After a steep slide yesterday, 12 May 2015, key benchmark indices logged strong gains today, 13 May 2015 amid high intraday volatility. The barometer index, the S&P BSE Sensex settled above the psychological 27,000 mark after moving above and below that mark. The Sensex rose 373.62 points or 1.39% to settle at 27,251.10. The market breadth indicating the overall health of the market was strong. The BSE Mid-Cap index rose 1.56%, outperforming the Sensex. Market sentiment was boosted by expectations of an interest rate cut by the Reserve Bank of India after the latest government data showed easing of inflation based on consumer price index (CPI) to a four-month low in April. Firmness in global stocks also supported gains on domestic bourses.
Index heavyweight and housing finance major HDFC edged higher. Interest rate sensitive bank stocks gained after latest government data showed easing of inflation based on consumer price index (CPI) to a four-month low in April raised expectations of interest rate cut by the Reserve Bank of India. Mahindra & Mahindra (M&M) advanced on reports the company is planning to launch a new variant of its sports utility vehicle XUV500. Lupin declined after poor Q4 results. Many metal and mining stocks rose. Shares of power generation and power distribution companies gained.
Earlier during the day, key indices regained strength after the barometer index, the S&P BSE Sensex and the 50-unit CNX Nifty, both, hit almost one week low in mid-morning trade after a firm opening.
Foreign portfolio investors sold shares worth a net Rs 1340.99 crore into secondary equity market yesterday, 12 May 2015, as per data from Central Depository Services (India). Domestic institutional investors (DIIs) bought shares worth a net Rs 1331.93 crore yesterday, 12 May 2015, as per provisional data.
Brent crude extended gains after yesterday's strong gains, supported by bets that US crude stockpiles will fall for a second straight week as production slows.
In overseas markets, European stocks edged higher today, 13 May 2015. Asian stocks edged higher today, 13 May 2015 despite a flurry of economic indicators from China coming in just shy of expectations. US stocks declined for a second straight session yesterday, 12 May 2015 though losses were modest after indices recovered from a bout of selling linked to fluctuations in treasury yields.
The S&P BSE Sensex rose 373.62 points or 1.39% to settle at 27,251.10, its highest closing level since 11 May 2015. The index jumped 422.32 points at the day's high of 27,299.80 in morning trade. The index lost 127.47 points at the day's low of 26,750.01 in mid-morning trade, its lowest level since 7 May 2015.
The CNX Nifty gained 108.50 points or 1.34% to settle at 8,235.45, its highest closing level since 11 May 2015. The index hit a high of 8,254.95 in intraday trade. The index hit a low of 8,089.80 in intraday trade, its lowest level since 7 May 2015.
The BSE Mid-Cap index rose 159.79 points or 1.56% to settle at 10,433.87, outperforming the Sensex. The BSE Small-Cap index advanced 94.15 points or 0.87% to settle at 10,872.85, underperforming the Sensex.
Among the sectoral indices on BSE, the S&P BSE Auto index (up 1.72%), BSE Bankex index (up 2.64%) and BSE Capital Goods index (up 1.81%) outperformed the Sensex. The S&P BSE FMCG index (up 1.12%), BSE Healthcare index (up 0.44%), BSE IT index (up 0.53%), BSE Consumer Durables index (up 1.03%), BSE Metal index (up 0.13%), BSE Oil & Gas index (up 1.27%), BSE Power index (up 1.29%), BSE Realty index (down 0.34%) and BSE Teck index (up 0.29%) underperformed the Sensex.
The market breadth indicating the overall health of the market was strong. On BSE, 1,639 shares gained and 1,059 shares fell. A total of 118 shares were unchanged.
The total turnover on BSE amounted to Rs 3535 crore, higher than turnover of Rs 3142.70 crore registered during the previous trading session.
Index heavyweight and housing finance major HDFC rose 2.33% to Rs 1,219. The stock hit high of Rs 1,227 and low of Rs 1,189.
Interest rate sensitive bank stocks gained after latest government data showed easing of inflation based on consumer price index (CPI) to a four-month low in April raised expectations of interest rate cut by the Reserve Bank of India.
Among private bank stocks, HDFC Bank (up 1.88%), IndusInd Bank (up 2.36%), Kotak Mahindra Bank (up 1.52%), Axis Bank (up 4.74%), Yes Bank (up 2.24%), and ICICI Bank (up 3.22%) gained.
Among PSU bank stocks, State Bank of India (SBI) (up 2.52%), Punjab National Bank (up 1.5%), Bank of Baroda (up 2.27%), Canara Bank (up 2.81%), Bank of India (up 2.55%) and Union Bank of India (up 7.35%) gained.
Mahindra & Mahindra (M&M) advanced on reports the company is planning to launch a new variant of its sports utility vehicle XUV500. The stock was up 2.44%.
Lupin lost 3.67% after consolidated net profit fell 1.08% to Rs 547 crore on 0.08% growth in net sales to Rs 3054 crore in Q4 March 2015 over Q4 March 2014. The Q4 result was announced during market hours today, 13 May 2015.
Lupin's EBITDA (earnings before interest, taxation, depreciation, and amortization) declined 8.57% to Rs 806.50 crore in Q4 March 2015 over Q4 March 2014.
Commenting on the company's financial performance, Managing Director of Lupin. Nilesh Gupta said that higher price erosion in the US as well as a slowdown in product approvals impacted growth in the quarter, but overall the company has done well to improve gross margins and enhance profitability for the year. Lupin continues to ramp up investment in research in segments like inhalation, complex injectables and biosimilars, Gupta said. Lupin's execution strength, pipeline evolution and planned M&A will drive the company's future as a global generic and specialty pharmaceutical company, Gupta added.
Many metal and mining stocks rose. Bhushan Steel (up 1.18%), Hindustan Zinc (up 2.42%), Jindal Steel & Power (up 3.69%), JSW Steel (up 0.84%), Tata Steel (up 1.81%), NMDC (up 1.73%) and Hindustan Copper (up 1.93%) rose.
Steel Authority of India (Sail) (down 0.15%), Vedanta (down 0.23%) and National Aluminium Company (down 1.49%) edged lower.
Hindalco Industries fell 2.91% after its overseas subsidiary Novelis reported weak earnings in Q4 March 2015 yesterday, 12 May 2015. Novelis yesterday, 12 May 2015, reported 46.30% decline in net income to $29 million on 12% increase in net sales to $2.8 billion in Q4 March 2015 over Q4 March 2014.
Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) for the fourth quarter of fiscal 2015 was $201 million compared to the $250 million reported for the same period a year ago. While automotive shipments ramped up as expected, the positive benefits from product mix shift were more than offset by unfavorable foreign exchange, falling local market metal premiums in the fourth quarter of fiscal 2015 compared to rising premiums in the fourth quarter of fiscal 2014, and an unexpected North American hot mill outage early in the fourth quarter of fiscal 2015.
Shares of power generation and power distribution companies gained. Torrent Power (up 4.37%), NHPC (up 0.26%), Tata Power Company (up 2.24%), Adani Power (up 1.73%), Power Grid Corporation of India (up 0.79%), Reliance Infrastructure (up 5.11%) and Reliance Power (up 2.19%) gained.
NTPC lost 2.47%. Indian Oil Corporation (IOC) rose 0.5%. As per reports, the Cabinet Committee on Economic Affairs at a meeting held today, 13 May 2015, approved government's 5% divestment in NTPC and 10% stake sale in IOC.
The Government of India (GoI) held 74.96% stake in NTPC and 68.57% in Indian Oil Corporation (as per the shareholding pattern as on 31 March 2015).
The Sensex has risen 239.79 points or 0.88% in this month so far (till 13 May 2015). The Sensex has dropped 248.32 points or 0.9% in this calendar year so far (till 13 May 2015). From a 52-week low of 23,008.65 on 12 May 2014, the Sensex has risen 4,242.45 points or 18.43%. The Sensex is off 2,773.64 points or 9.23% from a record high of 30,024.74 hit on 4 March 2015.
Brent crude extended gains after yesterday's strong gains, supported by bets that US crude stockpiles will fall for a second straight week as production slows. Brent for June settlement was up 33 cents at $67.19 a barrel. The contract had gained $1.95 a barrel or 3% to settle at $66.86 a barrel during previous trading session.
Data released by government after market hours yesterday, 12 May 2015 showed that industrial output growth touched a five-month low of 2.1% in March from a revised 4.9% in February on the back of an across-the-board slowdown in production. Consumer price index-based retail inflation eased to a four-month low of 4.87% in April from a revised 5.25% in March as prices of food items, vegetables and fruits turned cheaper.
The government will unveil data on inflation based on the wholesale price index (WPI) for April 2015 tomorrow, 14 May 2015. The WPI based inflation dipped to minus 2.3% in March 2015 compared with minus 2.1% in February 2015.
Prime Minister Narendra Modi's three nation official visit to China, Mongolia and Republic of Korea begins tomorrow, 14 May and ends on 19 May 2015. In China, Prime Minister will visit Xian, Beijing and Shanghai from 14 May to 16 May 2015. He will hold bilateral meetings with China's leadership and participate in cultural and business events. PM will attend an event organized by the Indian community in China. Prime Minister's official engagements in Mongolia will be on 17 May 2015. This is the first ever visit by a Prime Minister of India to Mongolia. Prime Minister's visit to Republic of Korea will be on 18 May to 19 May 2015. PM will hold bilateral discussions with President Park Geun-hye and meet with important business leaders in Seoul.
Meanwhile, proceedings in parliament are being keenly watched. As per reports, the government, under pressure from the opposition, was forced to defer its plans to legislate land acquisition and goods and services tax (GST) laws. The government has reportedly referred the Land Acquisition Bill, which was introduced in Lok Sabha on 11 May 2015 to a joint committee of both Lok Sabha and Rajya Sabha. The GST Bill, passed by the Lok Sabha last week, will be reportedly sent to a select committee of the Rajya Sabha. Both these panels are expected to submit their reports in the next session, reports indicated. Besides the Land Acquisition Bill and the GST Bill, a united Opposition had last week forced the government to refer another Bill related to regulating the real estate sector to a Select Committee of the Rajya Sabha. The only hope for the three Bills will now be in the monsoon session of Parliament in July 2015 as the budget session ends today, 13 May 2015.
The amended Land Acquisition Bill seeks to scrap the consent clause for acquiring land for five sectors industrial corridors, public private partnership projects, rural infrastructure, affordable housing and defence. The bill also exempts projects in these five areas from social impact assessments and allows the purchase of irrigated multi-cropped land and other types of agricultural land.
The Lok Sabha on 6 May 2015, passed the Constitution Amendment Bill in respect of goods and services tax (GST). A constitutional amendment bill needs to be approved by a two-thirds majority in both houses of Parliament and ratified by half the state legislative assemblies before coming into effect. While the Bharatiya Janata Party-led National Democratic Alliance found it easy to pass the GST bill in the Lok Sabha where it is in a majority, the real test will come in the Rajya Sabha where the ruling alliance is in a minority, with 62 members in a 245-member house.
GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. Central taxes like Central Excise Duty, Additional Excise Duties, Service Tax, Additional Customs Duty (CVD) and Special Additional Duty of Customs (SAD), etc. will be subsumed in GST. At the state level, taxes like VAT/Sales Tax, Central Sales Tax, Entertainment Tax, Octroi and Entry Tax, Purchase Tax and Luxury Tax, etc. would be subsumed in GST.
In overseas markets, European stocks edged higher today, 13 May 2015. Key indices in France, Germany and UK rose by 0.62% to 1.27%.
The Bank of England cut its growth forecasts for the UK economy today, 13 May 2015, but signaled it remains on course to lift its benchmark interest rate from its historic low in the middle of next year. The BOE said in its quarterly inflation report that it expects the UK economy will expand 2.5% in 2015 and 2.6% in 2016, compared with its February forecasts for growth of 2.9% this year and next. The central bank said the weaker outlook reflects factors including the recent strength of the pound, a sluggish housing market and poor productivity.
A return to expansion in France and Italy helped boost eurozone economic growth in the first three months of 2015 to its fastest pace in almost two years, broadening a modest revival that had previously been heavily reliant on Germany. The combined gross domestic product of the 19 countries that shared the euro was 0.4% higher in the first quarter of 2015 than in the final three months of 2014, the European Union's statistics agency said today, 13 May 2015. That marked a pickup from the 0.3% growth recorded in the final quarter of last year.
Meanwhile, Greek Prime Minister Alexis Tsipras yesterday, 12 May 2015 called on lenders to break an impasse in cash-for-reform talks after Athens had to resort to a temporary expedient to make a crucial payment to the IMF.
Asian stocks edged higher today, 13 May 2015 despite a flurry of economic indicators from China coming in just shy of expectations. Key benchmark indices in Singapore, Taiwan, Japan, Indonesia and South Korea rose by 0.31% to 0.83%. Key benchmark indices in China and Hong Kong fell 0.58% each.
Value-added industrial output in China rose 5.9% in April from a year earlier, accelerating from 5.6% growth in March, data from the National Bureau of Statistics showed today, 13 May 2015. Industrial output also increased 0.57% in April from March, when output rose 0.25% from February.
Fixed-asset investment in non-rural areas of China climbed 12% on-year in the January-April period, compared with an increase of 13.5% for the first three months of the year.
Retail sales grew 10% in April from a year earlier, slowing a tad from a 10.2% increase in March.
US stocks declined for a second straight session yesterday, 12 May 2015 though losses were modest after indices recovered from a bout of selling linked to fluctuations in treasury yields.
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