Firmness continued on the bourses in mid-morning trade. The market breadth, indicating the overall health of the market, was strong. The barometer index, the S&P BSE Sensex, was up 155.02 points or 0.76%, up close to 60 points from the day's low and off about 30 points from the day's high. Gains in Asian stocks boosted investor sentiment. Asian stocks edged higher on Thursday, 28 November 2013, after US employment and consumer confidence reports boosted optimism in the world's largest economy.
Bank stocks edged higher. Eicher Motors and CEAT hit record high.
The market surged in early trade on firm Asian stocks. The market extended initial gains and hit fresh intraday high in morning trade. Firmness continued on the bourses in mid-morning trade.
The market may remain volatile today, 28 November 2013, as traders roll over positions in the futures & options (F&O) segment from the near month November 2013 series to December 2013 series. The near month November 2013 derivatives contracts expire today, 28 November 2013.
At 11:20 IST, the S&P BSE Sensex was up 155.02 points or 0.76% to 20,575.28. The index jumped 186.12 points at the day's high of 20,606.38 in morning trade, its highest level since 25 November 2013. The index rose 97.71 points at the day's low of 20,517.97 in early trade.
The CNX Nifty was up 47.25 points or 0.78% to 6,104.35. The index hit a high of 6,112.95 in intraday trade, its highest level since 25 November 2013. The index hit a low of 6,090 in intraday trade.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1,188 shares rose and 710 shares dropped. A total of 128 shares were unchanged.
Among the 30-share Sensex pack, 27 stocks rose and only three fell. Dr Reddy's Laboratories (up 2.11%), RIL (up 1.81%) and Sesa Sterlite (up 1.78%) rose.
Bank stocks edged higher. HDFC Bank (up 0.93%) and ICICI Bank (up 1.13%) rose.
Among PSU bank stocks, State Bank of India, Canara Bank, Union Bank of India, Bank of Baroda and Punjab National Bank gained 0.01% to 0.87%.
The Reserve Bank of India (RBI) early this week said it has decided to include incremental bank loans to medium manufacturing enterprises (as defined in the MSMED Act, 2006), extended by banks after 13 November 2013 as priority sector advances. The RBI also said that incremental bank loans to medium service enterprises extended after 13 November 2013, up to the credit limit of Rs 10 crore, would qualify as priority sector advances. The RBI has also raised the loan limit given to micro and small service enterprises to Rs 10 crore from Rs 5 crore that will be treated as priority sector advance. This facility will remain open till 31 March 2014, the RBI said.
Under priority sector advance, most banks have to lend 40% of their loans to agriculture, micro and small enterprises, poor people for housing, students for education and other low income groups and weaker sectors.
Shares of tyre major CEAT rose 5.48% to Rs 292.50. The stock hit record high of Rs 294.70 in intraday trade.
Eicher Motors rose 4.15% to Rs 4,672.75, with the stock hitting record high of Rs 4,693.90 in intraday trade.
Alstom T&D India rose 5.47% to Rs 174.50 after the company said it is planning to raise up to Rs 294 crore by selling shares to institutional investors on Friday, 29 November 2013. The announcement was made after market hours on Wednesday, 27 November 2013.
Alstom T&D India will offer 1.69 crore equity shares of Rs 2 each of the company by way of an institutional placement programme (IPP) to qualified institutional buyers, the company said in a regulatory filing to stock exchanges.
The issue will open on Friday, 29 November 2013 and close on the same day. The price band for the issue shall be Rs 159-174 per equity share, it added. At the upper end of the price band, the company is expected to raise Rs 294 crore.
This is part of company's effort to meet the Securities and Exchange Board of India (Sebi)'s norm of minimum 25% public shareholding in the private sector listed companies. As on 30 September 2013, the promoters held 80.32% stake in Alstom T&D India.
Dish TV rose 1.37% to Rs 51.75. Three block deals were executed in the counter on BSE. One block deal was of 4 lakh shares struck at Rs 51.40 per share at 9:26 IST. Second block deal was of 4 lakh shares at Rs 51.45 per share at 9:27 IST and third block deal was of 1.52 lakh shares at Rs 51.65 per share at Rs 9:51 IST.
In the foreign exchange market, the rupee edged lower against the dollar on broad dollar gains triggered by positive US economic data overnight. The partially convertible rupee was at 62.38, compared with its close of 62.14/15 on Wednesday, 27 November 2013.
Indian government bond prices dropped as positive US economic data overnight added to concern the Federal Reserve is closer to reducing monthly bond purchases. The yield on 10-year benchmark federal paper, 7.16% GS 2023, was hovering at 9.0181%, higher than its close of 8.9962% on Wednesday, 27 November 2013. Bond yields and bond prices are inversely related.
The government will stick to its 2013/14 borrowing programme but will calibrate its debt sale plans according to market conditions, Economic Affairs Secretary Arvind Mayaram said today, 28 November 2013. "We are mindful of what the going yields are and therefore calibrate the borrowing accordingly because markets fluctuate. It's not that they are fixed at one point," Mayaram told reporters at the sidelines of a financial event. "We will continue with what our requirements are. But we will calibrate keeping in mind the market conditions on the day in which we go out," he said.
Mayaram also said the Reserve Bank of India is expected to switch back to a "more modest" interest rate regime once the country's investment cycle picks up. Mayaram also said that the government's Rs 40000-crore divestment programme for the current fiscal year ending in March 2014 (FY 2014) will be fully met.
India's economic growth is seen recovering a bit in Q2 September 2013. The GDP growth for Q2 September 2013 is projected at 4.7%, as per the median estimate of a poll of economists carried out by Capital Market. India's GDP grew at its slowest pace in four years at 4.4% in Q1 June 2013. The government unveils Q2 September 2013 GDP growth data tomorrow, 29 November 2013.
The Reserve Bank of India (RBI) announces next Mid-Quarter Review of Monetary Policy for 2013-14 on 18 December 2013. The Third Quarter Review of Monetary Policy for 2013-14 is scheduled 28 January 2014.
Asian stocks edged higher on Thursday, 28 November 2013, after US employment and consumer confidence reports boosted optimism in the world's largest economy. Key benchmark indices in China, Hong Kong, Taiwan, South Korea, Singapore, and Japan were up 0.59% to 1.45%. Indonesia's Jakarta Composite fell 0.02%.
Japan's top government spokesman today, 28 November 2013, said that Japanese and US defense ministers agreed on Wednesday in a telephone conference to respond resolutely and calmly to China's moves to alter the region's status quo. Chief Cabinet Secretary Yoshihide Suga said Japanese Defense Minister Itsunori Onodera and US Defense Secretary Chuck Hagel agreed that China's setting up a so-called air-defense zone recently is "an action that could lead to unforeseeable circumstances and hurt the regional stability." Mr. Suga said the Japanese government wants to deliver its view on the matter to China in coordination with US and other nations.
The zone covers airspace above a series of East China Sea island at the heart of a dispute between Japan and China, and its establishment triggered strong warnings from both Tokyo and Washington that the action would destabilize the region.
The US stock market is closed today, 28 November 2013, for the Thanksgiving holiday. The market will close early at 1:00 p.m. on Friday, 29 November 2013. US stocks rose on Wednesday, 27 November 2013, with Dow Jones Industrial Average and the S&P 500 ending at their record high as Hewlett-Packard Co. led a technology rally while data on employment and consumer confidence boosted optimism in the economy.
Data yesterday showed fewer Americans than projected filed applications for unemployment benefits last week, a sign that the labor market is showing resilience. The Thomson Reuters/University of Michigan final index of consumer sentiment in November unexpectedly rose to 75.1 from 73.2 a month earlier. The Conference Board's index of US leading indicators, a gauge of the economic outlook for the next three to six months, rose for a fourth straight month in October, reflecting gains in factory orders and applications to build new homes.
Investors have been keeping watch on economic data in the United States as the Federal Reserve monitors the pace of recovery to gauge when it will begin to reduce monetary stimulus for the US economy, which has been aimed at encouraging growth. The Fed has said improvement in the labor market is a key factor in its policy assessment. The Federal Open Market Committee (FOMC) holds a two-day policy meeting on interest rates in the United States on 17-18 December 2013. The US central bank currently buys bonds worth $85 billion a month in a bid to hold interest rates low and encourage economic growth in the world's biggest economy. Minutes of the Fed's October meeting released on 20 November 2013 showed officials may reduce their $85 billion a month of bond buying if the economy improves as anticipated.
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