Key benchmark indices hovered in positive zone in mid-morning trade. The S&P BSE Sensex was up 147.94 points or 0.76%, off 81.49 points from the day's high and up 26.65 points from the day's low. The market breadth, indicating the overall health of the market, was strong. Firm Asian stocks and a surge in US index futures indicating a strong opening of US markets underpinned sentiment.
Index heavyweight and cigarette major ITC hovered in positive zone. Reliance Industries extended intraday gain. Shares of FMCG giant Hindustan Unilever (HUL) scaled a record high after Anglo-Dutch parent Unilever on Thursday, 4 July 2013, said it has raised its stake in HUL to 67.28% from 52.48% through a voluntary open offer for HUL shareholders. UB group shares gained after United Spirits said that Diageo has completed the acquisition of additional 14.98% stake in United Spirits. Bank stocks rose across the board on renewed buying.
Key benchmark indices edged higher in early trade on firm Asian stocks. The barometer index, S&P BSE Sensex, hit four-week high. Key benchmark indices pared gains in morning trade. Key benchmark indices hovered in positive zone in mid-morning trade.
Foreign institutional investors (FIIs) bought shares worth a net Rs 164.56 crore on Thursday, 4 July 2013, as per provisional data from the stock exchanges.
At 11:20 IST, the S&P BSE Sensex was up 147.94 points or 0.76% to 19,558.78. The index jumped 229.43 points at the day's high of 19,640.27 in early trade, its highest level since 7 June 2013. The index rose 121.29 points at the day's low of 19,532.13 in morning trade.
The CNX Nifty was up 43.80 points or 0.75% to 5,880.75. The index hit a high of 5,900.45 in intraday trade, its highest level since 1 July 2013. The index hit a low of 5,872.35 in intraday trade.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1,176 shares gained and 641 shares fell. A total of 124 shares were unchanged.
The total turnover on BSE amounted to Rs 523 crore by 11:20 IST compared to Rs 336 crore by 10:20 IST.
Among the 30-share Sensex pack, 24 shares gained while rest of them declined.
Reliance Industries (RIL) rose 2.13% to Rs 880, with the stock extending intraday gain. The stock hit a high of Rs 882 and low of Rs 865.35 so far during the day. The government on 27 June 2013 agreed to double natural gas prices to industrial and retail consumers to help fund investment in exploration and reverse declining domestic gas output. The price of gas could go up to $8.4 per million metric British thermal units (mmBtu), effective 1 April next year, from current $4.2 mmBtu.
FMCG giant Hindustan Unilever (HUL) gained 1.34% to Rs 608.80 after scaling a record high of Rs 631.95 in intraday trade today, 5 July 2013. Unilever's shareholding in Hindustan Unilever has increased from 52.48% through a voluntary open offer for HUL shareholders. Anglo-Dutch consumer goods major Unilever had floated an open offer to raise its stake to 75% in Indian unit at Rs 600 per share. The offer opened on 21 June 2013 and closed on 4 July 2013.
Bank stocks rose across the board on renewed buying. Among private sector banks, HDFC Bank (up 1.71%), Yes Bank (up 0.16%), ICICI Bank (up 0.09%), Kotak Mahindra Bank (up 0.5%), edged higher.
Axis Bank advanced 2.15%. The stock turned ex-dividend today, 5 July 2013, for dividend of Rs 18 per share for the year ended 31 March 2013 (FY 2013).
Among PSU bank stocks, State Bank of India (up 0.66%), Union Bank of India (up 0.89%), Punjab National Bank (up 1.48%) and Bank of Baroda (up 1.9%) gained.
Canara Bank rose 1.3%. The state-run bank after market hours on Thursday, 4 July 2013, said it has reduced the base rate by 30 basis points (bps) from 10.25% to 9.95% for all loans/advances viz. agriculture, MSME sector, retail, export credit with effect from 8 July 2013. The bank has also reduced rate of interest on deposits on few maturity slabs.
Bank of India rose 1.49%. The bank on 3 July 2013 said it has decided to reduce its base rate from the existing 10.25% per annum to 10% per annum with effect from 8 July 2013.
The Reserve Bank of India (RBI) on Tuesday, 2 July 2013, issued draft guidelines that would require banks to make higher provisions and increase risk weights on exposure to companies that have unhedged foreign-currency exposure. Starting 1 October 2013, banks will have to monitor unhedged foreign currency exposure of borrowers at monthly intervals.
The draft guidelines advised banks to ensure that their policies and procedures for management of credit risk factor their exposure to currency-induced credit risks and are calibrated towards borrowers whose capacity to repay is sensitive to changes in the exchange rate and other market variables.
UB group shares gained after United Spirits said that Diageo has completed the acquisition of additional 14.98% stake in United Spirits. United Breweries group shares gained. United Spirits (USL) rose 2.1% to Rs 2,609.95 after striking a record high of Rs 2,625.95 in intraday trade today, 5 July 2013. United Breweries (Holdings) was locked at 10% upper circuit. Kingfisher Airlines was locked in 10% upper circuit filter. United Breweries rose 1.51%.
USL after market hours on Thursday, 4 July 2013, said that Diageo has completed the acquisition of a 14.98% stake in USL at Rs 1,440 per share. The shares were bought from United Breweries (Holdings) and other UB group companies. Following the acquisition, Diageo holds 25.02% stake in USL. Diageo and the UB Group are now co-promoters of USL.
Asian markets edged higher on Friday, 5 July 2013, after the two most important central banks in Europe on Thursday, 4 July 2013, said after monetary policy review that they are in no hurry to wind down stimulus. Key benchmark indices in China, Hong Kong, Indonesia, Singapore and Japan were up 0.35% to 1.8%. South Korea's KOSPI Composite fell 0.3%.
Trading in US index futures indicated that the Dow could gain 133 points at the opening bell on Friday, 5 July 2013. The US government will unveil the influential nonfarm payrolls data for June 2013 today, 5 July 2013, which the Federal Reserve is monitoring as it decides when it will slow the pace of its bond purchases. Fed Chairman Ben Bernanke said last month that bond purchases, currently at $85 billion a month, may be tapered down this year if the economy improves in line with the central bank's projections. The Fed is looking for the unemployment rate to fall toward 6.5% by next year.
The European Central Bank (ECB), as expected, kept its main lending rate at a record low 0.5% on Thursday, the same level it's been at since it was cut from 0.75% back in May. ECB president Mario Draghi said rates wouldn't rise for "an extended period."
The Bank of England (BOE) decided to keep its key lending rate at a record low 0.5% and to leave the size of its bond-buying program unchanged at 375 billion pounds ($572 billion). The Bank of England on Thursday signaled it won't be raising interest rates anytime soon, saying in a statement that the recovery is on track but it "remains weak by historical standards and a degree of slack is expected to persist for some time."
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