A rebound in late trade took key benchmark indices into positive zone from negative zone. The rebound in late trade materialized after key benchmark indices languished in negative zone almost throughout the trading session. The barometer index, the S&P BSE Sensex, was provisionally up 124.93 points or 0.42% at 29,684.11. The market breadth indicating the overall health of the market was negative.
Key benchmark indices witnessed intraday volatility as traders rolled over positions in the futures & options (F&O) segment from the near month January 2015 series to February 2015 series. The near month January 2015 derivatives contracts expired today, 29 January 2015.
Index heavyweight and cigarette major ITC edged higher. Index heavyweight Reliance Industries (RIL) edged higher on reports that RIL and its partner BP plc of UK will invest about Rs 6000 crore by 2016 to help sustain and improve recovery from the two main gas fields in the eastern offshore KG-D6 block. Dr Reddy's Laboratories (DRL) rose in volatile trade after declaring Q3 result. Sesa Sterlite rose after declaring Q3 result.
HDFC Bank edged higher after the Cabinet Committee on Economic Affairs gave its approval to the proposal of the private sector bank for maintaining the permissible foreign holding in the bank up to 74% of the total paid up capital and issuance of equity shares of the bank aggregating to an amount of Rs 10000 crore to NRIs/FIIs/FPIs subject to aggregate foreign shareholding not exceeding 74% of the post issue paid up capital of the bank. HDFC dropped after announcing Q3 result.
PSU OMCs were in demand as global crude oil prices dropped overnight with shares of HPCL scaling record high. Coal India dropped in volatile trade after the government after market hours yesterday, 28 January 2015, announced that it will sell up to 10% stake in the state-run coal major through the stock exchanges mechanism on Friday, 30 January 2015.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 1723.17 crore yesterday, 28 January 2015, as per provisional data.
Meanwhile, the Union Cabinet yesterday, 28 January 2015, decided that the Government of India (GoI) will not file Special Leave Petition (SLP) before the Supreme Court of India against a Bombay High Court order dated 10 October 2014 which had quashed a transfer pricing-related tax demand on Vodafone Group Plc. This is a major correction of a tax matter which has adversely affected investor sentiment, according to a government statement issued yesterday, 28 January 2015
In the foreign exchange market, the rupee edged lower against the dollar as the US central bank reiterated its commitment to raising interest rates in the United States some time in the latter part of the year after the conclusion of a two-day meeting on monetary policy review yesterday, 28 January 2015.
Brent crude oil futures edged higher in volatile trade.
In overseas markets, European stocks fell as disappointing earnings from Royal Dutch Shell Plc dragged energy companies lower. Asian stocks declined after the US Federal Reserve unexpectedly lifted its view on the economy, signalling that the US central bank remains firmly on track with plans to raise interest rates this year. US stocks edged lower yesterday, 28 January 2015, after the US Federal Reserve unexpectedly lifted its view on the economy, signalling that the US central bank remains firmly on track with plans to raise interest rates this year.
As per provisional closing, the S&P BSE Sensex was up 124.93 points or 0.42% at 29,684.11. The index jumped 181.45 points at the day's high of 29,740.63 in late trade. The index lost 180.88 points at the day's low of 29,378.30 in early trade, its lowest level since 27 January 2015.
The CNX Nifty was up 38.05 points or 0.43% at 8,952.35. The index hit a high of 8,966.65 in intraday trade. The index hit a low of 8,861.25 in intraday trade, its lowest level since 27 January 2015.
The market breadth indicating the overall health of the market was negative. On BSE, 1,456 shares dropped and 1,423 shares rose. A total of 128 shares were unchanged.
The BSE Mid-Cap index was off 37.36 points or 0.35% at 10,771.08. The BSE Small-Cap index was up 9.64 points or 0.08% at 11,378.75. Both these indices underperformed the Sensex.
The total turnover on BSE amounted to Rs 3732 crore, lower than Rs 3960.55 crore yesterday, 28 January 2015.
Index heavyweight and cigarette major ITC gained 2.37% to Rs 371. The stock hit high of Rs 372 and low of Rs 360.10.
Sesa Sterlite rose 0.6% to Rs 202. The stock hit high of Rs 203.80 and low of Rs 195.55. The company's consolidated net profit fell 15.02% to Rs 1587.50 crore on 1.55% fall in total income to Rs 19218.90 crore in Q3 December 2014 over Q3 December 2013. The result was announced during market hours today, 29 January 2015.
Index heavyweight Reliance Industries (RIL) edged higher on reports that RIL and its partner BP plc of UK will invest about Rs 6000 crore by 2016 to help sustain and improve recovery from the two main gas fields in the eastern offshore KG-D6 block. The stock was up 2.41% to Rs 927.70.
PSU OMCs were in demand as global crude oil prices declined overnight. Lower crude oil prices could reduce under-recoveries of PSU OMCs on domestic sale of LPG and kerosene at controlled prices. However, a weakness in rupee against the dollar will restrict the benefit of falling global crude oil prices to that extent. A weak rupee raises the cost of imports. The government has already freed pricing of petrol and diesel.
Indian Oil Corporation gained 2.87%.
HPCL jumped 6.68% to Rs 636 after scaling a record high of Rs 640 in intraday trade.
BPCL rose 3.5%. BPCL after trading hours yesterday, 28 January 2015, announced that it has set-up a Medium Term Note (MTN) Programme to facilitate the raising of funds on a regular basis from the international debt capital markets. The aggregate nominal amount of notes outstanding under the program will not exceed $2 billion or its equivalent in other currencies, BPCL said. Fitch Ratings has assigned a 'BBB-' rating and Moody's Investors Service has assigned a provisional (P) Baa3 rating to the MTN Programme.
Dr Reddy's Laboratories (DRL) rose 4.17% to Rs 3,373. The stock hit high of Rs 3,374.40 and low of Rs 3,213.20. On a consolidated basis, DRL reported 7.09% fall in net profit to Rs 574.53 crore on 9.17% rise in total income to Rs 3877.20 crore in Q3 December 2014 over Q3 December 2013. The result was announced during market hours today, 29 January 2015.
Dr Reddy's Laboratories' EBITDA (earnings before interest, taxation, depreciation, and amortization) rose 4.63% to Rs 1051.50 crore in Q3 December 2014 over Q3 December 2013.
Dr Reddy's Laboratories consolidated revenues rose 9% to Rs 3840 crore in Q3 December 2014 over Q3 December 2013. Revenues from the Global Generics (GG) segment rose 8% to Rs 3170 crore in Q3 December 2014 over Q3 December 2013. Revenues from the Pharmaceutical Services and Active Ingredients (PSAI) segment rose 21% to Rs 610 crore in Q3 December 2014 over Q3 December 2013.
Gross Profit Margin fell to 58.2% in Q3 December 2014, from 60.5% in Q3 December 2013. During Q3 December 2014, the company launched 13 new generic products, filed 18 new product applications and 14 DMFs globally.
HDFC Bank edged higher after the Cabinet Committee on Economic Affairs gave its approval to the proposal of the private sector bank for maintaining the permissible foreign holding in the bank up to 74% of the total paid up capital and issuance of equity shares of the bank aggregating to an amount of Rs 10000 crore to NRIs/FIIs/FPIs subject to aggregate foreign shareholding not exceeding 74% of the post issue paid up capital of the bank. The stock rose 3.37% to Rs 1,093.80. The scrip hit record high of Rs 1,099.70 in intraday trade.
It may be recalled that the Reserve Bank of India (RBI) had in December 2013 imposed a ban on further purchases of shares of HDFC Bank after foreign share holding in the bank crossed the overall limit of 49% of the bank's paid-up capital.
HDFC fell 3.04% to Rs 1,303.80. The stock hit high of Rs 1,343 and low of Rs 1,296. The housing finance major reported 11.56% rise in net profit to Rs 1425.49 crore on 14.13% rise in total income to Rs 6870.95 crore in Q3 December 2014 over Q3 December 2013. HDFC's loan book stood at Rs 2.19 lakh crore as on 31 December 2014, as against Rs 1.92 lakh crore as on 31 December 2013.
Bharat Heavy Electricals (Bhel) gained 2.72% to Rs 286.50. The stock hit high of Rs 289.15 and low of Rs 276.10. Bhel during market hours said the company has achieved one more landmark by successfully commissioning another 600 megawatt (MW) thermal unit in Odisha. The unit was commissioned at Jindal India Thermal Power (JITPL)'s upcoming 2x600 MW thermal power project located at Derang in Angul District of Odisha.
In Odisha, Bhel is presently executing 3,970 MW of thermal power projects.
Coal India fell 1.31% to Rs 379. The stock hit a high of Rs 380.10 and low of Rs 364.60. The government after market hours yesterday, 28 January 2015, announced divestment of its stake in the company. The government has offered to sell 31.58 crore equity shares, or 5% equity, of face value of Rs 10 each with an option to sell an additional upto 31.58 crore equity shares, or 5% equity, of face value of Rs 10 each of Coal India, collectively aggregating to 10% of the total paid up equity share capital of Coal India through a sale on the separate window provided by the stock exchanges for this purpose. The sale shall commence on 30 January 2015 at 9:15 IST and shall close on the same day at 15:30 IST. The floor price for the OFS will be announced after market hours today, 29 January 2015.
The government has reserved 20% of the size of the sale for retail investors. Retail investors will be offered a discount of 5% to the bid price entered by them in accordance with the Sebi OFS circulars. A minimum of 25% of the sale shares will be reserved for mutual funds and insurance companies.
Meanwhile, with respect to news titled "CIL Stake Sale : Unions Threaten to 'Go Slow' Now," Coal India clarified during trading hours that it is neither aware of the strike nor any notice has been received from any unions to this effect.
In the foreign exchange market, the rupee edged lower against the dollar as the US central bank reiterated its commitment to raising interest rates in the United States some time in the latter part of the year after the conclusion of a two-day meeting on monetary policy review yesterday, 28 January 2015. The partially convertible rupee was hovering at 61.64, compared with its close of 61.41 during the previous trading session.
Brent crude oil futures edged higher in volatile trade. Brent for March settlement was up 16 cents at $48.63 a barrel. The contract had declined $1.13 a barrel or 2.27% to settle at $48.47 a barrel during the previous trading session.
Meanwhile, the Union Cabinet yesterday, 28 January 2015, decided that the Government of India (GoI) will not file Special Leave Petition (SLP) before the Supreme Court of India against a Bombay High Court order dated 10 October 2014 which had quashed a transfer pricing-related tax demand on Vodafone Group Plc. The Union Cabinet also decided that the GoI will accept orders of courts/IT AT/DRP in cases of other taxpayers where similar transfer pricing adjustments have been made and the courts/IT AT/DRP have decided/decide in favour of the taxpayer. These decisions will bring greater clarity and predictability for taxpayers as well as tax authorities, thereby facilitating tax compliance and reducing litigation on similar issues, according to a government statement. This will also set at rest the uncertainty prevailing in the minds of foreign investors and taxpayers in respect of possible transfer pricing adjustments in India on transactions related to issuance of shares and thereby improve the investment climate in the country, the statement said. The Union Cabinet came to this view as this is a transaction on the capital account and there is no income to be chargeable to tax. So applying any pricing formula is irrelevant.
Meanwhile, the Reserve Bank of India (RBI) is widely expected to keep its main lending rate viz. the repo rate unchanged at 7.75% after a monetary policy review next week. The sixth bi-monthly monetary review from the RBI is scheduled on Tuesday, 3 February 2015. The central bank may likely focus on the details of the upcoming Union Budget 2015-16 which is scheduled on 28 February 2015, before taking a call on further monetary policy easing. The RBI surprised financial markets by announcing a cut in the repo rate by 25 basis points in an unscheduled monetary policy review on 15 January 2015, citing easing of inflationary pressures in the economy. The annual rate of inflation based on the combined consumer price indices (CPI) for urban and rural India rose to 5% in December 2014 from 4.4% in November 2014. Over the long term, the RBI aims to restrict consumer price inflation to 4%, within a two-per-cent band.
European stocks fell today, 29 January 2015, as disappointing earnings from Royal Dutch Shell Plc dragged energy companies lower. Key benchmark indices in UK, France and Germany were off 0.67% to 1%.
German unemployment fell in January, the country's labor office said today, 29 January 2015. The number of unemployed fell by 9,000 in January after seasonal variations in the data, following a 25,000 drop in December. The seasonally adjusted unemployment rate was 6.5% in January, down from 6.6% in December.
Greece's Prime Minister Alexis Tsipras reportedly said yesterday, 28 January 2015, that he will push for debt relief from the country's international creditors.
Asian stocks declined today, 29 January 2015, after the US Federal Reserve unexpectedly lifted its view on the economy, signalling that the US central bank remains firmly on track with plans to raise interest rates this year. Key benchmark indices in China, Taiwan, Hong Kong, Japan, Indonesia and South Korea fell by 0.12% to 1.31%. In Singapore, the Straits Times index was unchanged at 3,419.05.
Japanese retail sales rose 0.2% in December from a year earlier, marking the sixth straight month of increase, the government said today, 29 January 2015. The figures, released by the Ministry of Economy, Trade and Industry, highlighted that consumer demand continues to rebound after the national sales tax increased to 8% from 5% in April.
Trading in US index futures indicated that the Dow could rise 32 points at the opening bell today, 29 January 2015. US stocks ended yesterday's choppy trading session sharply lower after the Federal Reserve's policy-making committee reiterated it plans to remain patient and watch the data as it decides when to raise interest rates.
The US Federal Reserve yesterday, 28 January 2015 said the US economy was expanding "at a solid pace" with strong job gains in a signal that the central bank remains on track with its plans to raise interest rates this year. The Fed repeated it would be "patient" in deciding when to raise benchmark borrowing costs from zero, though it also acknowledged a decline in certain inflation measures.
After a two-day meeting of the Federal Open Market Committee, policymakers struck an upbeat tone on the US economy's prospects and held to their view that energy-led weakness in inflation would dissipate. "Economic activity has been expanding at a solid pace," the Fed said in a statement that marked an upgrade to its prior assessment of a "moderate pace" of growth. "Labor market conditions have improved further, with strong job gains and a lower unemployment rate."
The US Commerce Department releases its first estimate of fourth-quarter GDP tomorrow, 30 January 2015.
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