Amid a divergent trend among various index constituents, key benchmark indices eked out minuscule gains. High volatility was witnessed during the second half of the trading session as key indices alternately swung between positive and negative zone. The barometer index, the S&P BSE Sensex, regained the psychological 29,000 mark. The index settled just a tad above the psychological 29,000 mark after alternately moving above and below that level in intraday trade. The Sensex rose 29.55 points or 0.10% to settle at 29,004.66. The market breadth indicating the overall health of the market was weak. The BSE Small-Cap and Mid-Cap indices, both, edged lower.
Meanwhile, the BJP has reportedly formed committee to seek farmers' suggestion on land acquisition bill after the government introduced the land acquisition amendment bill in the Lok Sabha today, 24 February 2015, amid uproar by the Opposition. Meanwhile, the Prime Minister's Office (PMO) today, 24 February 2015, said that Prime Minister Narendra Modi has written to Chief Ministers, informing them of the central government's decision to wholeheartedly accept the recommendations of the 14th Finance Commission.
Index heavyweight and cigarette major ITC rose after the company market hours yesterday, 23 February 2015, said it has been declared as the successful bidder for Park Hyatt Hotel located at Cansaulim in Goa along with land and built up area of the hotel together with all buildings and structures and plant & machineries. Shares of FMCG major Hindustan Unilever (HUL) edged higher. Shares of oil exploration & production firms declined as global crude oil prices dropped. Shares of public sector oil marketing companies gained on slide in international crude oil prices.
Key indices snapped a two-day losing streak today, 24 February 2015.
Foreign institutional investors (FPIs) bought shares worth a net Rs 745.61 crore from the secondary equity markets yesterday, 23 February 2015, as per data released by Central Depository Services (India). Domestic institutional investors (DIIs) sold shares worth a net Rs 163.79 crore yesterday, 23 February 2015, as per provisional data released by the stock exchanges.
The market may remain volatile this week as traders roll over positions in the futures & options (F&O) segment from the near month February 2015 series to March 2015 series. The near month February 2015 derivatives contracts expire on Thursday, 26 February 2015.
In the foreign exchange market, the rupee edged higher against the dollar in volatile trade.
Brent crude oil futures edged lower in choppy trade amid oil supply glut.
In overseas markets, European stocks dropped as investors waited for European officials to respond to economic-reform proposals submitted by Greece. Asian stocks edged higher ahead of US Federal Reserve Chairwoman Janet Yellen's testimony before the Senate Banking Committee which begins later in the global day. Most US stocks edged lower in choppy trading session yesterday, 23 February 2015, as crude oil prices dropped.
The S&P BSE Sensex rose 29.55 points or 0.10% to settle at 29,004.66, its highest closing level since 20 February 2015. The index jumped 155.56 points at the day's high of 29,130.67 in mid-afternoon trade. The index fell 99.17 points at the day's low of 28,875.94 in late trade, its lowest level since 13 February 2015.
The CNX Nifty rose 7.15 points or 0.08% to settle at 8,762.10, its highest closing level since 20 February 2015. The index hit a high of 8,800.50 in intraday trade. The index hit a low of 8,726.75 in intraday trade, its lowest level since 12 February 2015.
The market breadth indicating the overall health of the market was weak. On BSE, shares 1,742 declined and 1,134 shares gained. A total of 112 shares were unchanged.
The BSE Mid-Cap index fell 20.72 points or 0.19% to settle at 10,724.70. The BSE Small-Cap index fell 89.37 points or 0.78% to settle at 11,300.11. Both these indices underperformed the Sensex.
The total turnover on BSE amounted to Rs 3525 crore, lower than turnover of Rs 3570.52 crore during the previous trading session.
Among the sectoral indices on BSE, the S&P BSE FMCG index (up 1.45%), the S&P BSE Capital Goods index (up 1.09%), the S&P BSE Realty index (up 0.56%), the S&P BSE IT index (up 0.37%), the S&P BSE Teck index (up 0.23%) and the S&P BSE Healthcare index (up 0.11%), outperformed the Sensex. The S&P BSE Consumer Durables index (up 0.03%) and the S&P BSE Power index (up 0.02%). The S&P BSE Bankex (down 0.10%), the S&P BSE Auto index (down 0.30%), the S&P BSE Metal index (down 1.10%) and the S&P BSE Oil & Gas index (down 1.15%), underperformed the Sensex.
Realty shares were mostly higher. Parsvnath Developers (up 4.07%), Unitech (up 3.39%), D B Realty (up 2.26%), Housing Development and Infrastructure (HDIL) (up 2%), Prestige Estates (up 1.51%), Sunteck Realty (up 0.64%), Peninsula Land (up 0.59%), Godrej Properties (up 0.40%), DLF (up 0.24%), Sobha (up 0.21%) and Phoenix Mills (up 0.20%), edged higher. Anant Raj (down 0.31%), Indiabulls Real Estate (down 0.55%) and Oberoi Realty (down 2.68%), edged lower.
Minister of Corporate Affairs Arun Jaitley stated in a written reply to a question in the Rajya Sabha today, 24 February 2015, that the Competition Commission of India (CCI) is looking into various aspects of alleged unfair business practices in realty sector. As on 11 February 2015, CCI has dealt with 132 cases of alleged anti-competitive practices/abuse of dominance in realty sector. Out of this, 93 cases have been closed at prima-facie stage and 3 cases have been disposed of after considering the report of Director General (DG), CCI. In 13 cases, CCI has passed 'cease and desist orders' and in one case has imposed penalty of Rs 630 crore on DLF in addition to passing a cease and desist order.
Under the provisions of the Competition Act, 2002, either on its own motion or on receipt of any information, CCI looks into cases of alleged anti-competitive practices/abuse of dominance including in realty sector.
Telecom stocks declined. Bharti Airtel (down 1.01%), Idea Cellular (down 1.94%), MTNL (down 1.53%), Reliance Communications (down 2.14%) and Tata Teleservices (Maharashtra) (down 1.46%), edged lower.
The Telecom Regulatory Authority of India (TRAI) today, 24 February 2015, issued the "Telecommunication Interconnection Usage Charges (Twelfth Amendment) Regulations" which prescribe a revised domestic carriage charge. On the basis of comments received from stakeholders and based on internal analysis, TRAI has reduced the ceiling of the domestic carriage charge to 35 paise per minute from the existing 65 paise per minute effective from 1st March, 2015.
Meanwhile, TRAI in a notification yesterday, 23 February 2015, slashed domestic and international termination call charges. Mobile termination charge (MTC) for all calls originating from wireless network has been reduced from 20 paise per minute to 14 paise per minute. Further, to promote investment and adoption of wireline network (so that they become an effective vehicle for delivery of high speed internet in the country), TRAI has decided to prescribe fixed termination charges (FTC) as well as MTC for wireline to wireless calls as zero. Termination charge for international incoming calls has been increased to 53 paisa per minute from existing 40 paisa per minute.
Shares of companies whose fortunes are linked to orders from Indian railways edged lower. Kalindee Rail Nirman (down 12.62%), Titagarh Wagons (down 9.99%), Texmaco Rail & Engineering (down 9.21%), Stone India (down 7.71%), Kernex Microsystems (down 4.95%), Hind Rectifiers (down 4.81%), Zicom Electronic Security Systems (down 2.75%), Transformers & Rectifiers (India) (down 2.23%), NELCO (down 0.34%) and BEML (down 0.3%), edged lower. Simplex Casting (up 0.42%) edged higher.
The Railway Budget 2015-16 will be tabled in the parliament by the rail minister Suresh Prabhu on Thursday, 26 February 2015. This will be the first full railway budget of the Narendra Modi government and hopes are already running high that the document will contain innovative and out-of-the-box plans to turnaround railways and modernise the network and its supporting infrastructure.
Container Corporation of India dropped 1.34% to Rs 1,575.50. The stock turned ex-dividend today, 24 February 2015, for an interim dividend of Rs 8 per share for the year ending March 2015.
Index heavyweight and cigarette major ITC rose 1.46% to Rs 395.85. ITC after market hours yesterday, 23 February 2015, said it has been declared as the successful bidder for Park Hyatt Hotel located at Cansaulim in Goa along with land and built up area of the hotel together with all buildings and structures and plant & machineries. The aforesaid assets of Blue Coast Hotels were put up on sale by IFCI through public auction under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, ITC said in a statement. IFCI has declared ITC as the successful bidder at the bid price of Rs 515.44 crore and ITC has remitted 25% of bid amount being Rs 128.86 crore as per the terms of the Tender Document. Further, ITC has been advised to remit 75% of the balance amount within 15 days for the confirmation of sale, IFCI said.
Shares of IFCI rose 0.81%.
FMCG major Hindustan Unilever advanced 3.15% to Rs 913.95. The stock hit high of Rs 915 and low of Rs 887.
Shares of oil exploration & production firms declined on fall in international crude oil prices. Reliance Industries (RIL) (down 1.10%), Oil India (down 3.50%) and Cairn India (down 3.45%) dropped. Decline in crude oil prices would result in lower realizations from crude sales for oil exploration firms.
Oil & Natural Gas Corporation (ONGC) dropped 2.98%. ONGC during market hours today, 24 February 2015, said that the company has been informed by the Ministry of Petroleum & Natural Gas, Government of India, vide order dated 23 February 2015 that a Disciplinary proceeding against Shashi Shankar, Director (T&FS), ONGC is contemplated. The competent authority in exercise of the powers conferred under ONGC Conduct, Discipline and Appeal Rules, 1994, has placed Shashi Shankar, Director (T&FS) ONGC, under suspension with immediate effect.
Shares of public sector oil marketing companies rose on fall in international crude oil prices. BPCL (up 2.64%) and HPCL (up 2.06%) rose. Indian Oil Corporation fell 2.69%.
Decline in crude oil prices could reduce under-recoveries of PSU OMCs on domestic sale of LPG and kerosene at government controlled prices. The government has already decontrolled pricing of petrol and diesel.
Shares of most PSU banks declined after the bank employees' unions and bank managements, under the aegis of the Indian Banks' Association (IBA), at a meeting held yesterday, 23 February 2015, agreed 15% wage hike as part of an industry-wide wage settlement.
Bank of Baroda (down 2.88%), Allahabad Bank (down 2.52%), Indian Bank (down 2.02%), Andhra Bank (down 1.5%), Bank of India (down 1.13%), Punjab National Bank (down 1.13%), Corporation Bank (down 1.03%), United Bank of India (down 0.81%), Punjab and Sind Bank (down 0.55%) and Bank of Maharashtra (down 0.38%), edged lower. Vijaya Bank (up 0.10%), Syndicate Bank (up 0.21%), Dena Bank (up 0.27%), Union Bank of India (up 0.31%), Canara Bank (up 0.68%), UCO Bank (up 0.92%) and Central Bank of India (up 8.11%), edged higher.
According to reports, the proposed hike in salaries will amount to a collective outgo of Rs 4725 crore per year for the 45 banks that are part of the 10th industry-wide bipartite five-year wage (2012-2017) settlement exercise. The revision in wages would be effective retrospectively from November 2012. Following the agreement, the employees' unions have called off the four-day strike, which was supposed to start tomorrow, 25 February 2015.
State Bank of India (SBI) declined 0.03% to Rs 296.15. The Ministry of Defence after trading hours yesterday, 23 February 2015, said a Memorandum of Understanding (MoU) was signed between the Indian Army and State Bank of India (SBI) on the Defence Salary Package. The basic features of the MoU include a number of free/concessional services like free drafts, free cheque books, free funds transfers to any bank in India through RTGS/NEFT, free ATM cards etc. The provision also includes the Nepal Express Remittance Scheme which enables instant fund transfers to Nepal for the benefit of the Nepali Domicile Gorkha Soldiers serving in the Indian Army. Additional improved features are linking of the Personal Accident Insurance (PAI) to the savings account instead of the debit card, enhancement of the PAI amounts, enhancement of the exemption percentage of margin money for house and car loans and waiving off of the processing charges on the loans. The revised MoU will benefit almost 19.5 lakh pensioners and 10 lakh serving personnel who hold Pay or Pension accounts with SBI and also provide them an opportunity to access modern banking facilities, the Ministry of Defence said in a statement.
Shares of private sector banks were mixed. Among private bank stocks, Yes Bank (down 1.4%), IndusInd Bank (down 1.31%), ICICI Bank (down 0.94%) and Federal Bank (down 0.84%), edged lower. HDFC Bank (up 0.04%), Axis Bank (up 0.38%) and City Union Bank (up 1.27%), edged higher.
Kotak Mahindra Bank rose 2.79%. ING Vysya Bank rose 1.43%. The Reserve Bank of India yesterday, 23 February 2015, notified that the foreign shareholding through Global Depository Receipts (GDRs)/American Depository Receipt (ADR)/ Foreign Direct Investment (FDI)/Non Resident Indian (NRI)/Persons of Indian Origin (PIO)/Foreign Institutional Investors (FIIs)/Registered Foreign Portfolios Investors (RFPIs) in ING Vysya Bank has reached the trigger limit. Hence, further purchases of equity shares of this bank would be allowed only after obtaining prior approval of the Reserve Bank of India on behalf of FII/RFPI/NRI/PIOs and through FDI/ADR/GDRs under Schedule-I of FEMA.
Kotak Mahindra Bank and ING Vysya Bank have announced amalgamation of ING Vysya with Kotak in the ratio of 725 shares of Kotak for every 1,000 shares of ING Vysya Bank.
Key indices snapped a two-day losing streak today, 24 February 2015. The Sensex had fallen 487.16 points or 1.65% in two trading sessions to settle at 28,975.11 yesterday, 23 February 2015, from a recent high of 29,462.27 on 19 February 2015. The Sensex has fallen 178.29 points or 0.61% in this month so far (till 24 February 2015). The Sensex has risen 1,505.24 points or 5.47% in this calendar year so far (till 24 February 2015). From a 52-week low of 20,777.73 on 25 February 2014, the Sensex has risen 8,226.93 points or 39.59%. The Sensex is off 839.50 points or 2.81% from a record high of 29,844.16 hit on 30 January 2015.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 62.20, compared with its close of 62.3125 during the previous trading session.
Brent crude oil futures edged lower in choppy trade amid oil supply glut. Brent for April settlement was off 12 cents at $58.78 a barrel. The contract had dropped $1.32 a barrel to settle at $58.90 a barrel during the previous trading session.
Meanwhile, the BJP has reportedly formed committee to seek farmers' suggestion on land acquisition bill after the government introduced the land acquisition amendment bill in the Lok Sabha today, 24 February 2015, amid uproar by the Opposition. The Right to Fair Compensation and Transparency in Land Acquisition Rehabilitation and Resettlement (Amendment) Bill 2015 will replace an ordinance which had been promulgated by the NDA government on 30 December 2014. The Opposition parties, led by the Congress, vociferously opposed the bill on the floor of the house.
The Prime Minister's Office (PMO) today, 24 February 2015, said that Prime Minister Narendra Modi has written to Chief Ministers, informing them of the central government's decision to wholeheartedly accept the recommendations of the 14th Finance Commission. The PM firmly believes that strong states are the foundation of a strong India and that the central government is committed to the idea of empowering states in all possible ways, the PMO said. The 14th Finance Commission has recommended a record increase of 10% in the devolution of the divisible pool of resources to states. This compares with the marginal increases made by previous Finance Commissions. The total devolution to states in 2015-16 will be significantly higher than in 2014-15. This naturally leaves far less money with the central government. In making its recommendations, the 14th Finance Commission has made a fundamental shift in the pattern of financing revenue expenditures.
The PMO further said that the ongoing transparent auction of coal and other minerals will result in flow of over Rs 1 lakh crore of additional funds to mineral and coal bearing states.
Meanwhile, the stock exchanges have decided to keep the stock market open on Saturday, 28 February 2015, just like any other normal trading session when the Finance Minister Arun Jaitley presents the first full-fledged Budget of the Narendra Modi government. Trading will start at 9:15 IST and conclude at 15:30 IST. Jaitley will begin his speech at 11:00 IST in Lok Sabha on 28 February 2015 as he tables the Union Budget 2015-16 in the parliament.
The Railway Budget 2015-16 will be tabled in the parliament by rail minister Suresh Prabhu on Thursday, 26 February 2015. The Economic Survey will be tabled on Friday, 27 February 2015.
The next major event for the financial markets is Union Budget for 2015-16. Finance Minister Arun Jaitley will present Union Budget 2015-16 in Parliament on Saturday, 28 February 2015. Analysts will scrutinize measures in the Budget for financing infrastructure projects as well as the government's own capital expenditure on infrastructure for the year ahead. This is the first full fledged Budget of the Narendra Modi government and analysts will look for a roadmap for economic growth for the next few years.
Changes in rates of dividend distribution tax, capital gains tax on sale of shares, Securities Transaction Tax (STT) and Minimum Alternate Tax (MAT), if any, will be closely watched. The dividend distribution tax is currently at 15%. The minimum alternate tax is currently at 18.5% of book profits. Short term capital gains tax on sale of shares is currently at 15% while there is zero long capital gains tax on sale of shares held for a period of more than one year.
Analysts are awaiting further progress on the Goods and Services Tax (GST) during the ongoing Budget session of Parliament after the Constitution Amendment Bill for the introduction of GST was tabled in the Lok Sabha during the winter session of parliament. 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.
European shares slipped today, 24 February 2015, as investors waited for European officials to respond to economic-reform proposals submitted by Greece. Key benchmark indices in France and Germany were off 0.09% to 0.12%. In UK, the FTSE 100 was up 0.05%.
Greece remained firmly in focus. Greece yesterday, 23 February 2015, submitted a list of proposals on how to overhaul its economy in line with the country's bailout program. The Greek government needs its creditors to approve its proposals to secure a four-month extension to its bailout, which expires at the end of the month. Euro zone finance ministers would today, 24 February 2015, discuss Greece's plans as scheduled earlier.
Asian stocks edged higher today, 24 February 2015, before the US Federal Reserve Chair Janet Yellen speaks to lawmakers. Key benchmark indices in Singapore, Taiwan, Japan, Indonesia and South Korea rose by 0.26% to 1.05%. In Hong Kong, the Hang Seng index fell by 0.35%. China's mainland markets remain closed today, 24 February 2015 for the Lunar New Year holiday.
Markit Economics will tomorrow, 25 February 2015, announce preliminary reading of China's HSBC PMI index for February 2015, indicating health of China's manufacturing activity for that month.
Trading in US index futures indicated that the Dow could fall 3 points at the opening bell today, 24 February 2015. US stocks ended mixed yesterday, 23 February 2015 as lower oil prices dragged down energy shares. In economic data, sales of previously owned US homes fell in January as a tight supply forced up prices, showing the residential real-estate market faces an uneven recovery. Purchases slowed 4.9% to a 4.82 million annualized rate, the least since April, according to figures from the National Association of Realtors yesterday, 23 February 2015.
Investors will receive further clues on the central bank's assessment of the economy and the timing of a rate increase when Federal Reserve Chair Janet Yellen gives two days of testimony to Congressional finance committees starting today, 24 February 2015.
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