Volatility continued in morning trade as key benchmark alternately swung between positive and negative zone. The S&P BSE Sensex was down currently down 13.23 points or 0.06%, up 56.77 points from the day's low and off 76 points from the day's high. The market breadth, indicating the overall health of the market was positive.
Index heavyweight and cigarette major ITC reversed initial gains in volatile trade. Another index heavyweight Reliance Industries also reversed initial gains in volatile trade. ACC and Ambuja Cements dropped after announcing Q1 results on Thursday, 24 April 2014.
High volatility was witnessed as the barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit record high at the onset of the trading session. Volatility continued in morning trade as key benchmark alternately swung between positive and negative zone.
Foreign institutional investors (FIIs) bought shares worth a net Rs 767.61 crore on Wednesday, 23 April 2014, as per provisional data from the stock exchanges. The stock market was closed on Thursday, 24 April 2014, on account of Parliamentary elections in Mumbai constituency.
At 10:18 IST, the S&P BSE Sensex was down 13.23 points or 0.06% to 22,863.31. The index gained 62.77 points at the day's high of 22,939.31 in early trade, a lifetime high for the barometer index. The index fell 70 points at the day's low of 22,806.54 in morning trade.
The CNX Nifty was down 6.60 points or 0.1% to 6,834.20. The index hit a high of 6,869.85 in intraday trade, a lifetime high for the index. The index hit a low of 6,818.20 in intraday trade.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,062 shares gained and 915 shares fell. A total of 107 shares were unchanged.
The BSE Mid-Cap index was up 19.91 points or 0.27% to 7,414.97. The BSE Small-Cap index was up 12.47 points or 0.16% to 7,658.57. Both these indices outperformed the Sensex.
The total turnover on BSE amounted to Rs 706 crore by 10:15 IST on BSE, compared with Rs 170 crore by 09:25 IST.
Among the 30-share Sensex pack, 16 stocks declined and rest of them gained.
Bharat Heavy Electricals (Bhel) (up 1.93%), Dr. Reddy's Laboratories (up 1.74%) and HDFC (up 1.61%) edged higher from the Sensex pack.
Index heavyweight and cigarette major ITC was off 1.33% at Rs 348.65. The stock hit high of Rs 355.20 and low of Rs 347.40 so far during the day.
Index heavyweight Reliance Industries was off 1.05% at Rs 956.65. The stock hit high of Rs 968 and low of Rs 947.50 so far during the day.
ACC fell 2.8% after consolidated profit after tax (PAT) fell 8.8% to Rs 399.85 crore on 2.1% increase in net sales to Rs 2967.14 crore in Q1 March 2014 over Q1 March 2013. The company announced the results on Thursday, 24 April 2014.
ACC said that profit after tax in Q1 March 2014 includes write back of tax of Rs 113 crore on conclusion of earlier years' assessments as compared to Rs 141 crore in this respect in the corresponding quarter of the previous year.
ACC said that in Q1 March 2014, the cement industry did not experience any significant improvement in the pace of infrastructure development and general construction. With no uptrend in the demand for cement, the company's sales volume in Q1 March 2014 was at about the same level as in the corresponding period of previous year. The company's EBITDA declined to Rs 425 crore in Q1 March 2014, from Rs 492 crore in Q1 March 2013.
ACC said that its manufacturing costs faced escalations in the cost of major inputs viz. coal, fly ash and gypsum. On the positive side, the company continued to derive benefit from its ongoing cost leadership efforts and increased sales volume of premium products. ACC added that while it does not foresee any significant improvement in the cement market in the near term, the company will continue to drive its cost leadership and customer excellence programmes to enhance sales realizations and improve margins.
Ambuja Cements fell 1.49%. The company's profit after tax rose 6.6% to Rs 520 crore on 3.7% increase in net sales to Rs 2640 crore in Q1 March 2014 over Q1 March 2013. The company announced the results on Thursday, 24 April 2014.
Ambuja Cements' operating earnings before interest, taxes, depreciation and amortization (EBITDA) rose 6.1% to Rs 587 crore in Q1 March 2014 over Q1 March 2013.
Total sales volume (cement and clinker) rose 1.7% to 6.06 million tonnes in Q1 March 2014 over Q1 March 2013.
The company said that although macro-economic condition remains challenging, construction activity is expected to pick up pace after elections. Cement demand is likely to show modest growth, Ambuja Cements said. The company will continue to work on improving operational efficiencies, cost optimisation and focus on customer and commercial excellence. The company believes that these initiatives will preserve and grow its operating margins, it said in a statement.
Ambuja Cements said that during the quarter ended 31 March 2014, the High Courts of Gujarat and Delhi have approved the Scheme of Amalgamation of Holcim (India) with the company. The effect of the scheme will be given on the fulfillment of certain conditions precedent specified therein, the company said.
UltraTech Cement fell 0.14%. UltraTech Cement's net profit rose 15.42% to Rs 838 crore on 8.18% increase in net sales to Rs 5832 crore in Q4 March 2014 over Q4 March 2013. Net profit fell 19.24% to Rs 2144 crore on 0.27% increase in net sales to Rs 20078 crore in the year ended March 2014 (FY 2014) over the year ended March 2013 (FY 2013). The result was announced after market hours on Wednesday, 23 April 2014.
The net profit of Rs 2144 crore in FY 2014 includes tax provision reversal of Rs 95.56 crore related to earlier years.
On consolidated basis, UltraTech Cement's net profit declined 17.61% to Rs 2206.03 crore on 1.6% growth in total income to Rs 21974.92 crore in FY 2014 over FY 2013.
UltraTech Cement said that FY 2014 witnessed continuing pressure on input and logistics costs, given the increase in railway freight and a continuous hike in diesel prices. Although there was some relief on account of softening in prices of imported coal, the impact was negated by the depreciation of rupee, the company said in a statement.
Optimization of fuel mix and other initiatives helped in maintaining costs almost at the previous year levels, UltraTech Cement said in a statement. UltraTech Cement said its cement capacity currently stands at 53.95 MTPA with commissioning of new units during FY 2014.
UltraTech Cement said that the company has earmarked around Rs 10000 crore to be incurred for setting up the remaining grinding units, clinkerisation plants, cement terminals and other capex in the current round of expansion. These are likely to be commissioned in a phased manner by 2015, the company said. A judicious mix of internal accruals and borrowings has been used for funding the projects, UltraTech Cement said in a statement.
UltraTech Cement said in the long term cement demand is likely to grow over 8% in line with GDP growth. The value drivers for growth will continue to be housing demand and infrastructure development, the company said in a statement.
In the foreign exchange market, the rupee edged lower against the dollar on speculation importers stepped up dollar purchases to meet month-end payments. The partially convertible rupee was hovering at 61.1125, compared with its close of on 61.07/08 on Wednesday, 23 April 2014. Indian financial markets were closed on Thursday, 24 April 2014, on account of Parliamentary elections in Mumbai constituency.
The country will likely get below-normal levels of monsoon rain this year, the India Meteorological Department (IMD) said on Thursday, 24 April 2014. The IMD said that the rainfall during the June-September summer rainy season will likely be 95% of the long-term average for the country. India's weather department defines a normal monsoon as one with rainfall between 96% and 104% of the 50-year average, which is 89 centimeters this year. This year could be a below normal monsoon, the weather department said, as there is a 60% possibility of the emergence of the El Ni weather phenomenona warm weather system that starts in the southern Pacific can affect weather around the world. El Ni last affected India's monsoon in 2009 when the monsoon rainfall was 23% below normal.
Annual rains are important for India as most of its farmlands are dependent or rain for irrigation and more than half of its workforce is employed in agriculture. The monsoon rains usually arrive over the southern state of Kerala by the end of May or the first week of June, and gradually cover the entire country by July. The IMD will revise its update in June.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014, as consumer-price inflation eased to a two-year low and as the rupee firmed up against the dollar.
A major near term trigger for the stock market is the outcome of the upcoming Lok Sabha elections. The 36 days long voting process began on 7 April 2014 and will conclude on 12 May 2014. The results will be declared on 16 May 2014 after which India will get a new government. The term of the current Lok Sabha expires on 1 June and the new House has to be constituted by 31 May.
Asian stocks declined on Friday, 25 April 2014, on fears of escalating tensions in Ukraine. Key benchmark indices in China, Japan, South Korea, Taiwan, Hong Kong and Singapore were off 0.06% to 2.06%. In Indonesia, the Jakarta Composite index was up 0.38%.
In Japan, consumer prices rose 2.7% in April from a year earlier, the biggest jump since 1992, driven by a sales-tax increase and stimulus from the Bank of Japan. Inflation excluding fresh food accelerated from 1% in the previous month, while nationally the same price gauge rose 1.3% in March from a year earlier, statistics bureau data showed today, 25 April 2014.
Trading in US index futures indicated that the Dow could drop 22 points at the opening bell on Friday, 25 April 2014. US stock markets finished Thursday's volatile session generally higher as positive earnings and stronger-than-expected data outweighed worries over military escalation near Ukrainian border.
US Secretary of State John Kerry on Thursday, 24 April 2014, warned that Russia is running out of time to comply with an accord to ease tensions in Ukraine, as Russian forces began new military exercises on the two countries' border.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 29-30 April 2014. The Federal Reserve on 19 March 2014 decided after the conclusion of a monetary policy review to trim its monthly bond purchases by $10 billion to $55 billion
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