Key benchmark indices regained positive zone in mid-afternoon trade. The barometer index, the S&P BSE Sensex, was up 9.04 points or 0.04%, up 42.75 points from the day's low and off 92.06 points from the day's high. The market breadth, indicating the overall health of the market, was negative.
Bajaj Auto extended intraday gain in volatile trade. Shares of select finance companies that have applied for banking license were in demand on media report that an advisory committee is due to give its recommendations on bank licences by this weekend to the Reserve Bank of India.
Among tyre shares, Apollo Tyres hit record high. Among other side counters, Alembic Pharmaceuticals hit record high. Bajaj Electricals, JSW Holdings and Mahindra CIE Automotive hit 52-week high.
Key benchmark indices edged higher in early trade on firm Asian stocks. The Sensex and the 50-unit CNX Nifty, both, hit 4-1/2-week high. Key benchmark indices trimmed initial gains in morning trade. Key benchmark indices hovered in green in mid-morning trade. Key benchmark trimmed intraday gains in early afternoon trade as the Shanghai Composite index extends losses in late trading there. Key benchmark indices slipped into the red later. Key benchmark indices regained positive zone in mid-afternoon trade.
The market may remain volatile in the near future as traders roll over positions in the futures and options (F&O) segment from the near-month February 2014 series to March 2014 series. The near month February 2014 F&O contracts expire tomorrow, 26 February 2014. The stock market remains closed on Thursday, 27 February 2014, on account of Mahashivratri.
Foreign institutional investors (FIIs) bought shares worth a net Rs 266.87 crore on Monday, 24 February 2014, as per provisional data from the stock exchanges.
At 14:15 IST, the S&P BSE Sensex was up 9.04 points or 0.04% to 20,820.48. The index jumped 101.10 points at the day's high of 20,912.54 in early trade, its highest level since 24 January 2014. The index fell 33.71 points at the day's low of 20,777.73 in afternoon trade.
The CNX Nifty was up 5.25 points or 0.08% to 6,191.35. The index hit a high of 6,216.85 in intraday trade, its highest level since 24 January 2014. The index hit a low of 6,176.60 in intraday trade.
The BSE Mid-Cap index was up 15.43 points or 0.24% at 6,457.03, outperforming the Sensex. The BSE Small-Cap index was up 2.32 points or 0.04% at 6,417.95, with the index matching the Sensex's gain.
The market breadth, indicating the overall health of the market, was negative. On BSE, 1,333 shares fell and 1,169 shares rose. A total of 162 shares were unchanged.
Coal India (down 2.46%), GAIL (India) (down 2.22%) and Tata Steel (down 1.71%) edged lower form the Sensex pack. Bharat Heavy Electricals (Bhel) (up 2.11%), Wipro (up 1.82%) and Bharti Airtel (up 1.82%) edged higher from the Sensex pack.
Bajaj Auto gained 2.3% to Rs 1,905 in volatile trade. The stock hit high of Rs 1,908 and low of Rs 1,855 so far during the day.
Tata Power Company lost 2.54% on equity dilution worrries. The company after market hours on Monday, 24 February 2014, said that a meeting of the board of directors of the company has been convened on Thursday, 27 February 2014, to consider various fund raising options including but not limited to equity issuances by way of a rights issue, preferential issue, qualified institutions placement or any combination thereof.
Separately, Tata Power Company during market hours today, 25 February 2014, said that its wholly owned subsidiary viz. Tata Power Renewable Energy (TPREL) has completed acquisition of 100% shareholding in AES Saurashtra Windfarms (ASW), the erstwhile 100% subsidiary of AES Corporation. ASW owns and operates a 39.2 megawatt (MW) wind farm near Dwarka in Jamnagar district of Gujarat. The project which is fully operational since January 2012 has executed a power purchase agreement with GUVNL for sale of the electricity at a tariff of Rs 3.56/kWh for the duration of the project. The project is registered with UNFCCC as a CDM project and is eligible to receive CERs. The project is also registered under the Generation Based Incentive scheme of MNRE.
TPREL was selected as the preferred bidder in a process conducted by AES Corporation for sale of its 100% stake in ASW in September 2013 and signed a share purchase agreement for the acquisition on 7 October 2013. The acquisition was subject to certain conditions, which have now been completed, Tata Power Company said in a statement.
With this acquisition, Tata Power's total generation capacity will increase to 8,560 MW and its wind operational generation capacity to 437 MW with wind turbines located across five states -- Maharashtra, Rajasthan, Gujarat, Tamil Nadu and Karnataka -- which are the leading states in promoting wind power generation in India, Tata Power said.
Speaking on achieving this milestone, Mr. Anil Sardana, Managing Director, Tata Power, said: "Tata Power endeavors to generate 20-25% of its total generation capacity from clean energy sources and is proud to have completed this acquisition of the 39.2 MW operational wind farm. The project is a clean energy project, which will enhance and increase the company's clean energy footprint. This is our second acquisition of an operating wind asset and we are in constant look out for similar opportunities in respect of wind and solar plants- This is yet another step towards the company's commitment to sustainability".
Shares of select finance companies that have applied for banking license were in demand on media report that an advisory committee is due to give its recommendations on bank licences by this weekend to the Reserve Bank of India. Muthoot Finance (up 1.8%), L&T Finance Holdings (up 4.59%), LIC Housing Finance (up 2.81%), Edelweiss Financial Services (up 2.88%), Bajaj Finance (up 2.18%), IDFC (up 1.86%), Reliance Capital (up 0.69%) and Religare Enterprises (up 0.2%), edged higher.
Financial Services Secretary Rajiv Takru was quoted by the media as saying on Monday, 24 February 2014, that the advisory committee headed by former Reserve Bank of India (RBI) governor Bimal Jalan is expected to give its report by this weekend. The committee, which is screening the 25 bank licence applications, will meet today, 25 February 2014. This might be its final meeting before it gives its recommendations to the central bank, report suggested.
RBI had constituted the Jalan committee to examine the fit-and-proper criteria, business plans, corporate governance practices, etc, of applicants.
Apollo Tyres gained 1.51% to Rs 127.60 after hitting a record high of Rs 128.80 in intraday trade.
Alembic Pharmaceuticals rose 3.57% to Rs 255.55 after hitting a record high of Rs 257.50 in intraday trade.
Bajaj Electricals advanced 4.08% to Rs 240.80 after hitting a 52-week high of Rs 243.20 in intraday trade.
JSW Holdings jumped 6.17% to Rs 597 after hitting a 52-week high of Rs 635.40 in intraday trade.
Mahindra CIE Automotive galloped 16.06% to Rs 76.25 after hitting a 52-week high of Rs 78.80 in intraday trade.
Vesuvius India lost 6.49% after net profit fell 23.05% to Rs 13.59 crore on 1.17% increase in total income from operations to Rs 155.34 crore in Q4 December 2013 over Q4 December 2012. The result was announced during trading hours today, 25 February 2014.
In the foreign exchange market, the rupee edged higher against the dollar, tracking gains in other Asian currencies versus the dollar. The partially convertible rupee was hovering at 61.905, compared with its close of 62.07/08 on Monday, 24 February 2014.
Government bond prices dropped for the second day in a row after Reserve Bank of India (RBI) Governor Raghuram Rajan on Sunday, 23 February 2014, warned that inflation remains the biggest threat to economic growth and that reining in price gains is RBI's top challenge. The yield on 10-year benchmark federal paper, 8.83% GS 2023, was hovering at 8.8939%, higher than its close of 8.885% Monday, 24 February 2014. Bond yield and bond prices move in opposite direction.
Rajan in another television interview which was broadcast on Monday, 24 February 2014, said the government and the central bank shared similar views on inflation management, while reiterating a call for the US Federal Reserve to be more sensitive to emerging economies. Rajan's comments come after Finance Minister P. Chidambaram last week chided the central bank over its focus on fighting inflation, saying the RBI needed to abide by government policy to promote economic growth. "It's not as if the government is on a different page on what we've been doing on inflation thus far. They may have different views on what they would like to see done, but there is a process, there is a conversation. I think there is fair amount of coordination at the highest level," Rajan said.
Rajan said the central bank panel report on inflation was consistent with the government's stance. "We have a committee which has suggested a target, which is also by the way, consistent with the process the finance ministry's committee has suggested, so there is no disagreement about the broader need to get a framework in place. I think in terms of how I see the process, is really that the government sets the objective, and the central bank delivers on that objective," Rajan said.
Rajan said he believes India is likely to continue with its major economic policies irrespective of the government at the Centre after the upcoming general elections. "My sense is if there is a stable coalition post election, no matter which persuasion it is, the broad policies will continue. There may be difference in details but they are all for passing the Goods and Services Tax, all for a number of actions that the current government is taking," Rajan said. The central bank is likely to continue the level of coordination and discussion with the government after the elections, Rajan said.
Rajan also reiterated his call for the Federal Reserve to take into account the impact of its withdrawal of monetary stimulus on emerging economies, despite saying he was comfortable with the current pace of tapering. "I actually welcome a measured pace of tapering. The only thing I have been calling for is that in the communication there should be some sensitivity to conditions in emerging markets. And this is not from our perspective, this is broadly emerging markets, some of whom have been in trouble in the last few months. But I am fully prepared for a tapering that continues at this measured pace," Rajan said.
The Reserve Bank of India next undertakes monetary policy review on 1 April 2014. Citing price pressures, the Reserve Bank of India raised its key lending rates by 25 basis points after Third Quarter Review of Monetary Policy for 2013-14 on 28 January 2014.
European stocks edged lower on Tuesday, 25 February 2014, with mining firms sliding as metals prices weakened and Vivendi SA dropping after an earnings report. Key benchmark indices in UK, Germany and France were off 0.37% to 0.54%.
In Italy, Prime Minister Matteo Renzi won a confidence vote in the Senate, giving his new coalition government a first indication of its backing in parliament.
Ukraine's acting president, Oleksandr Turchynov, told parliament he expects lawmakers to vote today, 25 February 2014, on a national unity government led by a prime minister people would trust. Turchynov indicated on Monday, 24 February 2014, that he expects to move quickly to fill the government vacuum so officials can seek the economic aid needed to fend off default.
Chinese stocks led decline in Asian markets on Tuesday, 25 February 2014, amid speculation a weaker property market and falling yuan will curb corporate earnings in the world's second biggest economy. In mainland China, the Shanghai Composite index was off 2.04%. Hong Kong's Hang Seng index was off 0.32%. China's Industrial Bank Co. on Monday, 24 February 2014, said it will delay loans for property projects until the end of March, fueling speculation that a weaker housing market will erode demand for everything from electric appliances to cars.
In other Asian markets, key benchmark indices in Indonesia and Singapore were off 0.02% to 1.05%. Key benchmark indices in Japan, Taiwan and South Korea were up 0.18% to 1.44%.
Trading in US index futures indicated that the Dow drop 16 points at the opening bell on Tuesday, 25 February 2014. US stocks climbed on Monday, 24 February 2014, boosted by M&A activity, an upbeat German confidence report and bets that the S&P 500's foray into new high ground could spur further buying. The main indexes finished with solid gains, although they ended well off their session highs as buying momentum faded.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review on 18-19 March 2014. After a monetary policy review, the FOMC on 29 January 2014 announced it will reduce monthly bond purchases by another $10 billion to $65 billion.
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