Key benchmark indices edged lower as world stocks fell after Federal Reserve Bank of Atlanta President Dennis Lockhart on Monday, 13 January 2014, said that the US economy is on solid footing and he would support continued cuts to stimulus. Fed's bond-buying program has been a source of liquidity for most Asian and emerging markets in recent years. India has been one of the biggest beneficiaries of foreign capital flows. The barometer index, the S&P BSE Sensex, was provisionally down 91.99 points or 0.44%, off close to 145 points from the day's high and up about 35 points from the day's low. The market breadth, indicating the overall health of the market, was negative.
Metal shares witnessed selling pressure. Realty stocks also edged lower. Infosys edged higher in choppy trade and hit a record high. Tech Mahindra scaled a 52-week high. Tata Motors dropped after the company on Monday, 13 January 2014, announced the launch of the new Nano Twist, a new addition to the Nano range.
Indian stocks snapped two-day winning streak today, 14 January 2014.
A bout of volatility was witnessed as key benchmark indices alternately swung between positive and negative zone in early trade. Volatility continued as key benchmark indices trimmed losses after hitting fresh intraday low in morning trade. The Sensex extended losses and hit fresh intraday low in mid-morning trade. The Sensex languished in the negative terrain in early afternoon trade. Key benchmark extended losses and hit fresh intraday low in mid-afternoon trade.
As per provisional figures, the S&P BSE Sensex was down 91.99 points or 0.44% to 21,042.22. The index fell 125.16 points at the day's low of 21,009.05 in late trade. The index rose 20.55 points at the day's high of 21,154.76 in morning trade.
The CNX Nifty was down 29.75 points or 0.47% to 6,243, as per provisional figures. The index hit a low of 6,234.15 in intraday trade. The index hit a high of 6,280.35 in intraday trade.
The total turnover on BSE amounted to Rs 1680 crore, lower than Rs 2098.60 crore on Monday, 13 January 2014.
The market breadth, indicating the overall health of the market, was negative. On BSE, 1,477 shares dropped and 1,215 shares rose. A total of 133 shares were unchanged.
Among the 30-share Sensex pack, 19 stocks fell and rest of them rose.
Bharti Airtel declined 0.51%. The company announced during market hours that its wholly-owned subsidiary Bharti Airtel International (Netherlands) B.V. (Bharti) in a follow on Tap has priced euro 250 million 4% Guaranteed Senior Notes due 2018. The Notes will be fully and unconditionally guaranteed by Bharti Airtel.
The notes attracted huge investor interest with an order-book aggregating circa euro 600 million from high quality investor accounts. The success of tap on the existing bond emphasizes the continuing and strong belief of the investor community in Bharti's credit, Bharti Airtel said in a statement. Bharti had earlier in December 2013 raised euro 750 million in an inaugural benchmark euro issuance.
The notes have been priced at 275 basis points over the curve adjusted 5-year EUR Mid Swap with a fixed coupon of 4% per annum. Bharti will fully apply the net proceeds to refinance its existing debt.
Mr. Harjeet Kohli, Group Treasurer of Bharti, said: "We are delighted with the response in the Euro debt markets for Bharti Airtel. Across tenors and markets, Airtel now has USD 1.5 billion in the USD bond markets and Euro 1 billion in the Euro bond markets. These issuances have much diversified our sources of funding, currencies and investor base. The pricing and appetite represent the strong demand for a robust and internationally diversified Investment Grade credit like Bharti Airtel".
Infosys rose 0.77% to Rs 3,694, with the stock extending recent gains triggered by the company raising its revenue growth guidance for the year ending 31 March 2014. The scrip was volatile. The stock hit a record high of Rs 3,697.30 in intraday trade. The stock hit low of 3,636 in intraday trade. At the time of announcement of Q3 December 2013 earnings, Infosys, before trading hours on Friday, 10 January 2014, raised its revenue growth guidance in both rupee and dollar terms for the year ending 31 March 2014. The company expects consolidated revenue in rupee terms to grow 24.4% to 24.9% for the year ending 31 March 2014 (FY 2014). This guidance is based on rupee dollar conversion rate of 61.81 for the rest of the financial year. The company expects consolidated revenue in dollar terms to grow 11.5% to 12% in FY 2014.
Tech Mahindra advanced 0.35% to Rs 1,892 after hitting a 52-week high of Rs 1,906 in intraday trade.
Tata Steel declined 2.99%. Tata Steel said during market hours on Monday, 13 January 2014, that it registered 1.6% rise in hot metal production to 2.31 million tonnes in Q3 December 2013 over Q2 December 2012. Crude Steel production rose 3.7% to 2.16 million tonnes in Q3 December 2013 over Q2 December 2012. Saleable Steel production was higher by 3.9% to 2.15 million tonnes in Q3 December 2013 over Q2 December 2012. Steel sales rose 9.4% to 2.06 million tonnes in Q3 December 2013 over Q2 December 2012. Flat Product saleable steel production was best ever in Q3 December 2013 at 1.48 million tonnes (previous best was 1.46 million tonnes in Q4 March 2013), Tata Steel said.
Among other metal shares, Jindal Steel & Power (down 2.08%), Bhushan Steel (down 0.24%), NMDC (down 2.02%), Sail (down 1.78%), JSW Steel (down 1.19%), Sesa Sterlite (down 1.81%), National Aluminum Company (down 1.75%) and Hindalco Industries (down 0.32%), edged lower.
Realty stocks also edged lower. DLF (down 2.27%), D B Realty (down 1.41%), HDIL (down 0.2%), and Unitech (down 1.46%) declined.
Reliance Industries rose 0.11%, with the stock extending Monday's gains. Oil India dropped 0.3%. The government last week issued the notification regarding Domestic Natural Gas Pricing Guidelines, 2014. The new gas pricing norms will be applicable to all natural gas produced domestically, irrespective of the source, whether conventional, shale, CBM etc. These guidelines will be applicable from 1 April 2014. The new gas pricing norms shall be applicable to all consuming sectors uniformly, the Ministry of Petroleum & Natural Gas said in a statement on 10 January 2014. These guidelines shall also be applicable for natural gas produced by ONGC/Oil India from their nominated fields, it said.
First, the netback price of all Indian imports at the wellhead of the exporting countries will be estimated. Since there may be several sources of gas imports, the weighted average of such netback of import prices at the wellheads would represent the average global price for Indian LNG imports, the oil ministry said explaining the methodology of gas price calculation. Secondly, the weighted average of prices prevailing at trading points of transactions - i.e., the hubs or balancing points of the major global markets will be estimated. For this, (a) the hub price (at the Henry Hub) in the US (for North America), (b) the price at the National Balancing Point of the UK (for Europe), and (c) the netback wellhead price at the sources of supply for Japan will be taken as the average price for producers at their supply points across continents. Finally, the simple average of the prices arrived at through the aforementioned two methods will be determined as the price for domestically produced natural gas in India.
Domestic gas prices shall be notified in advance on a quarterly basis using the data for four quarters, with a lag of one quarter, the oil ministry said. In respect of D1 and D3 gas discoveries of Block KG-DWN-98/3, these guidelines shall be applicable subject to submission of bank guarantees in the manner to be notified separately, it said.
The extant gas pricing policy under NELP was earlier approved by the Government for five years commencing from April 2009 and is due for revision with effect from April 2014. The Government had constituted a Committee headed by Dr C Rangarajan, Chairman, Economic Advisory Council to the Prime Minister in May 2012, to look into "the Production Sharing Contract (PSC) mechanism in petroleum industry". The Terms of Reference (TOR) of the Committee included, among others, formulating a structure and elements of the guidelines for determining the basis or formula for the price of domestically produced gas, and for monitoring actual price fixation. The Committee submitted its report in December 2012. Based on Committee Report, Government of India (GOI) approved the Natural Gas Pricing Guidelines in its meeting held on 27 June 2013.
In pursuance of the earlier decision, GOI on 19 December 2013 approved applicability of the Guidelines for D1 and D3 gas discoveries of the NELP Block KG-DWN-98/3, subject to submission of bank guarantees that will be notified separately, the Ministry of Petroleum & Natural Gas said in a statement on 10 January 2014.
The Ministry of Petroleum and Natural Gas on Sunday, 12 January 2014, showcased 46 onshore and offshore hydrocarbon exploration blocks which have so far been finalized for auction in the Tenth round of the New Exploration Licensing Policy (NELP-X). Chairing the session to announce these blocks at the oil and gas industry event Petrotech 2014 at Greater Noida, Petroleum Minister Dr Verappa Moily said that more blocks will be identified and added to the Notice Inviting Offer (NIO). He said that the tender documents will be announced later while the prospective investors could take advantage of the advance information about these blocks.
Dr Moily invited various investors to take advantage of the vast investment opportunities in the Indian oil and gas sector. These are the blocks which have received all statutory clearances. Under NELP, 360 exploration blocks have been offered so far and 254 blocks have been awarded. Presently, 148 blocks are active and 106 have been relinquished.
ONGC lost 0.41%. ONGC and Kuwait Petroleum Corp (KPC) today, 14 January 2014, signed an initial agreement for broad co-operation that could see KPC pick up stakes in the ONGC Mangalore Petrochemicals (OMPL) and ONGC Petro-Additions (OPAL) projects. "We are seeking strategic partnership in the two companies. Twenty-six percent stake is being offered in (each of) the two projects," ONGC Chairman Sudhir Vasudeva said on the sidelines of the Petrotech 2014 industry conference. KPC chief executive Nizar al-Adsani said the agreement was the first of many steps to come and his company was looking at several opportunities in India and outside.
ONGC is developing the OMPL petrochemicals complex in south India, in which its subsidiary Mangalore Refinery and Petrochemicals will also hold a small stake. The company is developing the OPAL petrochemicals project, in a joint venture with GAIL (India) and Gujarat State Petroleum Corp (GSPC), at Dahej in western India, as part of its efforts to diversify beyond oil exploration and production.
Tata Motors dropped after the company on Monday, 13 January 2014, announced the launch of the new Nano Twist, a new addition to the Nano range. The stock lost 1.01% to Rs 372.25. The new Nano Twist, will now allow hassle-free and relaxed driving in city traffic with the new first-in-class Electric Power Assisted Steering (EPAS) system, designed for easy manoeuvring in tight driving and parking situations, the company said in a statement. A new signature Damson Purple colour, with chrome accents, new sporty interiors with new fabrics and stunning in-car features, make the Nano Twist an exciting car to drive, it said. The new Nano Twist will be available in the XT version, which replaces the previous top of the line LX version of the Nano range. All XT versions come with Beige interior with the exception of Dazzle Blue, which comes with sporty black interiors. The new Nano Twist XT is priced at Rs 2.36 lakh, ex-showroom Delhi. The Nano Twist will be available across all Tata Motors Authorized Dealerships, in a phased manner, Tata Motors said.
The Reserve Bank of India (RBI) said on Monday, 13 January 2014, it had eased rules for hedging foreign exchange exposures, allowing greater flexibility for cancelling and rebooking forward contracts. The RBI is now allowing domestically-held forward contracts for all current as well as capital account transactions with a residual maturity of one year or less to be freely cancelled and taken out again, called rebooking. Before the changes domestic exporters could cancel and rebook up to 50% of the contracts booked in a financial year for hedging their contracted export exposures. Importers were allowed to cancel and rebook up to 25% of contracts booked in a financial year. These limits have been dropped. Foreign investors will be allowed to rebook 10% of the value of cancelled contracts, up from nothing previously.
On macro front, the rate of inflation based on the combined consumer price index (CPI) of urban and rural India slowed to 9.87% in December 2013, from 11.16% in November 2013, data released by the government after trading hours on Monday, 13 January 2014, showed. The moderation was largely driven by a fall in vegetable prices, which cooled nearly 19% from November on improved supplies. That helped slow down annual food inflation to 12.16% last month from 14.72% in November.
The core CPI inflation excluding the volatile food and fuel prices, edged up to 8.05% in December 2013, from 7.97% in November 2013.
Inflation based on the wholesale price index (WPI) is seen easing up a bit at 7.1% in December 2013, from 7.52% in November 2013, as per the median estimate of a poll of economists carried out by Capital Market. WPI had accelerated to 7.52% in November 2013, from 7% in October 2013. The government will unveil WPI data for December 2013 at 12 noon tomorrow, 15 January 2014.
The Reserve Bank of India's Third Quarter Review of Monetary Policy for 2013-14 is scheduled on 28 January 2014. The Reserve Bank of India kept its main lending rate viz. the repo rate unchanged after its last policy review in December and said at that time that it expected inflation to ease in the following months.
European stocks edged lower on Tuesday, 14 January 2014, tracking weak Asian stocks and sharp overnight losses in US stocks. Key benchmark indices in France, Germany and UK were off 0.45% to 0.62%.
Asian stocks fell on Tuesday, 14 January 2014, after Federal Reserve Bank of Atlanta President Dennis Lockhart on Monday, 13 January 2014, said that the US economy is on solid footing and he would support continued cuts to stimulus. Fed's bond-buying program has been a source of liquidity for most Asian and emerging markets in recent years. Key benchmark indices in Hong Kong, Japan, Singapore, South Korea and Taiwan were down 0.15% to 3.08%. China's Shanghai Composite rose 0.86%.
Japan's current-account deficit widened to a record in November 2013 at 592.8 billion yen ($5.75 billion) before seasonal adjustment, data showed today, 14 January 2014.
Trading in US index futures indicated that the Dow could advance 8 points at the opening bell on Tuesday, 14 January 2014. US stocks sold off sharply Monday, resulting in the worst losses for benchmark indexes in several months, on concerns about the weak December jobs report and comments from a Federal Reserve official about a further reduction in stimulus. In a speech to the Rotary Club of America, Federal Reserve Bank of Atlanta President Dennis Lockhart said he supports "similar tapering steps" as the one taken to reduce bond-market purchases by $10 billion by the Federal Reserve last month, so long as the economy grows at the 2.5% to 3% clip he's forecasting this year. He pointed out that the labor market is not as healthy as a 6.7% unemployment rate suggests. He said continued disinflation could pose risks to economic performance. Lockhart doesn't vote on policy in 2014.
The Federal Open Market Committee (FOMC) holds a two-day monetary policy meeting on 28 and 29 January 2014. By a 9-to-1 vote, the Fed on 18 December 2013 decided to trim its asset-purchase program by $10 billion to $75 billion per month starting in January 2014.
Powered by Capital Market - Live News
