Key benchmark indices retained positive zone in afternoon trade. The barometer index, the S&P BSE Sensex, was up 58.39 points or 0.26%, off close to 87 points from the day's high and up about 31 points from the day's low. The market breadth, indicating the overall health of the market, was strong. The BSE Small-Cap index was up more than 1%. The BSE Mid-Cap index was up 1%.
Index heavyweight Reliance Industries (RIL) rose to hit 52-week high after the company said that Export Development Canada, Canada's leading financier and insurer of Canadian exporting companies, has announced $500 million in financing for the company.
Key benchmark indices edged higher and hit fresh record high at the onset of the trading session. The Sensex and the 50-unit CNX Nifty, both, hit fresh record high. Key benchmark indices retained positive zone in morning trade. Key benchmark indices moved in a narrow range in positive terrain in mid-morning trade. Key benchmark indices recovered from lower level soon after trimming intraday gains in early afternoon trade. Key benchmark indices retained positive zone in afternoon trade
The market sentiment was boosted by data showing that foreign institutional investors (FIIs) remained net buyers of Indian stocks on Tuesday, 1 April 2014. FIIs bought shares worth a net Rs 385.66 crore on Tuesday, 1 April 2014, as per provisional data from the stock exchanges.
At 13:15 IST, the S&P BSE Sensex was up 58.39 points or 0.26% to 22,504.83. The index jumped 145.66 points at the day's high of 22,592.10 in early trade, a record high for the barometer index. The index rose 27.32 points at the day's low of 22,473.76 in early afternoon trade.
The CNX Nifty was up 10.30 points or 0.15% to 6,731.35. The index hit a high of 6,763.50 in intraday trade, a record high for the index. The index hit a low of 6,726.30 in intraday trade.
The BSE Mid-Cap index was up 71.01 points or 1% at 7,157.01. The BSE Small-Cap index was up 73.35 points or 1.03% at 7,180.07. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1,627 shares gained and 904 shares fell. A total of 131 shares were unchanged.
Among the 30-share Sensex pack, 20 stocks gained and rest of them declined. Bharti Airtel (up 2.50%), Cipla (up 2.32%), Tata Motors (up 2.15%), Wipro (up 1.86%), ICICI Bank (up 1.50%), Sun Pharmaceutical Industries (up 1.21%), Infosys (up 1.09%), Tata Power (up 1.01%), Larsen & Toubro (up 0.9%), TCS (up 0.9%) and NTPC (up 0.7%), edged higher from the Sensex pack.
HDFC Bank (down 2.03%), Hindalco Industries (down 1.48%), Axis Bank (down 1.13%), Sesa Sterlite (down 1.07%), Hindustan Unilever (down 1.01%), Coal India (down 0.85%), Bhel (down 0.67%), Bajaj Auto (down 0.42%) and ONGC (down 0.19%), edged lower from the Sensex pack.
Index heavyweight and cigarette major ITC slipped 2.36% to Rs 344.10. The stock hit high of Rs 352.40 and low of Rs 340.35 so far during the day.
Reliance Industries (RIL) rose 1.57% to Rs 955.90. The stock hit 52-week high of Rs 959 in intraday trade. Export Development Canada (EDC), Canada's leading financier and insurer of Canadian exporting companies, has announced $500 million in financing for RIL. The transaction is among the largest financing packages that EDC has ever extended in Asia, RIL said during trading hours today, 2 April 2014.
"We have been partnering with a wide section of Canadian suppliers for materials, equipment and services across our hydrocarbon businesses over the last 4-5 years and we are also engaging with them for our telecom business rollout. We have more than a decade-long relationship with EDC, and this landmark deal will provide further impetus to foster trade between RIL and Canadian companies over the coming years," said Srikanth Venkatachari, RIL's Joint Chief Financial Officer.
EDC provided the financing in response to the increasing business that RIL has been undertaking with Canadian companies since 2004, when EDC first became one of their financiers. The new financing package helps diversify RIL's funding sources and extends the maturity profile of its long-term debt in a cost effective manner, RIL said.
"RIL is a global leader in many sectors that match up well with Canadian industrial expertise, creating a natural partnership that benefits both of our priority interests. A strong relationship with EDC helps the RIL Group benefit from a global source of mature and dependable financing in a capital-constrained global economy. In turn, EDC introduces Canadian companies to RIL that not only meet their specific supply chain needs, but that can help them grow their global business. Everybody wins in this deal," said Rajesh Sharma, EDC's Senior Vice-President and Global Group Head, Business Development.
Meanwhile, RIL on Tuesday, 1 April 2014, said that the Supreme Court has appointed an international arbitrator in the KG D6 issue. Australia's Justice Mr. James Spigelman will be the third arbitrator and shall be the Chairman of the Arbitration Tribunal, RIL said. The Government of India had opposed the appointment of an international arbitrator, whereas RIL had submitted that the third arbitrator can be an International Arbitrator not being from India, Britain or Canada, where the three stakeholder companies are based. RIL has a 60% stake in the KG D6 block, Britain's BP has a 30% stake and Canada's Niko has a 10% stake.
India's Supreme Court has accepted RIL's argument and appointed Justice Mr. Spigelman, a former Chief Justice of New South Wales in Australia from 1998 to 2011. Poland-born Justice Spigelman has rich experience in the field of corporate affairs, insurance, arbitration and international law, the company said.
According to the Production Sharing Contract (PSC) signed between the Government of India and RIL, the Arbitration Tribunal must comprise three arbitrators. Of these, contractor (RIL, BP and Niko) and the Government of India are allowed to appoint one Arbitrator each, while the third arbitrator must be mutually appointed by both appointed arbitrators. However, the two appointed arbitrators were unable to reach an agreement on the appointment of the third arbitrator and hence RIL had to approach the Supreme Court, the company said.
With the constitution of the Arbitration Tribunal, the path has been cleared for a speedy resolution of various disputes relating to the KG D6 block, RIL said. The dispute arose when the recoverable gas from the field was found to be lesser than the initial estimates. Post this development, the central government had wrongfully sought to disallow recovery of full costs incurred by RIL in the block. As a result, RIL was compelled to proceed with arbitration. But since there was no consensus on the appointment of the third arbitrator, RIL had to approach the Supreme Court, the company said.
Both RIL and the Government of India are bound by the PSC. According to the PSC, any dispute between the parties can be resolved only through the process of arbitration. "We are hopeful that the constitution of the Arbitration Tribunal will silence the vested interest groups which are unreasonably raising this issue across the country," RIL said.
Sharon Bio-Medicine rose 1.67% to Rs 42.60 after the company announced during trading hours today that it has completed expansion in its 3 manufacturing facilities. The total investment in expansion has been incurred to the tune nearly Rs 125 crores. In Dehradun Formulation plant, the expanded expenditure has been appoximately Rs 85 crore whereas capacity of the plant has been increased more than double. Similarly, other plants' capacity has been added between 30% to 50%. The commercial production in Sharon two expanded plants at Taloja near Navi Mumbai have already been started and Dehradun Formulation expanded facility will start production from June 2014.
In the foreign exchange market, the rupee edged higher against the dollar as bunched-up dollar inflows and record high domestic shares aided sentiment. The partially convertible rupee was hovering at 59.645, compared with its close of 59.91/92 on Friday, 28 March 2014. Trading in the rupee resumed after a two-day break due to a local holiday and annual closing of bank accounts.
Indian government bond prices dropped on concern demand for existing securities will fall as the government starts its annual borrowing program this week. The yield on 10-year benchmark federal paper, 8.83% GS 2023, was hovering at 8.954%, higher than its close of 8.8035% on Friday, 28 March 2014. Trading in the government bond market resumed after a two-day break due to a local holiday and annual closing of bank accounts.
Reserve Bank of India Governor Raghuram Rajan said in an interview with a TV channel today, 2 April 2014, that a substantial strengthening of the rupee to 45 or 50 per dollar could hit exports, although he added the Reserve Bank of India was fine with "a certain amount of leeway" in the currency. Rajan also said that the RBI does not want to declare victory on inflation yet, despite keeping interest rates on hold on Tuesday, 1 April 2014, as widely expected. The RBI would rethink its stance if there is a "substantial" change of inflation, up or down, he said.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on Tuesday, 1 April 2014.
The next major trigger for the stock market is Q4 March 2014 and year ended 31 March 2014 (FY 2014) corporate earnings. Investors and analysts will closely watch the management commentary that would accompany the results to see if there is any revision in their future earnings forecast of the company for the year ending 31 March 2015 (FY 2015) and/or for the year ending 31 March 2016 (FY 2016). Indian companies will start reporting their Q4 and full year results from mid-April 2014. The result season will conclude in end-May 2014.
A major near term trigger for the stock market is the outcome of the upcoming Lok Sabha elections. Lok Sabha elections will be held between 7 April 2014 and 12 May 2014 in nine phases. The counting of votes will take place on 16 May 2014. The term of the current Lok Sabha expires on June 1 and the new House has to be constituted by May 31. Along with the Lok Sabha election, Andhra Pradesh (AP), including the regions comprising Telangana, Odisha and Sikkim will go to polls to elect new assemblies. AP, Odisha and Sikkim assemblies come to end on June 2, June 7 and May 7 respectively.
European stocks edged lower in early trade on Wednesday, 2 April 2014. Key benchmark indices in France and UK were off 0.03% to 0.11%. In Germany, the DAX index was up 0.15%.
A policy meeting of the Governing Council of the European Central Bank (ECB) will be held tomorrow, 3 April 2014, in Frankfurt to decide euro zone interest rates. ECB President Mario Draghi has consistently reassured listeners that the euro zone isn't heading for deflation, but that the central bank stands ready to act if needed.
Asian stocks rose on Wednesday, 2 April 2014, as increase in US manufacturing boosted optimism about growth in the world's biggest economy. Key benchmark indices in Hong Kong, South Korea, China, Japan and Taiwan were up 0.18% to 1.04%. However key benchmark indices in Singapore and Indonesia were down 0.09% to 0.14%.
Trading in US index futures indicated that the Dow could advance 17 points at the opening bell on Wednesday, 2 April 2014. US stocks rose on Tuesday, 1 April 2014, as consumer and technology shares pushed the Standard & Poor's 500 Index to an all-time high, after an increase in a manufacturing index boosted optimism the economy withstood severe winter weather.
US manufacturing companies expanded in March at a slightly faster pace compared to the prior month, a survey of executives found. The Institute for Supply Management manufacturing index edged up to 53.7%, slightly below the consensus forecasts. Any number over 50% means more companies are seeing an expansion of business instead of a contraction. Separately, the final Markit PMI for the US in March was unchanged at 55.5, down from 57.1 in February. Any reading over 50 in the purchasing managers index indicates growth.
US car sales surged to an annualized rate of 16.4 million in March the highest rate since November.
ADP is due to release US private-sector employment numbers for March 2014 today, 2 April 2014.
The influential US non-farms payroll data for March 2014 will be released this Friday, 4 April 2014.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 29-30 April 2014. The Federal Reserve on 19 March 2014 said after the conclusion of a monetary policy review that it will trim its monthly bond purchases by $10 billion to $55 billion. The Federal Reserve will end its bond-buying program before the end of the year with an interest-rate increase likely to follow in "around six months," Chair Janet Yellen said on 19 March 2014. Quarterly Fed forecasts on 19 March 2014 showed more officials predicting that the benchmark interest rate, now close to zero, will rise to at least 1% by the end of 2015 and 2.25% a year later.
Lawmakers in the US on Tuesday, 1 April 2014, endorsed an aid package for Ukraine.
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