Key indices surged as a weak reading on US June retail sales fueled speculation that the US Federal Reserve may delay interest rate hike in the world's biggest economy. There had been concerns that higher interest rates in the United States will boost returns on US debt and bank deposits, drawing money back from riskier markets. Another trigger for the latest rally for the key equity indices in India was expectations that Greece's Parliament will approve a rescue deal for the country later in the global day today, 15 July 2015. In overseas markets, European shares reversed their initial losses on expectations Greece's Parliament will approve a rescue deal for the country. The barometer index, the S&P BSE Sensex, reclaimed the psychological 28,000 mark. The Sensex was provisionally up 265.39 points or 0.95% at 28,198.29. The gains for the Sensex in percentage terms were higher than those for the 50-unit CNX Nifty. The Nifty was provisionally up 69.70 points or 0.82% at 8,523.80.
Zee Entertainment Enterprises edged higher in volatile trade after reporting Q1 June 2015 results. IT stocks advanced. Auto stocks also edged higher. Shares of small car major Maruti Suzuki India scaled record high on reports that a foreign brokerage has maintained its outperform rating on the stock.
Earlier, the Sensex and the Nifty, both, hit their highest level in more than a week in early afternoon trade as these two key benchmark indices extended intraday gains.
Key indices remained in positive zone throughout the trading session today, 15 July 2015.
Meanwhile, Prime Minister Narendra Modi today, 15 July 2015, said that the political deadlock over land acquisition is seriously impacting rural development, including the creation of schools, hospitals, roads and irrigation projects.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 269.90 crore yesterday, 14 July 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) sold shares worth a net Rs 130.90 crore yesterday, 14 July 2015, as per provisional data released by the stock exchanges.
In overseas markets, European stocks reversed their initial losses on expectations Greece's Parliament will approve a rescue deal for the country. Asian stocks ended on a mixed note. US stocks edged higher yesterday, 14 July 2015, as investors took stock of disappointing June retail sales numbers and how the data factor into the Federal Reserve's plans for a rate hike.
As per provisional figures, the S&P BSE Sensex was up 265.39 points or 0.95% at 28,198.29. The index jumped 285.47 points at the day's high of 28,218.37 in early afternoon trade, its highest level since 7 July 2015. The index rose 53.58 points at the day's low of 27,986.48 in early trade.
The CNX Nifty was up 69.70 points or 0.82% at 8,523.80, as per provisional figures. The index hit a high of 8,531.40 in intraday trade, its highest level since 7 July 2015. The index hit a low of 8,462.95 in intraday trade.
The market breadth indicating the overall health of the market was positive. On BSE, 1,538 shares gained and 1,283 shares fell. A total of 142 shares were unchanged.
The BSE Mid-Cap index was up 9.19 points or 0.08% at 11,051.66. The BSE Small-Cap index was up 56.77 points or 0.49% at 11,578.69. Both these indices underperformed the Sensex.
The total turnover on BSE amounted to Rs 2737 crore, lower than turnover of Rs 2908.95 crore registered during the previous trading session.
Zee Entertainment Enterprises edged higher in volatile trade after reporting Q1 June 2015 results. The stock was up 0.36% at Rs 376. The stock hit high of Rs 385.70 and low of Rs 373.50. The company's consolidated net profit rose 15.76% to Rs 243.76 crore on 28.68% rise in total income to Rs 1407.84 crore in Q1 June 2015 over Q1 June 2014. The company announced Q1 results during market hours.
Zee's earnings before interest, taxation, depreciation and amortization (EBITDA) rose 0.7% to Rs 311.20 crore in Q1 June 2015 over Q1 June 2014. The EBITDA margin fell sharply to 23.22% in Q1 June 2015 from 29.29% in Q1 June 2014.
At the board meeting held today, 15 July 2015, the board has approved in-principle acquisition of 100% equity stake in Sarthak Entertainment, an entity which owns and operates a leading Odia language general entertainment channel SARTHAK. The acquisition shall be from current shareholders of Sarthak Entertainment, subject to requisite regulatory approvals, as an all-cash deal at a consideration of maximum of Rs 115 crore, including Rs 15 crore payable in financial year 2017 and 2018, linked to certain performance milestones of the channel.
IT stocks edged higher on renewed buying. Tech Mahindra (up 0.67%), Oracle Financial Services Software (up 0.3%), Infosys (up 1.12%), TCS (up 1.74%) and Wipro (up 1.89%) edged higher. HCL Technologies declined 0.67%.
Auto stocks edged higher on renewed buying. Eicher Motors (up 0.06%), Tata Motors (up 2.2%), Mahindra & Mahindra (M&M) (up 1.43%), Ashok Leyland (up 0.2%), Bajaj Auto (up 1.12%), Hero MotoCorp (up 1.13%) and TVS Motor Company (up 0.66%) rose.
Shares of small car major Maruti Suzuki India rose 2.75% to Rs 4,160 on reports that a foreign brokerage has maintained its outperform rating on the stock. The stock hit a high of Rs 4,182 in intraday trade, which is a record high for the counter. The stock hit a low of Rs 4,070 in intraday trade. The foreign brokerage reportedly said that higher volumes should continue to drive upgrades for Maruti Suzuki India. The brokerage added that the sixth pay commission had a big impact on Maruti's volumes and the seventh pay commission could boost industry demand by 10%. Increase in foreign institutional investment (FII) limit could be another trigger for the upmove in the stock, the brokerage added.
Meanwhile, Prime Minister Narendra Modi today, 15 July 2015, said that the political deadlock over land acquisition is seriously impacting rural development, including the creation of schools, hospitals, roads and irrigation projects. The Prime Minister chaired the Second Meeting of the Governing Council of NITI Aayog in New Delhi today, 15 July 2015. The Council held consultations on the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act. In his opening remarks at the Second Meeting of the Governing Council of NITI Aayog, Modi reiterated that as far as paying enhanced compensation is concerned, there are no differences in the stands of the Centre and States.
The Prime Minister said that after formation of his government at the Centre, several state governments had raised concerns with regard to the implementation of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. He said many state governments had felt that development work was suffering due to the provisions of the 2013 Act; and some Chief Ministers had requested for changes in the Act, and sent letters to this effect. The Prime Minister said that the Ordinance was brought about in response to these development concerns of the states and also to ensure that farmers continue to receive their legitimate due. The Prime Minister appealed to everyone that political considerations should not come in the way of a solution that would facilitate development of the rural areas and greater prosperity for the farmers. He said the matter is now before the Parliamentary Standing Committee, and therefore, ahead of the upcoming Parliament session, it was appropriate that the suggestions of state governments be listened to, once again.
Finance Minister Arun Jaitley said today, 15 April 2015, that a consensus was needed quickly to pass a business-friendly land reform law, or else a legislative deadlock would have to be broken by allowing state governments to pass their own measures.
Meanwhile, India's weather office, the India Meteorological Department (IMD), said in its daily monsoon update issued yesterday, 14 July 2015, that the Southwest Monsoon was active over Andaman & Nicobar Island during 24 hours ending until 8:30 IST.
For the country as a whole, cumulative rainfall during this year's monsoon season was 5% below the Long Period Average (LPA) until 14 July 2015. Region wise, the southwest monsoon was 20% above the LPA in Northwest India, 8% below the LPA in East & Northeast India, 11% below the LPA in Central India and 14% below the LPA in South Peninsula and until 14 July 2015.
The quantum of and the spatial distribution of rainfall this month holds key, with July being a crucial month for the sowing of Kharif crops. 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 reversed their initial losses today, 15 July 2015, on expectations Greece's Parliament will approve a rescue deal for the country. Key indices in UK and Germany were up 0.05% to 0.08%. France's CAC 40 was flat. In Spain, the IBEX 35 index was up 0.23%. In Italy, the FTSE MIB index was up 0.39%.
Greece is back in focus as Greece's parliament faces a deadline today, 15 July 2015, to approve creditors' austerity measures or risk losing much-needed bailout aid. Early this week, eurozone leaders agreed on a three-year bailout for the debt-laden country. The measures call for more severe spending cuts, market reforms and tax increases than those rejected by Greek voters in a referendum on 5 July 2015. Accepting the measures is necessary to begin negotiations on a desperately needed bailout. Rejecting them could possibly lead to a Greek exit from the eurozone and more intense economic pain in the short term.
The International Monetary Fund (IMF) criticized Greece's bail out deal in a report published yesterday, 14 July 2015, questioning Greece's ability to implement the tough fiscal measures involved. It warned the eurozone must commit to debt restructuring in order for the bailout program to work. If the currency union fails to assure the IMF it will reduce Greece's debt burden to sustainable levels, the fund signaled it may consider withdrawing from the program.
Greece also faces an immediate cash crisis. The country's banks have been shut since 29 June 2015.
Meanwhile, in France, the latest data showed that the consumer price index declined 0.1% in June from May. On year, the index was 0.3% higher.
Asian stocks ended on a mixed note today, 15 July 2015. Key benchmark indices in Taiwan, Singapore, Japan, and South Korea rose 0.14% to 0.67%. Indonesia's Jakarta Composite fell 0.65%.
Stocks fell sharply in mainland China as surprisingly strong GDP growth data diminished hopes for more stimulus. The Shanghai Composite lost 3.03%. In Hong Kong, the Hang Seng index lost 0.26%. The continued slide among Chinese stocks reflects deepening doubts that Beijing can turn things around, despite heavy intervention in recent days. China's economy grew an annual 7% in the second quarter, data released by the National Bureau of Statistics today, 15 July 2015, showed. Other statistics released by the National Bureau of Statistics showed little sign of turnaround in a quarter that started against the backdrop of a broad stock rally and ended under the shadow of that rally's collapse. Value-added industrial production grew 6.3% year-over-year in the first half, down from the 6.4% growth in the first quarter, while growth in fixed-asset investment fell to 11.4% from 13.5%, and retail-sales gains slowed to 10.4% from 10.6%, the statistics bureau said.
In Japan, the Bank of Japan trimmed its forecasts for inflation and economic growth, but kept the scope of its monetary easing unchanged as widely expected after a monetary policy review today, 15 July 2015. The central bank said the current fiscal year, ending in March 2016, would see the core consumer price index rise 0.7%, down from its April forecast for a gain of 0.8%. Likewise, it said the economy would grow by 1.7%, down from a previous projection of 2%. The Bank of Japan also cut its core CPI forecasts for fiscal 2016 and 2017, but kept its growth estimates for those years unchanged.
US stocks rose yesterday, 14 July 2015, as investors took stock of disappointing June retail sales numbers and how the data factor into the Federal Reserve's plans for a rate hike. US retail sales unexpectedly fell 0.3% in June from the prior month, the Commerce Department said. Figures for the prior two months were also revised down. Weaker economic growth may delay the first rate hikes as the Federal Reserve tries to find a balance between normalizing rates and accommodating an uneven recovery.
Federal Reserve Chairwoman Janet Yellen's address to lawmakers this week may give clues on the timing of an interest-rate increase in the United States. Yellen is scheduled to speak about the central bank's economic outlook to the House Financial Services committee today, 15 July 2015. Yellen will address the Senate Banking Committee tomorrow, 16 July 2015.
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