Further gains took key benchmark indices to fresh record high in mid-afternoon trade. The barometer index, the S&P BSE Sensex, hovered above the psychological 27,000 mark after crossing that level for the first time in its history in afternoon trade. The Sensex was currently up 181.08 points or 0.67% at 27,048.63. The market breadth indicating the overall health of the market was strong. The market sentiment was boosted by provisional data showing that foreign funds were net buyers of Indian stocks during the previous trading session. A decline in crude oil prices added to positive sentiment on the domestic bourses. India imports about 80% of its crude oil requirement.
Telecom stocks surged. Maruti Suzuki India advanced after the company said it will open customer bookings for the much awaited mid-sized premium sedan Ciaz from tomorrow, 3 September 2014. Rural Electrification Corporation dropped on turning ex-dividend today, 2 September 2014. GMR Infrastructure rose after the company signed a memorandum of understanding (MoU) with Japan Bank for International Cooperation for providing financial assistance to Japanese companies investing in infrastructure projects of GMR Group.
On the macro front, the current account deficit (CAD) narrowed on year-on-year basis but rose on sequential basis in Q1 June 2014. Meanwhile, Japan has promised 3.5 trillion yen of public and private investment and financing, including Overseas Development Assistance (ODA) over five years for India's development.
Key indices have remained in green so far during the day after opening a tad higher.
In overseas markets, European stocks rose amid speculation that slower growth in euro zone will prompt European Central Bank (ECB) to accelerate stimulus. Stocks in mainland China and Japan surged amid a mixed trend in Asian stocks.
At 14:14 IST, the Sensex was up 181.08 points or 0.67% at 27,048.63. The index jumped 215.30 points at the day's high of 27,082.85 in mid-afternoon trade, a lifetime high for the index. The index rose 18.67 points at the day's low of 26,886.22 in early trade.
The CNX Nifty was up 66.90 points or 0.83% at 8,094.60. The index hit a high of 8,101.95 in intraday trade, a lifetime high for the index. The index hit a low of 8,036.55 in intraday trade.
The market breadth indicating the overall health of the market was strong. On BSE, 1,773 shares gained and 1,082 shares fell. A total of 125 shares were unchanged.
The BSE Mid-Cap index was up 91.94 points or 0.97%% at 9,536.53. The BSE Small-Cap index was up 119.21 points or 1.15% at 10,516.80. Both these indices outperformed the Sensex.
Telecom stocks gained. Bharti Airtel (up 4.51%), Idea Cellular (up 4.06%), MTNL (up 2.55%), Reliance Communications (up 2.03%) and Tata Teleservices (Maharashtra) (up 1.51%) edged higher.
Maruti Suzuki India rose 0.44% after the company during market hours said it will open customer bookings for the much awaited mid-sized premium sedan Ciaz from tomorrow, 3 September 2014 across its nationwide network. Ciaz will be available in petrol and diesel fuel options. The global launch of Ciaz is planned during the forthcoming festival season, Maruti said.
GMR Infrastructure rose 2.33% after the company said it has signed a memorandum of understanding (MoU) today, 2 September 2014, with Japan Bank for International Cooperation (JBIC) for providing financial assistance to Japanese companies investing in infrastructure projects of GMR Group. The objective of this MoU is to provide low cost long duration financing for infrastructure development projects that involve Japanese companies in development of industrial parks, power, energy, ports, airports, highways, and railway projects, GMR Infra said in a statement.
Alstom T&D India lost 0.25%. The company during market hours said it has secured a euro 7 million (Rs 55 crore) contract from Mangdechhu Hydroelectric Project Authority (MHPA) to supply power transformers for the 720 megawatts Mangdechhu Hydroelectric Project. Located by the river Mangdechhu in Bhutan, the project is a major landmark in grid development for hydro power in Bhutan, Alstom T&D India said in a statement.
Rural Electrification Corporation (REC) dropped 1.83% as the stock turned ex-dividend today, 2 September 2014, for a final dividend of Rs 1.75 per share for the year ended 31 March 2014.
The sentiment on the bourses was boosted by provisional data showing that foreign funds were net buyers of Indian stocks during the previous trading session. Foreign portfolio investors (FPIs) bought shares worth a net Rs 554.14 crore yesterday, 1 September 2014, as per provisional data from the stock exchanges.
A decline in crude oil prices added to positive sentiment on the domestic bourses. India imports about 80% of its crude oil requirement. Brent crude prices fell on concerns of slowing oil demand growth due to weak economic recoveries in China and Europe. Brent crude for October delivery was off 80 cents at $101.99 a barrel.
In the foreign exchange market, the rupee was a tad lower against the dollar. The partially convertible rupee was hovering at 60.54, compared with its close of 60.525 during the previous trading session.
Japanese Prime Minister Shinzo Abe yesterday, 1 September 2014, expressed his intention to realize 3.5 trillion yen of public and private investment and financing from Japan, including Overseas Development Assistance (ODA) to India in five years, to finance appropriate public and private projects of mutual interest including in the areas of next generation infrastructure, connectivity, transport systems, Smart Cities, rejuvenation of Ganga and other rivers, manufacturing, clean energy, skill development, water security, food processing and agro industry, agricultural cold chain, and rural development. This was stated in a joint statement issued yesterday, 1 September 2014, after a meeting between Prime Minister Narendra Modi and Abe. Modi is currently on a five-day visit to Japan. The Prime Ministers of the two countries have decided to set a target of doubling Japan's foreign direct investment and the number of Japanese companies in India within five years as an objective to be jointly achieved.
In macroeconomic data, the output of eight core sector industries rose 2.7% in July 2014, showing moderation from a growth of 7.3% in June 2014. However, the cumulative growth has remained steady at 4.1% in April-July 2014 over April-July 2013. The data was announced after market hours on Monday, 1 September 2014.
India's current account deficit (CAD) narrowed sharply to $7.8 billion or 1.7% of GDP in Q1 June 2014, from $21.8 billion or 4.8% of GDP in Q1 June 2013. The lower CAD was primarily on account of a contraction in the trade deficit contributed by a rise in exports and a decline in imports. On sequential basis, the CAD rose from $1.2 billion or 0.2% of GDP in Q4 March 2014.
The preliminary data on India's balance of payments (BoP) also showed that foreign direct investment (FDI) in India rose to $8.2 billion in Q1 June 2014, from $6.5 billion in Q1 June 2013. The data was announced after market hours on Monday, 1 September 2014.
European stocks rose today, 2 September 2014, amid speculation that slower growth in euro zone will prompt European Central Bank (ECB) to accelerate stimulus. Key benchmark indices in UK, France and Germany were up 0.34% to 0.71%.
ECB President Mario Draghi signaled last month that ECB policy makers are ready to increase stimulus to combat low inflation in the euro area.
Asian stocks were mixed today, 2 September 2014. Key benchmark indices in Singapore and Indonesia were up 0.38% to 0.46%. Key benchmark indices in Hong Kong, Taiwan and South Korea were off 0.01% to 1.19%.
Stocks in mailand China rose led by defense and technology companies, amid speculation the government will increase military spending as part of its efforts to bolster economic growth. The Shanghai Composite index jumped 1.37%
Japanese stocks surged as the yen weakened against the dollar before Prime Minister Shinzo Abe announces a new cabinet tomorrow, 3 September 2014. The Nikkei 225 average jumped 1.24%.
Trading in US index futures indicated that the Dow could gain 43 points at the opening bell on Tuesday, 2 September 2014. US stock markets were closed on Monday, 1 September 2014 for Labor Day holiday.
According to reports, the Russian officials pressed Ukraine on Monday, 1 September 2014, to declare a cease-fire with separatists, but Ukrainians say they are locked in a war not just against the rebels but also against Russia on behalf of Europe. Ukraine and its Western allies have surmised that Russian forces are significantly aiding pro-Russian separatists.
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