Gains in frontline stocks took key benchmark indices further higher in mid-afternoon trade. The barometer index, the S&P BSE Sensex, was currently above the psychological 29,000 level. Earlier, the Sensex had fallen below that psychological level soon after surpassing that mark in early afternoon trade. The Sensex and the 50-unit CNX Nifty, both, hit their highest level in more than a week. The Sensex was currently up 272.12 points or 0.94% at 29,077.22. The market breadth indicating the overall health of the market was positive.
European stocks edged higher, boosted by the tentative signs that the eurozone economy is turning the corner and hopes that Greece and its creditors can strike a deal on extending its bailout. Asian stocks edged higher after Germany and France brokered a deal with Russia yesterday, 12 February 2015, to end fighting in Ukraine. Brent crude oil futures extended previous session's rally.
Mahindra & Mahindra (M&M) shrugged off weak Q3 results. Cement stocks rose. BPCL rose after turnaround in Q3. Max India gained after blockbuster Q3 results.
On the macro front, the rate of inflation based on the consumer price index (CPI) accelerated to 5.11% in January 2015 from 4.28% in December 2014 after the statistics ministry revised the base year for the calculation of the index to 2012 from 2010. Meanwhile, growth in industrial production decelerated to 1.7% in December 2014 from 3.9% in November 2014. Both CPI and industrial production data was announced after market hours yesterday, 12 February 2015.
Prime Minister Narendra Modi yesterday, 12 February 2015, said that the government is committed to provide predictable and stable tax regime and policies. Finance Minister Arun Jaitley yesterday, 12 February 2015, said that the government is determined to pursue economic reforms despite a defeat for the Bharatiya Janata Party (BJP) in assembly election in Delhi early this week.
Foreign portfolio investors sold shares worth a net Rs 406.28 crore yesterday, 12 February 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 705.53 crore yesterday, 12 February 2015, as per provisional data.
In overseas markets, European stocks edged higher, boosted by the tentative signs that the eurozone economy is turning the corner and hopes that Greece and its creditors can strike a deal on extending its bailout. Asian stocks edged higher after Germany and France brokered a deal with Russia yesterday, 12 February 2015, to end fighting in Ukraine. US stocks climbed yesterday, 12 February 2015, with major benchmarks nearing record highs, buoyed by a truce deal in Ukraine and strong quarterly earnings reports.
In the foreign exchange market, the rupee edged higher against the dollar on global risk-on sentiment.
Brent crude oil futures edged higher as news of deeper industry spending cuts and a sinking US dollar revived buying. Global crude oil prices have witnessed high volatility over the past few days after a steep slide in prices over the past few months. The recent rebound in global crude oil prices will raise concerns pertaining to India's fiscal deficit, current account deficit and fuel price inflation. However, gains in rupee against the dollar will mitigate the negative impact of higher crude oil price. Gains in local currency will reduce the cost of imports. India imports about 80% of its crude oil requirements.
At 14:19 IST, the S&P BSE Sensex was up 272.12 points or 0.94% at 29,077.22. The index jumped 276.05 points at the day's high of 29,081.15 in mid-afternoon trade, its highest level since 5 February 2015. The index gained 30.60 points at the day's low of 28,835.70 in early trade.
The CNX Nifty was up 84.30 points or 0.97% at 8,795.85. The index hit a high of 8,799.55 in intraday trade, its highest level since 5 February 2015. The index hit a low of 8,729.65 in intraday trade.
The BSE Mid-Cap index was up 80.50 points or 0.76% at 10,742.61. The BSE Small-Cap index was up 58.35 points or 0.52% at 11,258.50. Both these indices underperformed the Sensex.
The market breadth indicating the overall health of the market was positive. On BSE, 1,418 shares rose and 1,338 shares fell. A total of 92 shares were unchanged.
Mahindra & Mahindra (M&M) rose 3.31% to Rs 1,171.50. The stock hit high of Rs 1,184.70 and low of Rs 1,122.80 so far during the day. The company's net profit rose 0.86% to Rs 942.14 crore on 9.23% decline in total income to Rs 9667.08 crore in Q3 December 2014 over Q3 December 2013. The result was announced during market hours. M&M's results were quite weak operationally. The net profit was boosted by exceptional items.
Cement stocks rose. Ambuja Cements (up 1.43%), UltraTech Cement (up 1.51%) and Shree Cement (up 1.58%) gained.
Grasim Industries rose 1.32%. Grasim has exposure to the cement sector through its subsidiary UltraTech Cement.
ACC extended previous session's gains triggered by reports that the stock's weightage has increased in the MSCI Indexes after a quarterly review. The stock was up 1.85%.
BPCL rose 2.79% to Rs 727 after turnaround in Q3. The stock hit high of Rs 732.85 and low of Rs 693 so far during the day. The company reported net profit of Rs 551.16 crore in Q3 December 2014 as compared with net loss of Rs 1088.94 crore in Q3 December 2013. Total income dropped 10.38% to Rs 58265 crore in Q3 December 2014 over Q3 December 2013. The result was announced during market hours.
Max India rose 3.89% after net profit spurted 346.8% to Rs 329.33 crore on 40.9% growth in total income to Rs 416.44 crore in Q3 December 2014 over Q3 December 2013. The result was announced after market hours yesterday, 12 February 2015.
In the foreign exchange market, the rupee edged higher against the dollar on global risk-on sentiment. The partially convertible rupee was hovering at 62.165, compared with its close of 62.305 during the previous trading session.
Brent crude oil futures edged higher as news of deeper industry spending cuts and a sinking US dollar revived buying. Brent for April settlement was up 97 cents at $60.25 a barrel. The contract had surged $3.36 a barrel to settle at $59.28 a barrel during the previous trading session.
On macro front, the rate of inflation based on the consumer price index (CPI) rose 5.11% in January 2015 compared with a 4.28% gain in December 2014. The Central Statistics Office (CSO), Ministry of Statistics and Programme Implementation has revised the base year of the CPI from 2010 to 2012. Meanwhile, growth in industrial production decelerated to 1.7% in December 2014 from 3.9% in November 2014. Both CPI and industrial production data was announced after market hours yesterday, 12 February 2015.
The rate of inflation based on the wholesale price index (WPI) is seen accelerating to 0.4% in January 2015 from 0.1% in December 2014, as per the median estimate of a poll of economists carried out by Capital Market. The government will unveil WPI data for January 2015 at 12.10 noon on 16 February 2015.
Prime Minister Narendra Modi yesterday, 12 February 2015, said that the government is committed to provide predictable and stable tax regime and policies. Modi made these comments during his meeting with Treasury Secretary of the United States Jacob Lew, accompanied by the Vice Chairman of the US Federal Reserve, Stanley Fischer. The two are visiting India for the India-US Economic and Financial Partnership dialogue which is co-chaired by the Finance Minister of India.
Finance Minister Arun Jaitley yesterday, 12 February 2015, said that the government is determined to pursue economic reforms despite a defeat for the Bharatiya Janata Party (BJP) in assembly election in Delhi early this week. Jaitley also reportedly said at a news conference after talks with his US counterpart, Treasury Secretary Jack Lew that India's economy is poised to take off at a much faster pace. The BJP was trounced in assembly election held in Delhi last week. The Aam Aadmi Party won 67 of 70 seats. The BJP won a mere 3 seats.
The next major event for the financial markets is Union Budget for 2015-16. Finance Minister Arun Jaitley will present Union Budget 2015-16 in Parliament on 28 February 2015. Analysts will scrutinize measures in the Budget for financing infrastructure projects as well as the government's own capital expenditure on infrastructure for the year ahead. This is the first full fledged Budget of the Narendra Modi government and analysts will look for a roadmap for economic growth for the next few years.
Changes in rates of dividend distribution tax, capital gains tax on sale of shares, Securities Transaction Tax (STT) and Minimum Alternate Tax (MAT), if any, will be closely watched. The dividend distribution tax is currently at 15%. The minimum alternate tax is currently at 18.5% of book profits. Short term capital gains tax on sale of shares is currently at 15% while there is zero long capital gains tax on sale of shares held for a period of more than one year.
The upcoming Budget session of the parliament assumes utmost importance as the government intends to replace the ordinances it had promulgated after the conclusion of the winter session of the parliament with Bills and get them cleared by both Houses of Parliament during the budget session. The Narendra Modi government promulgated a slew of ordinances after the last session of Parliament. Some of the key ordinances include raising the FDI in the insurance sector from 26% to 49%, e-auctioning of coal mines and amendment to the Land Acquisition Act.
European stocks edged higher today, 13 February 2015, boosted by the tentative signs that the eurozone economy is turning the corner and hopes that Greece and its creditors can strike a deal on extending its bailout. Key indices in France and UK were up 0.77% to 0.89%.
After Germany logged better-than-expected fourth-quarter growth, the DAX index surged above 11,000 points for the first time. The index was currently up 0.7% at 10,995.74
Germany's Gross Domestic Product (GDP) rose by 0.7% in the fourth quarter of 2014, its fastest expansion since the first quarter of last year, latest data showed today, 13 February 2015. Destatis, the German statistics body, said that the country's economy gained momentum towards the end of 2014.
Meanwhile, a standoff between Greece and its European creditors on Greece's bailout program eased somewhat after Greece made an about-face yesterday, 12 February 2015, agreeing to talk to the "troika" of international lenders. Greece is scrambling to reach a deal with creditors before it runs out of cash. Greece's current bailout plan expires on 28 February 2015.
Asian stocks edged higher today, 13 February 2015, on news of a ceasefire accord in Ukraine, while Sweden's surprise move to cut its main rate into negative territory and hopes of a resolution between debt-strapped Greece and its creditors burnished risk appetite. Key indices in China, Hong Kong, Singapore, Taiwan, Indonesia, and South Korea were up 0.02% to 1.07%. Japan's Nikkei Average fell 0.37%.
Trading in US index futures indicated that the Dow could gain 32 points at the opening bell today, 13 February 2015. US stocks climbed on Thursday, 12 February 2015, with major benchmarks nearing record highs, buoyed by a truce deal in Ukraine and strong quarterly earnings reports.
In economic news, jobless claims in the week ended Feb. 7 rose 25,000 to 304,000, the Labor Department said. Retail sales fell in January for the second month in a row, fueling worries that the drop in gasoline prices isn't translating into more consumer spending. Sales fell 0.8% last month to $439.77 billion, the Commerce Department said.
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