Key benchmark indices trimmed intraday gains in mid-morning trade. The 50-unit CNX Nifty regained the psychological 8,000 mark after falling below that mark for a brief period in mid-morning trade. The index had reclaimed that mark in opening trade. The barometer index, the S&P BSE Sensex, was currently up 28.73 points or 0.11% at 26,781.63. The market breadth indicating the overall health of the market was positive. Brent crude oil prices extended its decline to a third day. Falling crude oil prices augur well for India as the country imports 80% of its crude oil requirement. However, a slide in rupee against the dollar will restrict the benefit of falling crude oil prices.
Shares of PSU banks extended Monday's gains triggered by Finance Minister Arun Jaitley's comments in a newspaper interview that the government intends to bring down its stake in PSU banks to about 52% to enable PSU banks to raise capital to meet the Basel-III norms. Shares of private sector banks were mixed.
Meanwhile, Japanese telecommunications company SoftBank Corp. and Indian e-retailer Snapdeal today, 28 October 2014, announced definitive agreements under which the SoftBank Group will become the largest investor in Snapdeal, through a total investment of $627 million. Seperately, SoftBank Corp. and ANI Technologies -- which runs the popular Ola Cabs taxi booking service in India -- announced a definitive agreement under which SoftBank Group will lead an investment of $210 million in Ola along with existing investors.
The Indian government issued a statement today, 28 October 2014, stating that Chairman and CEO of SoftBank, Mr. Masayoshi Son told the Minister for Communications and Information Technology and Law & Justice Mr. Ravi Shankar Prasad that SoftBank would like to invest approximately $10 billion in India in the coming years. Son met Prasad in New Delhi last evening. Mr. Son placed it on record that India is the top most priority for SoftBank. He further expressed immense faith in the great eCommerce potential of India. He estimated it to become a $0.5 trillion business in the next 10 years, the Ministry of Communications & Information Technology said in a statement.
In overseas markets, Asian stocks fell after American data from home sales to manufacturing fell short of estimates and investors awaited a Federal Reserve decision on its stimulus program.
In the foreign exchange market, the rupee edged lower against the dollar.
Brent crude oil prices extended its decline to a third day on ample global oil supplies.
Indian stocks may remain volatile this week as traders roll over positions in the futures & options (F&O) segment from the near month October 2014 series to November 2014 series. The near month October 2014 derivatives contract expire on Thursday, 30 October 2014.
At 11:17 IST, the S&P BSE Sensex was up 28.73 points or 0.11% at 26,781.63. The index jumped 112.21 points at the day's high of 26,865.11 in morning trade. The index rose 28.34 points at the day's low of 26,781.24 in mid-morning trade.
The CNX Nifty was up 11.75 points or 0.15% at 8,003.45. The index hit a high of 8,020.80 in intraday trade. The index hit a low of 7,998.85 in intraday trade.
The BSE Mid-Cap index was up 6.76 points or 0.07% at 9,598.85, underperforming the Sensex. The BSE Small-Cap index was up 38.98 points or 0.37% at 10,681.67, outperforming the Sensex.
The market breadth indicating the overall health of the market was positive. On BSE, 1,182 shares rose while 1,023 shares declined. A total of 98 shares were unchanged.
Shares of PSU banks extended Monday's gains triggered by Finance Minister Arun Jaitley's comments in a newspaper interview that the government intends to bring down its stake in PSU banks to about 52% to enable PSU banks to raise capital to meet the Basel-III norms. Dena Bank (up 0.71%), Union Bank of India (up 1.36%), Andhra Bank (up 1.04%), UCO Bank (up 0.12%), Bank of Baroda (up 1.12%), Oriental Bank of Commerce (up 0.23%), Indian Overseas Bank (up 0.41%) and State Bank of India (up 1.67%), edged higher. Bank of India (down 0.29%), Canara Bank (down 0.35%) and IDBI Bank (down 0.29%) declined.
Meanwhile, the government yesterday, 27 October 2014, said it has decided to finalise a new process for selection of CMDs/EDs of public sector banks for all future vacancies. The government has decided that a fresh process for selection will be implemented for filling-up vacancies for eight posts of CMDs and fourteen posts of EDs of public sector banks wherein the Governor, Reserve Bank of India or his nominee of the rank of Deputy Governor should be a part of the selection process.
State Bank of Mysore jumped 11.36% after net profit surged 238.76% to Rs 101.90 crore on 12.61% growth in total income to Rs 1900.52 crore in Q2 September 2014 over Q2 September 2013. The bank's ratio of gross non-performing assets (NPAs) to gross advances stood at 5.07% as on 30 September 2014 as against 5.13% as on 30 June 2014 and 5.96% as on 30 September 2013. The ratio of net NPAs to net advances stood at 2.94% as on 30 September 2014 as against 2.72% as on 30 June 2014 and 3.69% as on 30 September 2013.
Shares of private sector banks were mixed. ICICI Bank (up 1.51%), Axis Bank (up 0.31%) and HDFC Bank (up 0.26%), edged higher. Yes Bank (down 0.29%), Kotak Mahindra Bank (down 0.54%), and IndusInd Bank (down 1.37%) declined.
Bharti Infratel slipped 0.12% to Rs 289.95 in volatile trade after the company announced Q2 result after market hours yesterday, 27 October 2014. The stock hit high of Rs 299.25 and low of Rs 289.10 so far during the day. Bharti Infratel's consolidated net profit rose 67.7% to Rs 465.20 crore on 11.1% increase in total income to Rs 3043.80 crore in Q2 September 2014 over Q2 September 2013. The results are as per International Generally Accepted Accounting Principles (IGAAP).
Astral Poly Technik tumbled 8% after net profit jumped 27.6% to Rs 20.69 crore in 18.9% growth in net sales 303.33 crore in Q2 September 2014 over Q2 September 2013.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 61.3675, compared with its close of 61.31 during the previous trading session.
Brent crude oil prices extended its decline to a third day on ample global oil supplies. Brent crude for December delivery was off 52 cents at $85.31 a barrel. The contract had lost 30 cents to settle at $85.83 a barrel during the previous trading session.
The government's decision this month to decontrol diesel prices and a sharp decline in global crude oil prices recently will help India in containing its fiscal deficit. The fall in global crude oil prices will also help India in containing its current account deficit and fuel price inflation. India imports 80% of its crude oil requirement. A slump in Brent crude since the end of June contributed to consumer-price index slowing to 6.46% last month, the least since 2012.
However, a slide in rupee against the dollar will restrict the benefit of falling crude oil prices.
Asian stocks fell today, 28 October 2014, after American data from home sales to manufacturing fell short of estimates and investors awaited a Federal Reserve decision on its stimulus program. Key benchmark indices in Indonesia, South Korea, Singapore and Japan were off 0.18% to 0.44%. Key benchmark indices in China, Hong Kong and Taiwan were up 0.82% to 1.71%.
Trading in US index futures indicated that the Dow could gain 30 points at the opening bell today, 28 October 2014. US stocks ended mostly higher on Monday, 27 October 2014, with gains limited by weak economic data.
Data yesterday, 27 October 2014, indicated uneven economic growth in the US. Contracts to purchase previously owned homes rose less than forecast in September, showing housing will take time to gain momentum. Another release showed growth in services activity slowed this month, while the Dallas Fed's gauge of regional manufacturing fell.
A two-day meeting of the Federal Open Market Committee (FOMC) on US monetary policy review begins today, 28 October 2014. The Fed is expected to announce the end of quantitative easing after the meeting. Investors will be looking to see if the Fed drops the "considerable period" language in referencing its plans keeping rates low, at the two-day policy meeting, which concludes tomorrow, 29 October 2014. As several Fed officials have come out with dovish comments recently, investors largely expect that guidance to be reiterated.
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