Key benchmark indices extended losses in early afternoon trade. The barometer index, the S&P BSE Sensex and CNX Nifty, both, hit fresh intraday low. The Sensex slipped below the psychological 29,000 level. The Sensex was currently off 195.64 points or 0.67% at 28,987.31. The market breadth indicating the overall health of the market was positive.
India's fiscal deficit reached 100.2% of Budget Estimate (BE) in nine months ended December 2014 to Rs 5.32 lakh crore, highlighting tight financial position of the central government. It was 95% of BE in corresponding period last year.
Bank stocks were mixed ahead of RBI's monetary policy review tomorrow, 3 February 2015. Coal India edged lower. Tata Motors advanced after decent sales in January 2015. Berger Paints India dropped after weak Q3 earnings.
Foreign portfolio investors sold shares worth a net Rs 771.55 crore on Friday, 30 January 2015, as per provisional data.
In the overseas markets, Asian equity markets were mixed today, 2 February 2015. US stocks declined on Friday, 30 January 2015 with benchmarks down for a second month, after data showed US economic growth slowed sharply in the fourth quarter and Russia's central bank unexpectedly cut is benchmark interest rate.
In the foreign exchange market, the rupee edged lower against the dollar amid volatility.
Brent crude oil futures declined amid speculation that the biggest strike at US refineries since 1980 will curtail crude processing in the world's leading consumer nation and worsen a global supply glut.
At 12:15 IST, the S&P BSE Sensex was down 195.64 points or 0.67% at 28,987.31. The index fell 223.87 points at the day's low of 28,959.08 in early afternoon trade, its lowest level since 22 January 2015. The index fell 24.38 points at the day's high of 29,158.57 in early trade.
The CNX Nifty was down 43.30 points or 0.49% at 8,765.60. The index hit a low of 8,751.10 in intraday trade, its lowest level since 22 January 2015. The index hit a high of 8,808.10 in intraday trade.
The BSE Mid-Cap index was up 48.81 points or 0.45% at 10,787.40. The BSE Small-Cap index was up 75.20 points or 0.66% at 11,404.46. Both these indices outperformed the Sensex.
The market breadth indicating the overall health of the market was positive. On BSE, 1,413 shares gained and 1,081 shares fell. A total of 113 shares were unchanged.
Bank stocks were mixed ahead of RBI's monetary policy review tomorrow, 3 February 2015. Bank of India (up 1.44%), Kotak Mahindra Bank (up 1.22%), Canara Bank (up 1.06%), Axis Bank (up 0.22%), Federal Bank (up 0.18%), and Punjab National Bank (up 0.05%) edged higher. Yes Bank (down 4.53%), Bank of Baroda (down 3.59%), ICICI Bank (down 2.52%), HDFC Bank (down 1.55%), IndusInd Bank (down 1.27%), and State Bank of India (down 0.94%) edged lower.
The RBI surprised financial markets by announcing a cut in its main lending rate viz. the repo rate by 25 basis points in an unscheduled monetary policy review on 15 January 2015, citing easing of inflationary pressures in the economy. The annual rate of inflation based on the combined consumer price indices (CPI) for urban and rural India rose to 5% in December 2014 from 4.4% in November 2014. Over the long term, the RBI aims to restrict consumer price inflation to 4%, within a two-per-cent band.
Coal India fell 2.23% at Rs 352.80. Coal during market hours today, 2 February 2015 reported production and offtake performance figures for January 2015. The actual production of Coal India and subsidiary companies was 93% of targeted production at 46.60 million tonnes in January 2015. The actual offtake was 88% of targeted offtake at 44.09 million tonnes in January 2015.
Meanwhile, the government successfully completed divestment of 10% stake in the state-run coal major through the stock exchanges mechanism on Friday, 30 January 2015. As against the total offer size of 63.16 crore shares of Coal India, total bids received were for a quantity of 67.5 crore shares across all categories. The oversubscription to the total quantity was around 5%. The CIL disinvestment has attracted the largest ever participation by foreign institutional investors in a Government Offer for Sale (OFS), according to a statement issued by the finance ministry after trading hours on Friday, 30 January 2015. With this divestment, the Government of India's (GoI) stake in CIL would come down to 79.65%, from 89.65%. The GoI has raised Rs 22557.63 crore from the CIL disinvestment.
Tata Motors rose 0.05% at Rs 585.25. Tata Motors during market hours today, 2 February 2015 said that its total commercial and passenger vehicles sales (including exports) rose 5% to 42,582 units in January 2015 over January 2014. Domestic sales of Tata commercial and passenger vehicles rose 5% to 38,621 units in January 2015 over January 2014. Sales of commercial vehicles in the domestic market remained flat at 25,574 units in January 2015 over a year ago. Sales of light commercial vehicles (LCVs) declined 18% to 14,301 units in January 2015 over January 2014. Sales of medium & heavy commercial vehicles (M&HCV) rose 38% to 11,273 units in January 2015 over January 2014. Exports rose 4% to 3,961 units in January 2015 over January 2014.
Berger Paints India fell 3.05% at Rs 222.25. On a consolidated basis, the company's net profit fell 0.18% to Rs 82.13 crore on 8.49% increase in total income to Rs 1126.23 crore in Q3 December 2014 over Q3 December 2013. The Q3 result was announced after market hours on Friday, 30 January 2015.
In the foreign exchange market, the rupee edged lower against the dollar amid volatility. The partially convertible rupee was hovering at 61.88, compared with its close of 61.8750 during the previous trading session on Friday, 30 January 2015.
Brent crude oil futures declined amid speculation that the biggest strike at US refineries since 1980 will curtail crude processing in the world's leading consumer nation and worsen a global supply glut. Brent for March settlement was off $1.26 a barrel at $51.73 a barrel. The contract had jumped $3.86 a barrel or 7.85% to settle at $52.99 a barrel during the previous trading session on Friday, 30 January 2015.
India's fiscal deficit reached 100.2% of Budget Estimate (BE) in nine months ended December 2014 to Rs 5.32 lakh crore, highlighting tight financial position of the central government. It was 95% of BE in corresponding period last year. The rise in fiscal deficit was mainly due to subdued revenue collection. The net tax revenue collection in April-December was Rs 5.46 lakh crore 55.8% of BE, lower from 58.6% during the same period last year.
Total receipts during the nine months of FY15 was Rs 7.04 lakh crore, a 55.7% of the target, lower than 57.7% collected in corresponding period 2013-14.
Plan expenditure of the government during the period was Rs 3.53 lakh crore, 61.3% of BE and non-Plan expenditure was Rs 8.84 lakh crore or 72.4% of BE.
The government is committed to contain fiscal deficit at its targeted 4.1% of the total GDP by the end of 31 March 2015. The fall in global oil prices has helped the government curb oil subsidy to oil marketing companies. Also, the 10% stake-sale in Coal India has already netted the government Rs 22,600 crore. Moreover, the government has approved base price of Rs 3705 crore per megahertz for 3G spectrum which will fetch it Rs 17,500 crore. This combined with the proceeds from 2G spectrum sale, the government aims to net over Rs 1 lakh crore.
Meanwhile, data released by the Ministry of Statistics & Programme Implementation after trading hours on Friday, 30 January 2015, showed that the Indian economy witnessed a strong recovery in the fiscal year ended 31 March 2014 (FY 2014). Based on a new series of national accounts with revision in base year from 2004-05 to 2011-12, India's gross domestic product (GDP) expanded 6.9% in FY 2014 compared with 5.1% expansion in FY 2013. Based on the previous data, the GDP grew 4.7% in FY 2014, from 4.5% expansion in FY 2013. Changes in the base year are made every five years. The dramatic revision could shake up the way the current trajectory of India's economy is perceived both at home and abroad. It also remains to be seen if the revised data will influence the Reserve Bank of India's (RBI) future monetary policy decisions. The RBI surprised financial markets by announcing a cut in its main lending rate viz. the repo rate by 25 basis points in an unscheduled monetary policy review on 15 January 2015, citing easing of inflationary pressures in the economy. The annual rate of inflation based on the combined consumer price indices (CPI) for urban and rural India rose to 5% in December 2014 from 4.4% in November 2014. Over the long term, the RBI aims to restrict consumer price inflation to 4%, within a two-per-cent band. The sixth bi-monthly monetary review from the RBI is scheduled tomorrow, 3 February 2015.
Asian equity markets were mixed today, 2 February 2015. Key indices in China, Hong Kong, Japan, and Indonesia were off 0.39% to 1.9%. Key indices in Taiwan, South Korea, and Singapore were up 0.18% to 0.53%.
The HSBC China Manufacturing Purchasing Managers' Index, a gauge of nationwide manufacturing activity, inched up to a final reading of 49.7 in January from 49.6 in December, HSBC Holdings PLC said today, 2 February 2015. A reading below 50 indicates a contraction in manufacturing activity from the previous month, whereas a reading above indicates an expansion.
Trading in US index futures indicated that the Dow could gain 27 points at the opening bell today, 2 February 2015. US stocks declined on Friday, 30 January 2015 with benchmarks down for a second month, after data showed US economic growth slowed sharply in the fourth quarter and Russia's central bank unexpectedly cut is benchmark interest rate. US economic growth slowed sharply in the fourth quarter as weak business spending and a wider trade deficit offset the fastest pace of consumer spending since 2006. Gross domestic product expanded at a 2.6% annual pace after the third quarter's spectacular 5% rate, the Commerce Department said in its first GDP snapshot on Friday, 30 January 2015.
Meanwhile, Russia's central bank has surprised financial markets and sent the rouble tumbling by cutting its key interest rate to soften the blows from falling oil prices and western sanctions. The main interest rate was cut to 15% from 17%, just weeks after the central bank had raised the interest rate in the hope of preventing the rouble's collapse.
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