Key benchmark indices moved into positive zone from negative zone in mid-morning trade as Asian stocks rose. The barometer index, the S&P BSE Sensex, was up 30.41 points or 0.14%, up about 110 points from the day's low and off close to 20 points from the day's high. The market breadth, indicating the overall health of the market, was positive.
Capital goods pivotals declined. Most auto stocks gained. Wipro reversed initial losses.
The Sensex edged lower amid initial volatility after a Reserve Bank of India panel recommended that the central bank should start using a consumer-price inflation target to determine monetary policy. High volatility was witnessed as key benchmark indices alternately swung between gains and losses in morning trade. Key benchmark indices moved into positive zone from negative zone in mid-morning trade as Asian stocks rose.
Foreign institutional investors (FIIs) sold shares worth a net Rs 43.74 crore on Tuesday, 21 January 2014, as per provisional data from the stock exchanges.
At 11:31 IST, the S&P BSE Sensex was up 30.41 points or 0.14% to 21,281.53. The index rose 49.78 points at the day's high of 21,300.90 in mid-morning trade. The index dropped 82.69 points at the day's low of 21,168.43 in early trade, its lowest level since 20 January 2014.
The CNX Nifty was up 9.05 points or 0.14% to 6,322.85. The index hit a high of 6,326.70 in intraday trade. The index hit a low of 6,287.45 in intraday trade, its lowest level since 20 January 2014.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,137 shares gained and 967 shares fell. A total of 130 shares were unchanged.
Among the 30-share Sensex pack, 22 stocks rose and rest fell. Bharti Airtel (up 1.84%), NTPC (up 1.53%) and Cipla (up 1.41%) edged higher from the Sensex pack.
Capital goods pivotals declined. L&T fell 0.65% amid choppy trade ahead of its Q3 results today, 22 January 2014. Bhel shed 0.03%.
Most auto stocks gained. Maruti Suzuki India rose 0.11%. M&M gained 0.43%.
Tata Motors rose 0.52%, with the stock extending Tuesday's gains. The company on Monday, 20 January 2014, announced the launch of the REVOTRON Series -- the next generation petrol engine family that will power its future models in the passenger vehicle market. The company unveiled the first petrol engine from its REVOTRON series - the Turbocharged Intercooled Multi-point Fuel Injected (MPFi) Petrol Engine, REVOTRON 1.2T. Tata Motors said that the REVOTRON Series has been designed based on extensive feedback from car owners, car enthusiasts and expert drivers from across the globe; observing their driving habits followed by extensive testing in gruelling climatic conditions in India as well as in countries like the UK and Korea.
The REVOTRON Series has been developed by Tata Motors with inputs from renowned global players in the area of combustion, boosting, friction and calibration, to deliver class-leading performance, the company said in a statement. Tata Motors also worked closely with global engine consultant AVL (Austria) and key technology partners like Bosch, Honeywell, Mahle and INA to bring in the latest technology for the new engine series. REVOTRON 1.2T has been tested for global standards along with a testing car by TEnergy of Korea to ensure that the engine performance is best-in-class, Tata Motors said. The engine has been manufactured to be light on weight and low on friction, delivering high performance and fuel economy. The REVOTRON series will include 3-and 4-cylinder petrol engines to offer superior performance as well as high fuel efficiency to our customers, Tata Motors said.
The REVOTRON 1.2T has been engineered to deliver optimum balance of power, performance and fuel economy, Tata Motors said. Developed using a range of eco-friendly and future-oriented technologies, the next-generation petrol engine incorporates latest know-how like multi-drive modes, allowing the best of economy and driving pleasure. The Advance Engine Management Systems (AMS) provides a digitally precise control for vehicle performance and emissions and offers the design of reciprocating components to ensure the best out of every drop of fuel. With enhanced customer benefits for the best driving experience, the REVOTRON series is therefore positioned to be a revolution in Performance, Refinement and Economy, the three pillars of the REVOTRON series, Tata Motors said.
Ashok Leyland rose 3.57%, with the stock shrugging off the company's weak Q3 results. The company reported a net loss of Rs 167.20 crore in Q3 December 2013, compared with a net profit of Rs 74.14 crore in Q3 December 2012. Total income fell 18.67% to Rs 1968.62 crore in Q3 December 2013 over Q3 December 2012. The company announced result after market hours on Tuesday, 21 January 2014.
Shares of two-wheeler makers were mostly lower. Hero MotoCorp (down 0.3%) and Bajaj Auto (down 0.29%) declined. TVS Motor Company rose 0.7%.
Wipro rose 0.87% to Rs 576.50. The stock hit 52-week high of Rs 579 in intraday trade. The stock hit a low of Rs 567 so far during the day. The stock turned ex-dividend today, 22 January 2014 for the interim dividend of Rs 3 per share for the year ending 31 March 2014.
Bond prices dropped after a Reserve Bank of India panel recommended that the central bank should start using a consumer-price inflation target to determine monetary policy. The panel's recommendations if accepted by the central bank may result in interest rates staying higher for long given the current high level of consumer price inflation in India. The yield on 10-year benchmark federal paper, 8.83% GS 2023, was hovering at 8.6615%, higher than its close of 8.5531% on Tuesday, 21 January 2014. Bond yield and bond prices move in opposite direction.
A Reserve Bank of India panel has recommended that the central bank should start using a consumer-price inflation target to determine monetary policy. The panelset up soon after former International Monetary Fund chief economist Raghuram Rajan took over as RBI governor last yearwas created to come up with ways to make the country's monetary policy more transparent and predictable. In a 130-page report released on Tuesday, 21 January 2014, the panel recommended using a well-defined range of consumer-price index inflation to set monetary policy. The report suggested a CPI inflation rate target within two percentage points above or below 4%. The RBI panel said the central bank should move to lower India's consumer inflation, which has been close to 10% in recent months, to 8% within the next 12 months and to 6% in 24 months, before adopting the target. "This transition path should be clearly communicated to the public," the report said.
If accepted, the report's recommendation would bring India in line with global norms by placing less emphasis on wholesale price inflation, which India has used until now as its main indicator of price movements. Historically, the Indian central bank has followed a multifocus approach to monetary policy, setting interest rates based on how it sees inflation, growth and currency stability. It usually didn't have an official inflation target, which often left markets surprised by its moves.
The panel also suggested monetary policy be decided by a committee headed by the governor with final decisions through a vote of the committee members, as is the practice in some developed countries like the UK. Right now in India monetary policy decisions are made by the RBI governor alone, though he gets input from an advisory committee.
The Reserve Bank of India's Third Quarter Review of Monetary Policy for 2013-14 is scheduled on 28 January 2014. The RBI kept its main lending rate viz. the repo rate unchanged after its last policy review in December and said at that time that it expected inflation to ease in the following months.
Asian stocks edged higher on Wednesday, 22 January 2014, after the Bank of Japan pledged to maintain economic stimulus and the International Monetary Fund raised its global growth forecast. Key benchmark indices in Japan, Singapore, South Korea, China, Taiwan and Hong Kong were up 0.01% to 1.88%. Indonesia's Jakarta Composite fell 0.12%.
The Bank of Japan (BOJ) today, 22 January 2014, pledged to maintain economic stimulus after a two-day monetary policy review. The BOJ said it will keep plans to increase the monetary base annually by 60 trillion to 70 trillion yen and maintained its inflation target for 2015.
The Thai government declared a state of emergency in its capital in response to antigovernment protests that have paralyzed the city and stirred up increasingly violent attacks. Over the past week, unknown assailants have launched attacks on the protesters, killing one and injuring dozens. The unrest is also dragging on the economy, with Japanese auto companies, some of Thailand's most important investors, raising a red flag that future investment could be affected.
Trading in US index futures indicated that the Dow could advance 10 points at the opening bell on Wednesday, 22 January 2014. US stocks closed mostly higher on Tuesday, 21 January 2014, though disappointing earnings results from Verizon Communications Inc and the Travelers Cos. Inc. weighed on the Dow. The S&P 500's cyclical sectors energy and natural resources were among the biggest gainers after the People's Bank of China on Tuesday, 21 January 2014, said it provided emergency funding support for commercial banks as they gear up to meet demands for cash ahead of the Lunar New Year.
The Federal Open Market Committee (FOMC) holds a two-day monetary policy meeting on 28 and 29 January 2014. By a 9-to-1 vote, the Fed on 18 December 2013 decided to trim its asset-purchase program by $10 billion to $75 billion per month starting in January 2014.
The International Monetary Fund raised its forecast for global growth this year as expansions in the US and UK accelerate, and urged advanced economies to maintain monetary accommodation to strengthen the recovery. The global economy will grow 3.7% this year, compared with an October estimate of 3.6%, the IMF said in revisions to its World Economic Outlook released in Washington.
US gross domestic product will expand 2.8%, compared with 2.6%; Japan will gain 1.7% versus 1.2%; and the UK will increase 2.4% from 1.9%, the report showed. "In advanced economies, output gaps generally remain large and, given the risks, the monetary policy stance should stay accommodative while fiscal consolidation continues," the Washington-based organization said in the report. "In many emerging market and developing economies, stronger external demand from advanced economies will lift growth, although domestic weaknesses remain a concern." Central banks in the US, Japan and the euro area face inflation levels under their targets while trying to accelerate growth with policies including benchmark interest rates near zero and bond-buying programs. While it raised the outlook for advanced nations, the IMF said "downside risks remain," including financial-market volatility in emerging markets.
Powered by Capital Market - Live News
