Sensex, Nifty trim gain after hitting record high

After hitting fresh intraday high in morning trade, key benchmark indices pared gains in mid-morning trade. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, pared gains after hitting record high. The Sensex was currently up 54.72 points or 0.19% at 28,232.60. The market breadth indicating the overall health of the market was strong.

Foreign portfolio investors (FPIs) bought shares worth a net Rs 656.37 crore yesterday, 17 November 2014, as per provisional data. Finance Minister Arun Jaitley yesterday, 17 November 2014, said that he is in touch with the various state governments and most of the contentious issues on the implementation of the Goods and Service Tax (GST) have already been resolved. Jaitley said that the targets fixed for disinvestment in the current financial year are quite ambitious one but he hopes to achieve that or reach near the same.

Metals shares were in demand. Banks stocks were mostly higher. Punj Lloyd jumped after winning a new contract.

In overseas markets, Japanese stocks led gains in Asian stocks following reports that Japanese Prime Minister Shinzo Abe will today, 18 November 2014, announce plans to put off a sales-tax increase and call an election after data yesterday, 17 November 2014, showed the Japanese economy entered recession.

In the foreign exchange market, the rupee edged lower against the dollar on broad strength for the dollar.

Brent crude futures fell as investors weighed the likelihood of an output cut by OPEC when the group meets next week amid signs of weakening global demand.

At 11:30 IST, the S&P BSE Sensex was up 54.72 points or 0.19% at 28,232.60. The index jumped 104.97 points at the day's high of 28,282.85 in mid-morning trade, a record high for the index. The index fell 0.58 points at the day's low of 28,177.30 in early trade.

The CNX Nifty was up 8.55 points or 0.10% at 8,439.30. The index hit a high of 8,454.50 in intraday trade, a record high for the index. The index hit a low of 8,422.55 in intraday trade.

The market breadth indicating the overall health of the market was strong. On BSE, 1,584 shares gained and 981 shares fell. A total of 86 shares were unchanged.

The BSE Mid-Cap index was up 58.51 points or 0.57% at 10,306.21 The BSE Small-Cap index was up 104.90 points or 0.93% at 11,442.86. Both these indices outperformed the Sensex.

Metals shares were in demand. Sesa Sterlite (up 3.37%), Steel Authority of India (Sail) (up 2.58%), JSW Steel (up 1.86%), Hindustan Zinc (up 1.54%), Tata Steel (up 1.54%), Jindal Steel & Power (up 1.33%), NMDC (up 0.46%), Hindalco Industries (up 0.41%) and Bhushan Steel (up 0.24%), edged higher.

Bank shares were mostly higher. Among public sector banks, Punjab National Bank (up 2.88%), IDBI Bank (up 2.39%), Union Bank of India (up 1.72%), Canara Bank (up 1.67%), Bank of India (up 1.39%), State Bank of India (up 0.85%) and Bank of Baroda (up 0.25%) edged higher.

Among private sector banks, HDFC Bank (up 0.65%), Axis Bank (up 0.48%), Yes Bank (up 0.44%), ICICI Bank (up 0.38%) and Federal Bank (up 0.07%), edged higher. IndusInd Bank (down 0.10%) and Kotak Mahindra Bank (down 0.11%) edged lower.

Punj Lloyd jumped 6.54% after the company said it has secured EPC highway contract worth Rs 666 crore from the Ministry of Road Transport & Highways for 90.586 kilometers of the Asian Highway network. The company made the announcement during market hours today, 18 November 2014.

Financial Technologies (India) (FTIL) jumped 4.67% after the company after market hours yesterday, 17 November 2014, said that the board of FT Group Investments Mauritius (FTGIPL), a wholly owned subsidiary of FTIL yesterday, 17 November 2014, approved the sale of 100% of its stake in Bourse Africa, Mauritius (together with its wholly owned subsidiary Bourse Africa Clear) to Continental Africa Holdings (CAHL), Mauritius, for $40.5 million. The entire transaction is expected to be completed within the next 210 days, FTIL said.

In the foreign exchange market, the rupee edged lower against the dollar on broad strength for the dollar. The partially convertible rupee was hovering at 61.80, compared with its close of 61.74 during the previous trading session.

Brent crude futures fell as investors weighed the likelihood of an output cut by OPEC when the group meets next week amid signs of weakening global demand. Brent for January settlement was off 40 cents to $78.91 a barrel. The contract had lost 10 cents to settle at $79.31 yesterday, 17 November 2014.

Oil ministers from the Organization of the Petroleum Exporting Countries (OPEC) are scheduled to meet in Vienna on 27 November 2014 to consider whether to adjust their output target of 30 million barrels per day (bpd) for early 2015.

Finance Minister Arun Jaitley yesterday, 17 November 2014, said that he is in touch with the various state governments and most of the contentious issues on the implementation of the Goods and Service Tax (GST) have already been resolved. The Finance Minister was delivering the Key Note Address at the Citi's Investor Summit: India - Poised for Higher Growth. Jaitley said there are two areas including liquor and petroleum products where the state governments want to have taxation authority. Jaitley said two state governments want entry tax and octroi to be kept-out of the purview of the GST. The Finance Minster said that all these issues will be sorted-out soon. Jaitley said he will apprise the Empowered Committee of State Finance Ministers' about the draft Constitution Amendment Bill on GST before introducing the same in parliament. Jaitley said that the targets fixed for disinvestment in the current financial year are quite ambitious one but he hopes to achieve that or reach near the same. He said that road shows in this regard are being held in many parts of the world.

The Finance Minister said that inflation, especially food inflation has moderated in last few months and global fuel prices have also come down. Therefore, if RBI which is highly professional organization in its wisdom decides to bring down the cost of capital, it will give a good fillip to the Indian economy, Jaitley said.

The Reserve Bank of India (RBI) next undertakes monetary policy review on 2 December 2014. The central bank aims to limit consumer-price gains to 8% by January 2015 and 6% by January 2016. Over the longer term, the RBI aims to limit consumer-price gains to 4%, within a 2% band. The annual rate of inflation based on the combined consumer price index (CPI) for urban and rural India eased to 5.52% in October 2014 from 6.46% in September 2014, data released by the government on 12 November 2014 showed.

Meanwhile, a joint statement issued today, 18 November 2014, during Prime Minister Narendra Modi's official visit to Australia from 16-18 November 2014 stated that Australian Prime Minister Tony Abbott and Modi agreed to expedite progress towards early conclusion of the administrative arrangements to implement the Civil Nuclear Agreement signed between Australia and India during Abbott's visit to India in September. Australian supply of uranium in coming years will enhance India's energy security, the joint statement stated.

Japanese stocks led gains in Asian stocks today, 18 November 2014, on reports that Japanese Prime Minister Shinzo Abe will today, 18 November 2014, announce plans to put off a sales-tax increase and call an election after data yesterday, 17 November 2014, showed the Japanese economy entered recession. Key benchmark indices in Japan, Indonesia, Singapore, South Korea and were up 0.39% to 2.10%. Key benchmark indices in China, Hong Kong and Taiwan were off 0.40% to 0.98%.

Deputy policy chief of Japan's ruling Liberal Democratic Party reportedly said that the Japanese government will order the creation of an economic stimulus package.

Trading in US index futures indicated that the Dow could fall 3 points at the opening bell today, 18 November 2014. Most US stocks ended higher yesterday, 17 November 2014, as deal activity worth $100 billion and hopes of more European stimulus offset concerns about overseas growth after Japan's economy slipped into recession.

In Europe, European Central Bank President Mario Draghi explicitly cited government-bond buying as a policy tool officials could use to stimulate the economy if the outlook worsens. He was speaking during quarterly testimony to lawmakers at the European Parliament yesterday, 17 November 2014.

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