Sensex attains 2-1/2-week closing high

Oil, banks and FMCG stocks led gains for key benchmark indices today, 19 June 2015. Positive sentiment in European and Asian markets and rally in US stocks overnight boosted sentiment. Key benchmark indices hovered in positive zone throughout the trading session today, 19 June 2015. The barometer index, the S&P BSE Sensex settled at its highest level in 2-1/2-weeks. The 50-unit CNX Nifty settled at its highest level in more than two weeks. The Sensex rose 200.34 points or 0.74% to settle at 27,316.17. The market breadth indicating the overall health of the market was positive. In overseas markets, Asian and European stocks edged higher after a rally in US stocks overnight which materialized a day after the Federal Reserve signaled it would move more slowly on raising interest rates.

Bank stocks edged higher on renewed buying. Index heavyweights HDFC, ITC and Reliance Industries edged higher. Hindalco Industries edged higher after the Life Insurance Corporation of India (LIC) hiked its stake in the company to 13.337% from 11.328% in the last two months. L&T edged higher after the company said that its construction division has secured orders worth Rs 2278 crore across various business segments in May and June 2015. Shares of public sector oil marketing companies (PSU OMCs) edged higher. Shares of upstream oil exploration and production (E&P) firms also edged higher.

Key benchmark indices edged higher today, 19 June 2015, on expectations that above-average monsoon rain, data showing higher water storage in reservoirs and a restrained increase in minimum support prices for Kharif crops announced by the government on Wednesday, 17 June 2015, will improve the odds for further monetary policy easing from Reserve Bank of India (RBI). The RBI cut its main benchmark lending rate viz. the repo rate by 25 basis points after a monetary policy review on 2 June 2015. The central bank at that time said that the monsoon and its impact on food costs will be key to further easing. The June-September southwest monsoon is critical for the country's agriculture because a considerable part of the country's farmland is dependent on the rains for irrigation.

For the country as a whole, the cumulative rainfall during this year's monsoon season was 11% above the Long Period Average (LPA) until 17 June 2015.

Meanwhile, Finance Minister Arun Jaitley reportedly said in an interview to a newspaper in the United States yesterday, 18 June 2015, that important changes are being made in government policies every week.

Meanwhile, the government has reportedly issued a draft paper yesterday, 18 June 2015, on a proposal to issue sovereign gold bonds in a bid to reduce the demand for physical gold.

Foreign portfolio investors (FPIs) sold shares worth a net Rs 784.73 crore yesterday, 18 June 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 1110.01 crore yesterday, 18 June 2015, as per provisional data released by the stock exchanges.

In overseas stock markets, Asian and European stocks edged higher after a rally in US stocks overnight which materialized a day after the Federal Reserve signaled it would move more slowly on raising interest rates. US stocks advanced sharply yesterday, 18 June 2015, sending the Nasdaq Composite and the Russell 2000 to record highs, while the main indexes recorded their third consecutive day of gains.

The S&P BSE Sensex rose 200.34 points or 0.74% to settle at 27,316.17, its highest closing level since 1 June 2015. The index jumped 288.77 points at the day's high of 27,404.60 in late trade. The index rose 86.55 points at the day's low of 27,202.38 in early trade.

The CNX Nifty rose 50.35 points or 0.62% to settle at 8,224.95, its highest closing level since 2 June 2015. The index hit a high of 8,250.80 in intraday trade. The index hit a low of 8,195.65 in intraday trade.

The BSE Mid-Cap index rose 59.96 points or 0.58% to settle at 10,487.12. The BSE Small-Cap index rose 31.09 points or 0.28% to settle at 10,942.79. Both these indices underperformed the Sensex.

The market breadth indicating the overall health of the market was positive. On BSE, 1,434 shares rose and 1,230 shares fell. A total of 150 shares were unchanged.

The total turnover on BSE amounted to Rs 3533 crore, higher than turnover of Rs 3001.13 crore registered during the previous trading session.

Among the sectoral indices on BSE, the S&P BSE FMCG index (up 0.75%), BSE Bankex index (up 0.86%) and BSE Oil & Gas index () outperformed the Sensex. The S&P BSE Healthcare index (up 0.24%), BSE IT index (up 0.29%), BSE Auto index (up 0.6%), BSE Capital Goods index (up 0.32%), BSE Consumer Durables index (down 0.13%), BSE Metal index (up 0.45%), BSE Power index (down 0.22%), BSE Realty index (down 0.75%) and BSE Teck index (up 0.39%) underperformed the Sensex.

Index heavyweight and housing finance major HDFC rose 2.29% at Rs 1,237.45. The stock hit a high of Rs 1,246.85 and a low of Rs 1,219.90 in intraday trade.

Another index heavyweight and cigarette major ITC rose 1.29% at Rs 305.15. The stock hit a high of Rs 306 and a low of Rs 302.60 in intraday trade.

Reliance Industries (RIL) rose 1.78% at Rs 996.50. The stock hit a high of Rs 1,006 and a low of Rs 983 in intraday trade.

Shares of public sector oil marketing companies (PSU OMCs) edged higher. BPCL (up 0.32%), HPCL (up 2.63%) and Indian Oil Corporation (up 1.72%) edged higher.

Shares of upstream oil exploration and production (E&P) firms edged higher. Oil India (up 1.01%), ONGC (up 2.02%), Cairn India (up 0.67%) and Reliance Industries (up 1.76%) edged higher.

Bank stocks edged higher on renewed buying. Among public sector banks, UCO Bank (up 3.11%), Corporation Bank (up 0.49%), Central Bank of India (up 2.71%), State Bank of India (up 0.81%), IDBI Bank (up 0.4%), Punjab National Bank (up 1.29%), Bank of Baroda (up 2.04%) and Union Bank of India (up 0.14%) edged higher. Syndicate Bank (down 0.05%) and United Bank of India (down 0.21%) edged lower.

Bank of Maharashtra dropped as the stock turned ex-dividend today, 19 June 2015 for dividend of Rs 0.80 per share for the year ended 31 March 2015. The stock dropped 1.9% at Rs 36.20.

Among private sector banks, Kotak Mahindra Bank (up 1.4%), IndusInd Bank (up 1.21%), ICICI Bank (up 0.45%), Axis Bank (up 0.43%) and HDFC Bank (up 1.46%) edged higher.

Yes Bank rose 1.46% at Rs 1,034. The stock hit a high of Rs 835 and a low of Rs 822.15 in intraday trade. Yes Bank during market hours today, 19 June 2015, said that in furtherance of the results declared at the 11th Annual General Meeting (AGM) held on 6 June 2015, two directors on the board of Yes Bank, namely Mr. M. R. Srinivasan and Mr. Diwan Arun Nanda, will be assuming office from today, 19 June 2015. All relevant filings with other regulatory authorities confirming the same will be made in due course, Yes Bank said.

L&T edged higher after the company said that its construction division has secured orders worth Rs 2278 crore across various business segments in May and June 2015. The stock rose 0.33% at Rs 1,719.15. The announcement was made during market hours today, 19 June 2015.

Hindalco Industries edged higher after the Life Insurance Corporation of India (LIC) hiked its stake in the company to 13.337% from 11.328% in the last two months. The stock rose 0.37% at Rs 120.55. LIC in a disclosure to the NSE after market hours yesterday, 18 June 2015, said that it had hiked its stake in Hindalco Industries to 13.337% from 11.328% during the period from 16 April 2015 to 17 June 2015 through open market purchases.

Tata Steel rose 0.4% at Rs 304.80. With regard to news item titled "Steel cos slug it out for Odisha's chrome", Tata Steel said in its clarification issued during market hours today, 19 June 2015 that the Government of Odisha had on 1 December 2014 issued the Express Order for 3rd Renewal of the Sukinda Chromite Mine for 20 years. Subsequent to the introduction of the new MMDR Act 2015, the Government of Odisha needs to take the decision for extending the validity of this mine lease under this Act, Tata Steel said. The company is engaged in discussions with the Government of Odisha on the same, Tata Steel said.

Meanwhile, Finance Minister Arun Jaitley reportedly said in an interview to a newspaper in the United States yesterday, 18 June 2015, that important changes are being made in government policies every week. Jaitley said that overhauls are moving ahead at a rapid pace and there's a lot of agenda still to cover. Jaitley said the government is looking for compromises that would speed up passage of a new law aimed at easing the acquisition of land for development projects. Jaitley said the tax notices to foreign institutional investors (FIIs) demanding payment of the minimum alternate tax (MAT) were a legacy of 2012 litigation and would be reviewed by the Supreme Court. Once the Supreme Court judgment comes, the MAT issue will get sorted out, he said. Jaitley is currently on a 9-day official visit to the United States.

Meanwhile, the government has reportedly issued a draft paper yesterday, 18 June 2015, on a proposal to issue sovereign gold bonds in a bid to reduce the demand for physical gold. The sovereign gold bond will offer a minimum interest of 2% per annum. The bonds would be issued in denominations of two, five and 10 grams of gold or other sizes for a minimum term of five to seven years and they can be used as collateral for loans. Capital gains tax on the bond will be similar to that imposed on physical gold purchases. For easy and wide access, the government plans to market the bond through post offices and various brokers and agents. The Reserve Bank of India (RBI) will issue sovereign bonds on behalf of the Indian government. The government has reportedly invited public comments on the draft paper by 2 July 2015.

Meanwhile, the India Meteorological Department (IMD) said in its daily monsoon update issued yesterday, 18 June 2015, that the Southwest Monsoon was vigorous over Coastal Andhra Pradesh and active over Sub-Himalayan West Bengal & Sikkim, Konkan & Goa, Vidarbha and Telangana during past 24 hours ending at 0830 hrs. Conditions are favourable for further advance of southwest monsoon into some more parts of Chhattisgarh, Odisha and West Bengal and remaining parts of Coastal Andhra Pradesh and Bay of Bengal during next 2-3 days, the IMD said.

For the country as a whole, the cumulative rainfall during this year's monsoon season was 11% above the Long Period Average (LPA) until 17 June 2015. Region wise, the southwest monsoon was 19% above the LPA in Central India, 16% above the LPA in East & Northeast India and 7% below the LPA in Northwest India until 17 June 2015. The rainfall was 100% of the Long Period Average in South Peninsula.

In a separate weekly monsoon report, the IMD said that the rainfall activity is expected to increase over Odisha, Andhra Pradesh, Karnataka and parts of Maharashtra till 20 June. During 21-25 June, rainfall is expected to increase over many parts of central and adjoining eastern and northwestern parts of the country. Thereafter, during 26-30 June, rainfall is likely to increase over Indo-Gangetic plains and northwest India. IMD said that its forecasting models are suggesting an overall decrease in monsoon rainfall over most parts of the country in the beginning of July.

The June-September southwest monsoon is critical for the country's agriculture because a considerable part of the country's farmland is dependent on the rains for irrigation.

Meanwhile, the Ministry of Water Resources today, 19 June 2015, announced that the water storage available in 91 important reservoirs of the country as on 18 June 2015 was 39.05 BCM which is 25% of total storage capacity of these reservoirs. This storage is 103% of the storage of corresponding period of last year and 139% of storage of average of last ten years. The present storage position during current year is better than the storage position of last year and is also better than the storage of average of last ten years.

States having better storage than last year for corresponding period are Himachal Pradesh, Punjab, Odisha, Tripura, Uttar Pradesh, Karnataka, Kerala and Tamil Nadu. States having lesser storage than last year for corresponding period are Rajasthan, Jharkhand, West Bengal, Gujarat, Maharashtra, Madhya Pradesh, Chhattisgarh, Andhra Pradesh, Telangana. Uttarakhand is having equal storage as compared to the storage capacity for corresponding period last year.

In overseas stock markets, European stocks edged higher today, 19 June 2015, after a rally in US stocks overnight which materialized a day after the Federal Reserve signaled it would move more slowly on raising interest rates. Key indices in Germany, UK and France were up 0.5% to 1.21%.

Investors continue to monitor development in Greece after the Eurogroup of eurozone finance ministers concluded a closely watched meeting yesterday, 18 June 2015, without a deal to unlock financial aid to the debt-laden country. After the talks collapsed, the EU called an emergency summit of leaders for Monday, 22 June 2015, to urgently discuss the situation of Greece. Greece is still struggling to reach a reform agreement with its lenders, which would unlock the next portion of bailout money needed to repay 1.6 billion euros ($1.82 billion) to IMF by the end of June.

Asian stocks edged higher today, 19 June 2015, after a rally in US stocks overnight which materialized a day after the Federal Reserve signaled it would move more slowly on raising interest rates. Key indices in Hong Kong, Singapore, South Korea and Indonesia were up 0.08% to 0.8%. Taiwan stock market was shut for a holiday.

In China, the Shanghai Composite was off 6.36%, amid fears of a bubble in China's volatile equity markets. Investors have been spooked by selling in highflying Chinese startups.

The Bank of Japan today, 19 June 2015, said it would stick with its record 80 trillion yen annual asset-buying scheme that is aimed at jacking up prices and kick-starting growth. The Japanese central bank also said it would move to improve its communication by issuing more frequent and detailed reports on its economic outlook, while cutting the number of policy meetings to eight from the current 14 a year.

US stocks advanced sharply yesterday, 18 June 2015, sending the Nasdaq Composite and the Russell 2000 to record highs, while the main indexes recorded their third consecutive day of gains. Investors continued to cheer what they perceived as a dovish tone set by the US central bank and Chairwoman Janet Yellen following the conclusion of a two-day Fed policy meeting on Wednesday, 17 June 2015.

US consumers saw an increase in price pressures in May, rising for the fourth straight month, according to the latest data from the Department of Labor released yesterday, 18 June 2015. Consumer price index rose 0.4% on a seasonally adjusted basis last month, compared to April's rise of 0.1%.

Meanwhile , the first-time weekly jobless claims in the US fell by 12,000 claims to a seasonally adjusted 267,000 during the week ending 6th June, the Labor Department said yesterday, 18 June 2015. Continuing jobless claims, the number of people already receiving benefits and reported with a one-week delay, fell by 50,000 claims to a seasonally adjusted 2.22 million during the week ending 6th June.

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