A bout of volatility was witnessed as key benchmark indices trimmed gains once again to hit fresh intraday low after regaining strength in mid-morning trade. The S&P BSE Sensex was up 128.45 points or 0.7%, off close to 200 points from the day's high and up about 20 points from the day's low. The market breadth, indicating the overall health of the market, was strong. Pharma heavyweights edged lower. Auto stocks gained. Bhel extended intraday gain.
The market surged amid initial volatility after the Reserve Bank of India (RBI) on Tuesday, 20 August 2013, announced measures to increase the availability of cash in the banking system. The Sensex trimmed gains to hit fresh intraday low in morning trade. A bout of volatility was witnessed as key benchmark indices trimmed gains once again to hit fresh intraday low after regaining strength in mid-morning trade.
At 11:20 IST, the S&P BSE Sensex was up 128.45 points or 0.7% to 18,374.49. The index surged 321.66 points at the day's high of 18,567.70 in early trade, its highest level since 19 August 2013. The index rose 109.34 points at the day's low of 18,355.28 in mid-morning trade.
The CNX Nifty was up 45.60 points or 0.84% to 5,447.05. The index hit a high of 5,504.10 in intraday trade, its highest level since 16 August 2013. The index hit a low of 5,442.20 in intraday trade.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1,194 shares rose and 609 shares fell. A total of 123 shares were unchanged.
Among the 30-share Sensex pack, 18 stocks rose and rest of them fell. HDFC Bank (up 4.52%), State Bank of India (up 3.84%), HDFC (up 3%) and ICICI Bank (up 2.77%), edged higher.
Bhel surged 6.7% to Rs 108.30, with the stock extending intraday gain. The stock had hit a 52-week low of Rs 100.35 in intraday trade on Tuesday, 20 August 2013.
Pharma heavyweights edged lower. Cipla (down 0.52%), Dr Reddy's Laboratories (down 1%), Ranbaxy Laboratories (down 3.25%) and Sun Pharmaceutical Industries (down 1.15%), declined.
Auto stocks gained. Mahindra & Mahindra (M&M) rose 2.43%. The company on 14 August 2013 said it plans to invest Rs 200 crore to strengthen its current product line-up of trucks and buses. The company plans to invest Rs 300 crore to explore new product lines in the LCV, ICV and MCV range, it said.
Maruti Suzuki India advanced 0.54%.
Tata Motors rose 1.06%. The company's global wholesale vehicle sales fell 14% to 87,566 vehicles in July 2013 over July 2012. Global sales of passenger cars fell 13% to 46,684 vehicles in July 2013 over July 2012. Sales of its Jaguar Land Rover brand rose 30.61% to 35,162 units. Sales of its Jaguar cars rose 76.53% to 7,174 vehicles and Land Rover sales were higher by 22.45% at 27,988 vehicles during the month. The company announced the global vehicle sales figures on 14 August 2013.
Shares of two wheeler makers also gained. Bajaj Auto gained 2.61%. Bajaj Auto on 13 August 2013 said that the company has received a notice from the workmen's union viz. Vishwa Kalyan Kamgar Sanghatana stating that the stoppage of work at Chakan plant has been withdrawn and all the workmen at Chakan plant will resume their duty in their respective shifts from 14 August 2013. The company had earlier informed on 25 June 2013, that it had received a notice from the workmen's union of its Chakan plant viz., Vishwa Kalyan Kamgar Sanghatana stating that they propose to call for a stoppage of work by all the workmen employed in Chakan plant from the morning shift of 28 June 2013. The workmen at Chakan Plant had however, stopped coming from 25 June 2013 itself, without assigning any reason.
Hero MotoCorp rose 1.77%.
Oriental Bank of Commerce (up 6.9%), Sintex Industries (up 5.76%), Amtek India (up 5.51%), State Bank of Bikaner and Jaipur (up 5.08%) and Gitanjali Gems (up 5%), were the biggest gainers from the BSE Mid-Cap index.
The RBI on Tuesday, 20 August 2013, said it would repurchase government bonds to increase the availability of cash in the banking system, a step that appears to be a partial reversal of the slew of measures it took since mid-July to tighten liquidity. In a late evening news release, the RBI said it would buy back Rs 8000-crore of government bonds on Friday, 23 August 2013. Further repurchase will depend on evolving market conditions, it said. It is important to ensure that the liquidity tightening doesn't harden long-term bond yields and impact the flow of credit to productive sectors of the economy, the central bank said, referring to its buyback plan.
The RBI on Tuesday also relaxed some rules that will help banks deal with the notional or marked-to-market (MTM) loss in their government bond portfolios due to a recent sharp fall in bond prices. They now don't have to record their current marked-to-market losses immediately as the RBI has allowed them to spread the losses equally over the remaining period of this fiscal year.
Bond prices surged after the RBI on Tuesday, 20 August 2013, announced measures to increase the availability of cash in the banking system. The yield on the benchmark federal paper 7.16% GS 2023 was hovering at 8.3953%, sharply lower than its close of 8.9028% on Tuesday, 19 August 2013. Bond yield and bond prices are inversely related.
The rupee weakened against the dollar. The rupee was hovering at 63.4250, weaker than its close of 63.25/26 on Tuesday, 19 August 2013.
Most Asian stocks fell on Wednesday, 21 August 2013, before the release of minutes of the Federal Reserve's July meeting. Key benchmark indices in Singapore, Hong Kong, China, and South Korea were down by 0.36% to 0.94%. Key benchmark indices in Japan and Indonesia rose by 0.16% to 1.06%. Taiwan's Taiwan Weighted was flat.
Trading in US index futures indicated that the Dow could fall 14 points at the opening bell on Wednesday, 21 August 2013. US stocks on Tuesday, 20 August 2013, mostly climbed, with the S&P 500 halting its longest losing streak this year, as retailers including Best Buy Co. beat estimates and as Wall Street looked to clues about future US monetary policy. The Federal Open Market Committee (FOMC) later in the global day today, 21 August 2013, will issue minutes of its recent policy meeting held on 30 and 31 July 2013. The minutes of FOMC meet may help provide clues about the future of Fed's bond-buying program.
The US central bank currently buys $85 billion a month in US debt and mortgage-backed securities in a bid to hold interest rates low and encourage economic growth. Federal Reserve Chairman Ben Bernanke has on several occasions stressed that the tapering process is dependent on an improvement in data. Fed's bond-buying program has kept global markets flush with liquidity in recent years.
Powered by Capital Market - Live News
