Gains in European stocks aided intraday recovery for key equity benchmark indices in India. The barometer index, the S&P BSE Sensex, was currently trading above the psychological 29,000 mark, having alternately moved above and below that level in intraday trade so far. The Sensex had reclaimed the psychological 29,000 mark after registering decent gains during the previous trading session on Monday, 13 April 2015. The Sensex was currently off 15.50 points or 0.05% at 29,028.94. The market breadth indicating the overall health of the market was positive. Small-cap stocks were in demand. Among the gainers from the constituents of the BSE Small-Cap index, gains ranged from 2% to 20% for quite a few stocks
Pharma shares edged lower. Cement stocks gained after ACC reported a surge in operating earnings before interest, taxation, depreciation and amortization (EBITDA) in Q1 March 2015 over Q1 March 2014.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 417.01 crore during the previous trading session on Monday, 13 April 2015, as per provisional data as per provisional data released by the stock exchanges. The stock market was closed yesterday, 14 April 2015, for a holiday. Domestic institutional investors (DIIs) bought shares worth a net Rs 46.42 crore during the previous trading session on Monday, 13 April 2015, as per provisional data.
On the macro front, data released by government today, 15 April 2015, showed that inflation based on the wholesale price index (WPI) remained in negative zone last month. The WPI data comes after data released by the government after trading hours on Monday, 13 April 2015, showed easing of consumer price inflation last month.
Meanwhile, Prime Minister Narendra Modi early this week said that India is trying to introduce an element of transparency and predictability in its taxation system.
In the foreign exchange market, the rupee edged higher against the dollar.
Brent crude oil futures edged higher after the International Energy Agency raised its demand growth estimate for 2015 by 90,000 barrels a day to 93.6 million barrels a day. The recent rise in global crude oil prices will raise concerns pertaining to India's fiscal deficit, current account deficit and fuel price inflation. However, gains in rupee against the dollar will mitigate the negative impact of higher crude oil price. Gains in local currency will reduce the cost of imports. India imports about 80% of its crude oil requirements.
In overseas markets, European stocks edged higher ahead of the latest policy announcement from the European Central Bank (ECB). Asian stocks were mixed. Most US stocks edged higher yesterday, 14 April 2015, as crude oil prices rose.
At 14:18 IST, the S&P BSE Sensex was down 15.50 points or 0.05% at 29,028.94. The index fell 125.70 points at the day's low of 28,918.74 in early afternoon trade. The index gained 50.17 points at the day's high of 29,094.61 at onset of the trading session, its highest level since 13 March 2015.
The CNX Nifty was down 9.05 points or 0.1% at 8,824.95. The index hit a low of 8,795.05 in intraday trade. The index hit a high of 8,844.80 in intraday trade, its highest level since 13 March 2015
The market breadth indicating the overall health of the market was positive. On BSE, 1,556 shares gained and 1,159 shares fell. A total of 94 shares were unchanged.
The BSE Mid-Cap index was up 60.74 points or 0.55% at 11,188.16. The BSE Small-Cap index was up 88.21 points or 0.74% at 12,030.24. Both these indices outperformed the Sensex.
Pharma shares edged lower. Sun Pharmaceutical Industries (down 1.88%), Cipla (down 1.49%), Dr Reddy's Laboratories (down 0.13%), Lupin (down 0.86%), GlaxoSmithKline Pharmaceuticals (down 0.26%) and Wockhardt (down 1.46%) edged lower. Cadila Healthcare (up 2.09%) and Glenmark Pharmaceuticals (up 0.98%) rose.
Cement stocks gained after ACC reported a surge in operating earnings before interest, taxation, depreciation and amortization (EBITDA) in Q1 March 2015 over Q1 March 2014. Ambuja Cements (up 1.58%), UltraTech Cement (up 0.22%) and Shree Cement (up 0.06%) gained.
Grasim Industries was up 0.95% at Rs 3,814.65. Grasim has exposure to the cement sector through its subsidiary UltraTech Cement.
ACC rose 2%. ACC's consolidated net profit tumbled 40.84% to Rs 236.54 crore on 0.65% decline in total income to Rs 3140.31 crore in Q1 March 2015 over Q1 March 2014. The result was announced on Tuesday, 14 April 2015. ACC's operating earnings before interest, taxation, depreciation and amortization (EBITDA) rose 43.38% to Rs 609.48 crore in Q1 March 2015 over Q1 March 2014. Operating EBITDA reflects continued margins improvements and also includes accrual of an amount of Rs 139.74 crore pursuant to favourable order dated 24 February 2015, of the Jharkhand High Court pertaining to disputes related to incentives for the period August 2005 to March 2015, which were earlier committed by the State of Jharkhand but was denied thereafter.
The profit before tax (PBT) fell 19.06% to Rs 310.12 crore in Q1 March 2015 over Q1 March 2014. PBT includes an additional charge of Rs 164.45 crore being the carrying amount as of 1 January 2015 of fixed assets with no remaining useful life (as revised) as of that date in accordance with the provisions of Schedule II of the Companies Act 2013 becoming applicable to the company with effect from 1 January 2015.
With regard to future business outlook, ACC said that cement demand is likely to improve in the next two quarters. The management's focus on performance will continue, ACC said.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 62.4325, compared with closing of 62.5225 during the previous trading session on Monday, 13 April 2015. The foreign exchange market was closed yesterday, 14 April 2015, on the occasion of Dr. Baba Saheb Ambedkar Jayanti.
Minister of State for Finance Jayant Sinha reportedly said today, 15 April 2015, that India needs to move towards full capital account convertibility to become a leading global economy.
Brent crude oil futures edged higher after the International Energy Agency (IEA) raised its demand growth estimate for 2015 by 90,000 barrels a day to 93.6 million barrels a day. Brent for May settlement which expires today, 15 April 2015, was up 82 cents at $59.25 a barrel. The contract had risen 50 cents or 0.86% to settle at $58.43 a barrel during previous trading session. Brent for June settlement was up 94 cents to $60.75 a barrel.
Global oil demand will grow by more than previously expected in 2015, driven mainly by colder temperatures and a steadily improving global economic backdrop, IEA, the West's energy watchdog, said today, 15 April 2015. In its monthly oil-market report, the IEA revised its demand growth estimate for 2015 up by 90,000 barrels a day to 93.6 million barrels a day--a gain of 1.1 million barrels a day on the year--due to additional demand to heat homes, offices and other buildings in most economies of the Organization for Economic Cooperation and Development. The Paris-based agency, which advises industrialized nations on oil policies, said the gain was a notable acceleration on last year's 700,000 barrels a day growth.
Closer home, data released by government today, 15 April 2015, showed that inflation based on the wholesale price index (WPI) stood at negative 2.33% in March 2015 compared with a reading of negative 2.06% in February 2015. Meanwhile, WPI inflation for January 2015 was revised downwards. WPI inflation for January 2015 showed a negative reading of 0.95% compared with a negative reading of 0.39% reported earlier.
Earlier, data released by the government after market on Monday, 13 April 2015, showed that the all-India general CPI inflation slowed down to three-month low of 5.2% in March 2015 from 5.4% in February 2015. Food items were major contributors to the CPI inflation decline in March 2015.
India and Germany have decided to utilize the momentum generated by India's participation in the Hannover Messe in Germany to foster stronger ties between business and industry in both the countries in order to support India's 'Make in India' initiative, according to a joint statement issued by India and Germany yesterday, 14 April 2015, after Prime Minister Narendra Modi held bilateral talks with German Chancellor Angela Merkel in Berlin. India and Germany have also decided to take steps whereby Germany will support development of urban planning and infrastructure in India, including the development of smart cities in India, setting up peer-to-peer network of municipalities for direct collaboration and assistance in the area of affordable housing.
Germany will also support modernization of the railway infrastructure in India, including setting up of semi high-speed and high-speed railways and training and skill development of personnel in the rail sector starting with signalling and telecommunications and a high-speed rail system. Germany will also support India's proposed objective of 175 Giga Watts (GW) of renewable energy by 2022 through technical and financial support for developing comprehensive solar rooftop and green energy corridor projects in India.
India and Germany also agreed to strengthen their efforts towards carrying on negotiations for an ambitious EU India Free Trade Agreement with a view to its early conclusion.
Modi on Monday, 13 April 2015, said India is trying to introduce an element of transparency and predictability in taxation system. In his speech at the inauguration of the Indo-German Business Summit in Hannover, Germany, Modi said that the government has fast tracked approvals in industry and infrastructure. This includes environmental clearances, extending the industrial licences, delicencing of defence items and simplification of cross-border trade. Meanwhile, Modi said in his remarks at the Community Reception in Berlin yesterday, 14 April 2015, that the time is right for India to emerge as a global manufacturing hub. The Prime Minister called for balanced growth in the Indian economy, with equal emphasis on agriculture, manufacturing and services.
In overseas markets, European stocks edged higher today, 15 April 2015, ahead of the latest policy announcement from the European Central Bank (ECB). Key benchmark indices in Germany, France and UK were up 0.44% to 0.67%.
The ECB is widely expected to keep its key rates unchanged after a monetary policy review today, 15 April 2015.
In Greece, the new government has been locked in negotiations with its international creditors since coming to power in late January, with progress slow. The country needs to strike a deal within the next few months to secure billions of euros in bailout aid to avoid defaulting on its debts and potentially exiting the euro.
French consumer prices rose in March compared with the previous month, as the country exited the regulated sales season, prices of fresh produce rose and fuel prices slightly rebounded, statistics agency Insee said today, 15 April 2015. France's consumer price index rose 0.7% in March from February, after rising 0.7% on the month in February, although it recorded a 0.1% decline compared with a year earlier.
German consumer prices rose on the month in March, supporting cautious optimism that the European Central Bank's stimulus measures are starting to have an effect. Consumer prices measured according to common European standards rose 0.5% on the month and 0.1% on the year, the Federal Statistics Office said today, 15 April 2015, confirming its first estimate published at the end of March.
Asian stocks were mixed. Key benchmark indices in China, Taiwan, Japan and Indonesia fell by 0.2% to 1.24%. Key benchmark indices in Hong Kong, Singapore and South Korea rose by 0.21% to 0.39%.
China's economy expanded at its slowest pace in six years in the first quarter, weighed down by a slumping property market, industrial overcapacity and sluggish overseas demand, data released today, 15 April 2015 showed. China's gross domestic product rose 7% from a year earlier in the first quarter, slowing from 7.3% recorded in the fourth quarter of 2014 and 7.4% for all of last year.
Value-added industrial output in China rose 5.6% in March from a year earlier, slowing from 6.8% growth in the combined January-February period, data from the National Bureau of Statistics showed today, 15 April 2015. Month-on-month, industrial output increased 0.25% in March from February, when output rose 0.45% from January.
Fixed-asset investment in the non-rural areas of China climbed 13.5% from a year earlier in the January-March period, compared with an increase of 13.9% for the first two months of the year.
Trading in US index futures indicated that the Dow could rise 41 points at the opening bell today, 15 April 2015. US stocks ended yesterday, 14 April 2015 mostly higher, helped by energy stocks and quarterly earnings reports that topped modest expectations following worries about a strong dollar.
In US economic data, sales at US retailers rose in March by the largest amount in a year, rebounding after three straight monthly declines. However, the rebound was weaker than expected. US producer prices rose a seasonally adjusted 0.2% in March after four straight monthly declines, the Labor Department said yesterday, 14 April 2015.
Meanwhile, the International Monetary Fund (IMF) said in its latest World Economic Outlook (WEO) that global growth prospects are uneven across major economies. In advanced economies, growth is projected to strengthen in 2015 relative to 2014, but in emerging market and developing economies it is expected to be weaker, the IMF said. Overall, global growth is forecast at 3.5% in 2015 and 3.8% in 2016. IMF said that risks to global growth are now more balanced relative to six months ago, but remain tilted to the downside. Macroeconomic risks have slightly decreased (e.g., recession and deflation in euro area), but financial and geopolitical risks have increased, the IMF said. On the upside, the decline in oil prices could provide a greater boost to global growth than anticipated.
IMF Economic Counselor and Director of Research Olivier Blanchard said that a number of complex forces are shaping the prospects around the world. Legacies of both the financial and the euro area crisesweak banks and high levels of public, corporate, and household debtare still weighing on spending and growth in some countries. Low growth in turn makes deleveraging a slow process. Global growth in 2015 will be driven by a rebound in advanced economiesforecast to increase from 1.8% last year to 2.4% this yearsupported by the decline in oil prices, the WEO notes. Growth forecasts for most emerging and developing economies (with the important exception of India) are slightly worse.
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