Intraday recovery witnessed in afternoon trade gathered steam as key benchmark indices moved into green from red in mid-afternoon trade. The barometer index, the S&P BSE Sensex, retained the psychological 27,000 level after reclaiming that mark in afternoon trade. The Sensex had fallen below that mark earlier during the trading session. The Sensex was currently up 39.53 points or 0.15% at 27,129.95. The market breadth indicating the overall health of the market was positive. Falling global crude oil prices augur well for India as the country imports almost 80% of its crude oil requirements. Meanwhile, weakness in global industrial metal prices could reduce cost of production for manufacturing companies. Shares of most private banks rose. Shares of most PSU banks also gained. Punjab National Bank rose after the bank said its board has decided to explore the avenues for raising capital through QIP/FPO/rights issue and raise Basel III compliant additional Tier-I capital bonds. Most auto stocks gained on hopes lower industrial metal prices could boost profit margins.
In overseas markets, European stocks dropped as China's finance minister damped speculation his government will boost economic stimulus for the world's second biggest economy. Asian stocks fell amid speculation China may accept slower growth and after officials from the world's biggest economies warned of rising financial risks. US index futures were in red.
Group of 20 finance chiefs and central bankers said low interest rates could lead to a potential increase in financial-market risk, as major economies rely on monetary stimulus to bolster uneven growth. "We are mindful of the potential for a build-up of excessive risk in financial markets, particularly in an environment of low interest rates and low asset price volatility," the G-20 officials reportedly said yesterday, 21 September 2014 in Cairns, Australia, after a two-day meeting.
Earlier, key indices had moved in a narrow range after trimming initial losses triggered by negative cues from world markets.
Brent crude oil prices edged lower as sluggish demand and abundant supplies outweighed a possible cut in oil output from the Organization of the Petroleum Exporting Countries (OPEC).
In the foreign exchange market, the rupee was a tad higher against the dollar.
At 14:15 IST, the S&P BSE Sensex was up 39.53 points or 0.15% at 27,129.95. The index rose 64.15 points at the day's high of 27,154.57 in mid-afternoon trade. The index lost 171.49 points at the day's low of 26,918.93 in early trade, its lowest level since 18 September 2014.
The CNX Nifty was up 5.60 points or 0.01% at 8,122.10. The index hit a high of 8,127.70 in intraday trade. The index hit a low of 8,064.80 in intraday trade, its lowest level since 18 September 2014.
The market breadth indicating the overall health of the market was positive. On BSE, 1,600 shares gained and 1,302 shares fell. A total of 98 shares were unchanged.
The BSE Mid-Cap index was up 31.03 points or 0.31% at 9,896.29. The BSE Small-Cap index was up 87.45 points or 0.78% at 11,278.63. Both these indices outperformed the Sensex.
Shares of most private banks rose. IndusInd Bank (up 0.17%), Axis Bank (up 0.8%), Yes Bank (up 1.68%) and ICICI Bank (up 1.26%) gained. HDFC Bank (down 0.87%) and Kotak Mahindra Bank (down 2.3%) declined.
Shares of most PSU banks also gained. Bank of Baroda (up 0.78%), State Bank of India (SBI) (up 0.45%), Union Bank of India (up 0.1%), Indian Overseas Bank (up 0.98%), and Oriental Bank of Commerce (up 0.31%) gained. Bank of India (down 0.62%) and Andhra Bank down 0.44%) declined.
Punjab National Bank rose 1.45% after the bank said before market hours that the board of directors of the bank at its meeting held on 19 September 2014 decided to explore the avenues for raising capital through QIP/FPO/rights issue and raise Basel III compliant additional Tier-I capital bonds. The board also considered and granted in-principle approval for a 5-for-1 stock split.
Most auto stocks gained on hopes lower industrial metal prices could boost profit margins. Tata Motors (up 3.72%), Eicher Motors (up 1.67%), Ashok Leyland (up 1.52%) edged higher. Maruti Suzuki India (down 0.48%) and Mahindra & Mahindra (M&M) (down 0.75%) declined.
Shares of two wheeler makers gained. Hero MotoCorp (up 1.42%), Bajaj Auto (up 0.61%) and TVS Motor Company (up 2.94%) rose.
Indian stocks may remain volatile this week as traders roll over positions in the futures & options (F&O) segment from the near month September 2014 series to October 2014 series. The near-month September 2014 F&O contracts expire on Thursday, 25 September 2014.
In the foreign exchange market, the rupee was a tad higher against the dollar. The partially convertible rupee was hovering at 60.815, compared with its close of 60.83 during the previous trading session.
Brent crude oil prices edged lower as sluggish demand and abundant supplies outweighed a possible cut in oil output from the Organization of the Petroleum Exporting Countries (OPEC). Brent for November settlement was off 67 cents at $97.72 a barrel. The contract had risen 69 cents a barrel or 0.71% to settle at $98.39 a barrel on Friday, 19 September 2014.
Lower crude oil prices will help India in containing its fiscal deficit, current account deficit and fuel price inflation. India imports 80% of its crude oil requirement.
Prime Minister Narendra Modi is scheduled to launch the ambitious 'Make in India' campaign on Thursday, 25 September 2014. The initiative is one of the several steps which government has announced in order to improve ease of doing business in India and attract investments to boost manufacturing in the country. In his maiden independence day address, Modi invited the global business community to set up manufacturing facilities in India, giving the slogan 'come, make in India'.
Meanwhile, Finance Minister Arun Jaitley was reportedly admitted to the Max Institute private hospital in New Delhi yesterday, 21 September 2014, for a routine post-operative examination. Jaitely this month underwent gastric bypass surgery to treat weight gain he had suffered because of a long-standing diabetic condition.
European stocks dropped today, 22 September 2014, tracking weak commodity prices and as China's finance minister damped speculation his government will boost economic stimulus for the world's second biggest economy. Key indices in Germany, London and France were off 0.41% to 0.66%.
Italian industrial orders dropped in July as both foreign and domestic demand slipped, underscoring the struggle of euro zone's third-largest economy to exit a prolonged recession. Industrial orders declined 1.5% on the month, after a similar drop in June, national statistics institute Istat said today, 22 September 2014, using seasonally adjusted data. Orders were down 0.7% on the year in unadjusted terms, Istat added. Orders are a proxy for future industrial output, a key metric for Italy, which has Europe's second-largest manufacturing sector.
Asian stocks fell today, 22 September 2014, amid speculation China may accept slower growth and after officials from the world's biggest economies warned of rising financial risks. Key benchmark indices in Singapore, Hong Kong, Indonesia, Taiwan, Japan and South Korea were off 0.11% to 1.7%.
China's Finance Minister Lou Jiwei said growth in Asia's largest economy faces downward pressure and reiterated that there won't be major changes in policy in response to individual economic indicators. China's economy is growing in a stable way and operating within a reasonable range, Lou said in a statement published on the People's Bank of China website. Macroeconomic policy will focus on comprehensive targets, particularly job growth and price stability, the statement said.
A preliminary reading on the HSBC Holdings Plc/Markit Economics China manufacturing purchasing managers' index is due tomorrow, 23 September 2014.
Trading in US index futures indicated that the Dow could fall 61 points at the opening bell on Monday, 22 September 2014. Most US stocks edged lower on Friday, 19 September 2014, after a three-day rally
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