
Punjab National Bank fell 2.66%, with the stock extending Friday's 5.15% losses triggered by a surge in the bank's gross non-performing assets in Q1 June 2013. The bank's net profit rose 2.38% to Rs 1275.32 crore on 0.21% rise in total income to Rs 11746.59 crore in Q1 June 2013 over Q1 June 2012. The bank announced Q1 result during market hours on Friday, 26 July 2013.
Lakshmi Vilas Bank lost 1.05% as the stock turned ex-dividend today, 29 July 2013, for dividend of Rs 3 per share for the year ended 31 March 2013.
Indian Bank lost 7.92% after net profit declined 31.26% to Rs 317.39 crore on 16.65% growth in total income to Rs 4195.47 crore in Q1 June 2013 over Q1 June 2012. The Q1 result was announced during market hours today, 29 July 2013.
Indian Bank's ratio of net non-performing assets (NPA) increased to 2.31% as on 30 June 2013, from 2.26% as on 31 March 2013 and 1.04% as on 30 June 2012. The ratio of gross NPA to gross advances increased to 3.41% as on 30 June 2013, from 3.33% as on 31 March 2013 and 1.66% as on 30 June 2012.
The bank's provisions and contingencies surged 152.65% to Rs 368.12 crore in Q1 June 2013 over Q1 June 2012.
Indian Bank's capital adequacy ratio (CAR) as per Basel II norms stood at 13.06% as on 30 June 2013, as against 13.08% as on 31 March 2013 and 12.98% as on 30 June 2012. CAR as per Basel III norms as on 30 June 2013 works out to 12.58%.
The bank's provision coverage ratio works out to 61.25% as on 30 June 2013.
IDFC declined after the infrastructure lender's first quarter results showed that its sticky loans rose. The stock lost 4.63%. IDFC's consolidated net profit rose 46.74% to Rs 557.31 crore on 24.83% rise in total income from operations (net) to Rs 2298 crore in Q1 June 2013 over Q1 June 2012. The company announced Q1 result during market hours today, 29 July 2013.
Based on standalone financials, the lender's gross non-performing assets edged up to Rs 181.67 crore in Q1 June 2013, from Rs 85.12 crore as on 31 March 2013 and Rs 150.26 crore as on 30 June 2012. The ratio of gross non-performing assets (NPA) to gross advances stood at 0.32% as on 30 June 2013, higher that 0.15% as on 31 March 2013 and 0.3% as on 30 June 2012. The lender's ratio of net non-performing assets (NPA) to net advances stood at 2.81% as on 30 June 2013, higher than 2.61% as on 31 March 2013 and 2.47% as on 30 June 2012.
IDFC said profit after tax (PAT) net of principal gains, rose 33% to Rs 504 crore in Q1 June 2013 over Q1 June 2012.
IDFC's provisions and contingencies dropped 43% to Rs 59 crore in Q1 June 2013 over Q1 June 2012.
The balance sheet size grew by 10% to Rs 71655 crore as on 30 June 2013, from Rs 65017 crore as on 30 June 2012. The gross loan book rose 13% to Rs 57600 crore as on 30 June 2013, from Rs 50892 crore as on 30 June 2012. Gross approvals plunged 78% to Rs 2833 crore in Q1 June 2013, from Rs 12809 crore in Q1 June 2012. Gross disbursements declined 28% to Rs 3211 crore in Q1 June 2013 from Rs 4487 crore in Q1 June 2012.
UltraTech Cement rose 1.07% to Rs 1885 in volatile trade after Q1 result. The stock hit high of Rs 1892.50 and low of Rs 1835.35. The company's net profit fell 13.49% to Rs 673 crore on 2.24% decline in net sales to Rs 4958 crore in Q1 June 2013 over Q1 June 2012. The company announced Q1 result during market hours today, 29 July 2013.
UltraTech Cement said that the quarter witnessed an increasing trend in logistics and raw material costs, linked to increase in railway freight and diesel prices. The benefit of softening in prices of imported coal was partly offset by rupee depreciation, the company said.
UltraTech Cement said that the clinkerisation plant of 3.3 million metric tonnes in Karnataka has been commissioned. The company's board of directors has further sanctioned capital expenditure (capex) of Rs 2100 crore towards setting up grinding units and ready mix concrete plants across the country and also towards modernization. With this, the total capex under implementation is around Rs 13700 crore. UltraTech Cement said that the company is in the process of ramping up capacity by another 10 million tonnes by 2015. This will result in the company's total cement capacity getting augmented to 64.45 million tonnes.
The cement major said that the outlook continues to remain challenging. Growth in cement demand in the year ended 31 March 2014 (FY 2014) is expected to be around 6%, the company said. Over the long run, the demand for cement is likely to be at over 8%, with housing and infrastructure being the key demand drivers, the company said.
Madras Cements lost 3.97% on weak Q1 results. The company's net profit declined 44.02% to Rs 68.85 crore on 0.35% decline in total income to Rs 989 crore in Q1 June 2013 over Q1 June 2012. The result hit the market during trading hours today, 29 July 2013.
Madras Cements said that the board of directors of the company at its meeting held today, 29 July 2013, has decided to form a subsidiary company and transfer windmills of an aggregate capacity of 23.23 megawatts (MW) to the proposed subsidiary company. The company's total wind farm capacity is 159.19 MW. After transfer of the windmills of capacity 23.23 MW to the proposed subsidiary, the balance windmills of capacity 135.96 MW will continue to remain with the company.
IT major Wipro surged 6.71% to Rs 408.50 and was the top gainer from the Sensex pack. The company issued upbeat revenue guidance for Q2 September 2013 at the time of announcing Q1 June 2013 results after trading hours on Friday, 26 July 2013. Wipro expects 1.99% to 3.88% growth in revenue from IT services business at between $1.62 billion to $1.65 billion in Q2 September 2013 over Q1 June 2013.
The company's consolidated net profit rose 3% to Rs 1623.30 crore on 1% growth in revenue to Rs 9734.60 crore in Q1 June 2013 over Q4 March 2013. The results are as per International Financial Reporting Standards. The results are after adjusting for the spinoff of its non-technology businesses, completed in April.
IT services revenue rose 0.2% to $1.58 billion in Q1 June 2013 over Q4 March 2013. Non-GAAP constant currency IT services revenue in dollar terms was $1.60 billion, which was within the company's guidance range of $1.575 billion to $1.61 billion.
Wipro said that the pricing environment was largely stable during the quarter, and the growth was largely volume led. Effective from 1 June 2013, Wipro gave annual wage hike of between 6-8% for offshore employees and 2-3% for onsite employees.
Wipro added 28 new customers in Q1 June 2013.
Shares of other IT firms also gained after Wipro's upbeat Q2 revenue guidance. Infosys gained 0.15%. Tech Mahindra gained 2.36%. But, HCL Technologies fell 0.76%.
TCS rose 0.09%. TCS said during market hours today, 29 July 2013, that it has won a three year contract from the Zambia Revenue Authority (ZRA) for the modernisation of its domestic tax system.
Shares of TCS turned ex-dividend today, 29 July 2013, for interim dividend of Rs 4 per share for the year ended 31 March 2013 (FY 2013).
Financial Technologies (India) (FTIL) recovered after Friday's near 9% slide. The stock was up 1.33% to Rs 574.40. The stock recovered after the company after trading hours on Friday, 26 July 2013, said bear cartels are working against the interest of the company by spreading a number of malicious rumours and warned that the company reserves its rights to take necessary legal action, including complaining to stock market regulator Securities & Exchange Board of India (Sebi) and all other relevant authorities to investigate and take necessary action into this malicious campaign against the company. The series of rumours that are spread in the market have a pattern more particularly to spread on Friday and such rumours are spread by some unscrupulous elements with a design to depress the share price of FTIL and damage its reputation, the company said.
Sterlite Industries (India) fell 2.94%, with the stock extending Friday's losses triggered by the company reporting weak Q1 results. Sterlite Industries' consolidated net profit fell 22% to Rs 934 crore on 23% fall net sales/income from operations to Rs 8190 crore in Q1 June 2013 over Q1 June 2012. The Q1 result was announced on 25 July 2013.
Hindalco Industries dropped 4.13%, with the stock extending Friday's steep losses. The stock had tumbled 7.59% on Friday, 26 July 2013.
Shares of steel companies declined in volatile trade. Sail (down 1.37%), JSW Steel (down 1.02%), Tata Steel (down 1.87%) edged lower. Jindal Steel & Power jumped 4.89% to Rs 199.35 ahead of its Q1 results tomorrow, 30 July 2013.
Sesa Goa declined 3.39%. The company after market hours today, 29 July 2013 reported 78.19% fall in consolidated net profit to Rs 378 crore on 57.05% fall in net sales/income from operations to Rs 414 crore in Q1 June 2013 over Q1 June 2012.
The Company said it posted a loss before depreciation and taxes for Q1 June 2013 at Rs 284 crore as against profit before depreciation and taxes of Rs 321 crore in Q1 June 2012. Decline in cash profit is mainly on account of suspension of iron ore operations in Goa and Karnataka.
The company said during Q1, iron ore operations in both the states of Goa and Karnataka continued to remain suspended. The company said its Karnataka mine received clearance from the Supreme Court, and is now awaiting final statutory clearances in order to restart mining. We expect to resume mining at Karnataka in Q2, the company said.
Regarding the suspension of mining in Goa, the date for hearing is yet to be fixed by the Supreme Court. Earlier, the State Government and major miners, including Sesa, had filed their responses to the report submitted by the Central Empowered Committee. Separately, Sesa has filed an application to the Supreme Court for a modification or vacation of the Court's existing order on the suspension of mining and restrictions on ore transportation.
Production of pig iron and metallurgical coke were 179% and 32% higher at 109,536 tonnes and 84,610 tonnes, respectively in Q1 June 2013 over Q1 June 2012. Sales volume of pig iron and metallurgical coke were 180% and 57% higher at 126,579 tonnes and 83,316 tonnes in Q1 June 2013 over Q1 June 2012. Increase in the production and sales volume is due to the commissioning of new capacity of pig iron and metallurgical coke plant in Q2 September 2012. Power sales (including internal consumption) were 45 MU in Q1 June 2013 as compared to 30 MU in Q1 June 2012, an increase of 50% due to the commissioning of new 30 MW power plant.
The company said proposed merger of Sterlite Industries (India) and Sesa Goa and
Vedanta Group consolidation has received the approval of the High Court of Madras on 25 July 2013 and the approval of the High Court of Bombay at Goa on 3 April 2013. One of the shareholders of Sesa Goa has filed an appeal against the order passed by the High Court of Bombay at Goa before the Division Bench of the same court. The hearings before the Division Bench have been completed and the order is awaited.
Cement pivotals Ambuja Cements and ACC declined. Ambuja Cements lost 4.39%. ACC shed 1.14%.
Swiss cement major Holcim had on 24 July 2013 announced a major restructuring of its India operations -- currently, Holcim owns a little over 50% stake in its two cement subsidiaries in India viz. ACC and Ambuja Cements. The board of directors of Ambuja Cements on 24 July 2013 approved a proposal, wherein Ambuja will first acquire from Holderind Investments, Mauritius (Holcim), a 24% stake in Holcim India for a cash consideration of Rs 3500 crore, followed by a merger of Holcim India into Ambuja. The intra-group transaction will result in Ambuja holding 50.01% stake in ACC. The merger swap ratio proposed by two independent accounting firms and approved by Ambuja's board, is one Ambuja share for 7.4 Holcim India shares, translating into an implied swap ratio of 6.6 Ambuja shares for every ACC share, Ambuja said in a statement. Based on the approved merger ratio, Ambuja will issue 58.4 crore new equity shares of the company to Holcim, as consideration for the merger. Post the merger, the expanded capital base of Ambuja (post cancellation of the shares held by Holcim India in Ambuja and the issuance of new shares as aforesaid) will increase by 28%. Holcim will then own 61.39% of Ambuja and Ambuja in turn own 50.01% of ACC.
In addition, Ambuja's board also provided its approval for Ambuja to make commercially reasonable efforts to invest up to Rs 3000 crore to acquire an economic ownership in ACC of up to 10% without triggering a mandatory open offer.
Ambuja said that this restructuring exercise is expected to be EPS accretive from year one post completion of the transaction. There is synergy potential of about Rs 900 crore through supply chain and fixed cost optimization expected to be realised in a phased manner over two years post completion of the transaction.
Realty stocks edged lower. Realty major DLF dropped 2.01%. The company said on 25 July 2013 that it has signed definitive agreements to sell its 74% equity stake in its Life Insurance Joint Venture -- DLF Pramerica Life Insurance Company, a joint venture with Prudential International Insurance Holdings (PIIHL), a subsidiary of Prudential Financial, Inc USA to Dewan Housing Finance Corporation (DHFL) and its group entities. As these agreements are subject to regulatory approvals, hence the transaction consideration shall be disclosed post receipt of all such approvals, DLF said. The transaction is in line with the DLF's ongoing strategy to divest non-core assets.
Among other realty stocks, HDIL (down 6.14%), Unitech (down 4.46%), and Indiabulls Real Estate (down 5.27%), edged lower.
Prestige Estates Projects spurted 5.30% to Rs 130.10 ahead of the company's Q1 results today, 29 July 2013.
Bharti Infratel fell 2.36%. The company reported 68% rise in consolidated net profit to Rs 358 crore on 9% rise in revenue to Rs 2622 crore in Q1 June 2013 over Q1 June 2012. The result was announced during market hours today, 29 July 2013.
Shares of Jet Airways (India) surged for the second straight day on speculation that the Foreign Investment Promotion Board (FIPB) at its meeting scheduled today, 29 July 2013, may approve Jet's proposal to sell 24% stake to Etihad Airways. The stock was up 4.22%. The stock had jumped 17.43% on Friday, 26 July 2013. The FIPB last month deferred a decision on Jet's plan to sell a 24% stake to Etihad.
Shares of budget carrier, SpiceJet, jumped 8.75% on reports the company is in advanced negotiations for a stake sale to a foreign airline.
Kingfisher Airlines fell 2.98%.
Prime Minister Dr. Manmohan Singh will meet the captains of Indian industry today, 29 July 2013, to review steps to revive the economy. The discussion will cover measures to correct the Current Account Deficit, measures to revive industrial growth, depreciation of the rupee and its impact on trade and industry, skill development and ways of accelerating it and development of the Delhi-Mumbai Industrial Corridor (DMIC), the Chennai-Bangalore Industrial Corridor (CBIC), and the Amritsar-Delhi-Kolkata Industrial Corridor (ADKIC).
European stock markets edged higher on Monday, 29 July 2013, with shares of Danone SA on the rise after a well-received earnings report and Elan Corporation PLC rallying after a takeover deal. Key benchmark indices in Germany and France were up 0.32% to 0.34%. UK's FTSE 100 fell 0.11%.
Business sentiment in Italy rose sharply in July, reversing the previous month's strong decline, boosted by confidence in all sectors, national statistics institute Istat reported Monday. The composite business confidence index, which canvasses the service and construction sectors that rely more on domestic demand than exports, climbed to 79.4 in July from 76.4 in June, Istat said. June reading was revised up from the 76.1 released last month.
The European Central Bank (ECB) and the Bank of England (BoE) will announce their policy decisions on Thursday, 1 August 2013.
Asian stocks retreated on Monday, 29 July 2013, with Japanese equities skidding as a firm yen further dragged on the nation's exporters, while Chinese shares lost ground amid economic worries. Key benchmark indices in South Korea, Indonesia and Taiwan were off 0.57% to 1.68%. Singapore's Straits Times rose 0.03%.
Mainland Chinese and Hong Kong stocks retreated amid lingering economic worries, with sentiment weighed by official data released over the weekend showing profits at Chinese industrial firms slowed in June. The Shanghai Composite index lost 1.72%. In Hong Kong, the Hang Seng was off 0.54%. Data released over the weekend by the National Bureau of Statistics showed profits at industrial companies rose 6.3% in June from the year-earlier month, slowing sharply from a 15.5% increase in May, according to reports.
The drop in Chinese equities also came after Beijing ordered China's National Audit Office to conduct an urgent review of overall public debt.
In Japan, the Nikkei 225 Average lost 3.32%. The benchmark had retreated 3% on Friday, 26 July 2013.
Japanese retail sales rose 1.6% from a year earlier in June, figures today showed, which was below the market expectations.
Bank of Japan Governor Haruhiko Kuroda indicated little concern that a planned sales-tax rise would derail the nation's economic rebound. A two-step sales tax increase won't give major damage to growth in Japan's economy, Kuroda said in a speech today in Tokyo, referring to the BOJ's growth forecasts. We consider a downturn in overseas economies to be the largest risk factor to the outlook for economic activity and prices.
Trading in US index futures indicated that the Dow could fall 31 points at the opening bell on Monday, 29 July 2013. US stocks inched higher on Friday, 26 July 2013, to end the week virtually flat, as investors digested earnings reports and prepared for a busy economic calendar in the week ahead.
On the economic front, US consumer confidence unexpectedly rose at the end of this month, according to the Thomson-Reuters/University of Michigan's consumer-sentiment index.
The Federal Open Market Committee (FOMC) holds a two-day policy meeting on Tuesday (30 July 2013) and Wednesday (31 July 2013), after which it will release a statement on central bank policy. In his two-day testimony to Congress, which concluded on 18 July 2013, Federal Reserve Chairman Ben Bernanke said plans to taper asset purchases were not on a preset path and stressed intentions to be very responsive to data. Additionally, Bernanke said recent data have been "mixed" and it was "way too early" to make a judgment on when the central bank will slow down the pace of its asset purchases. The Fed currently buys $85 billion a month in government and mortgage bonds in an effort to keep interest rates low and stimulate economic growth.
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