A range bound movement was witnessed as key benchmark indices languished in negative zone in mid-morning trade. The market breadth indicating the overall health of the market turned negative from positive. The barometer index, the S&P BSE Sensex, was currently off 59.50 points or 0.22% at 27,584.38.
Bank stocks declined. Tata Motors edged lower ahead of its Q4 March 2015 results today, 26 May 2015. Bharat Heavy Electricals dropped amid volatility ahead of its Q4 March 2015 earnings today, 26 May 2015.
Meanwhile, Reserve Bank of India (RBI) Governor Dr. Raghuram G. Rajan yesterday, 25 May 2015, said that while India's macro economic parameters have improved, growth was still slow in picking up. Finance Minister Arun Jaitley yesterday, 25 May 2015, said India has to bring the tax rate to global level while at the same time remove the exemptions.
Earlier, the Sensex hit its lowest level in more than a week and the 50-unit CNX Nifty hit one-week low in early trade.
Indian stocks may remain volatile this week as traders roll over positions in the futures & options (F&O) segment from the near month May 2015 series to June 2015 series. The near month May 2015 F&O contracts expire on Thursday, 28 May 2015.
Foreign portfolio investors bought shares worth a net Rs 74.14 crore yesterday, 25 May 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 0.17 crore yesterday, 25 May 2015, as per provisional data released by the stock exchanges.
In the overseas markets, Asian stocks edged higher.
At 11:15 IST, the S&P BSE Sensex was down 59.50 points or 0.22% at 27,584.38. The index lost 100.64 points at the day's low of 27,543.24 in early trade, its lowest level since 18 May 2015. The index rose 32.06 points at the day's high of 27,675.94 in early trade.
The Nifty was down 14.85 points or 0.18% at 8,355.40. The index hit a low of 8,337.50 in intraday trade, its lowest level since 19 May 2015. The index hit a high of 8,378.90 in intraday trade.
The BSE Mid-Cap index was down 4.35 points or 0.04% at 10,606.76. The decline in this index was lower than the Sensex's decline in percentage terms. The BSE Small-Cap index was up 1.45 points or 0.01% at 11,184.83, outperforming the Sensex.
The market breadth indicating the overall health of the market turned negative from positive in mid-morning trade. On BSE, 1,022 shares fell and 1,011 shares rose. A total of 106 shares were unchanged.
Bank stocks declined. Among public sector banks, Canara Bank (down 1.47%), United Bank of India (down 0.8%), IDBI Bank (down 0.66%), Punjab National Bank (down 0.6%), Syndicate Bank (down 0.41%), Union Bank of India (down 0.37%), Bank of Baroda (down 0.54%) and Bank of India (down 0.25%) edged lower. State Bank of India (up 0.5%) edged higher.
Among private sector banks, ICICI Bank (down 0.66%), IndusInd Bank (down 0.06%), Yes Bank (down 0.17%) and HDFC Bank (down 0.01%) edged lower. Axis Bank (up 0.26%) and Kotak Mahindra Bank (up 0.09%) edged higher.
Tata Motors edged lower ahead of its Q4 March 2015 results today, 26 May 2015. The stock was off 1.99% at Rs 495.15. The stock hit a high of Rs 505.50 and a low of Rs 494.75 so far during the day.
Bharat Heavy Electricals (Bhel) dropped amid volatility ahead of its Q4 March 2015 earnings today, 26 May 2015. The stock was off 0.32% at Rs 233.50. The stock hit a high of Rs 234.65 and a low of Rs 230.10 so far during the day.
Meanwhile, Reserve Bank of India (RBI) Governor Dr. Raghuram G. Rajan yesterday, 25 May 2015, said that while India's macro economic parameters have improved, growth was still slow in picking up. Rajan stated this in Mumbai while inaugurating the Conference of the Chief Secretaries/Finance Secretaries and select Cooperative Secretaries of States. Emphasising the importance of fiscal consolidation in terms of both quantitative and qualitative dimensions, he added that the state governments would have a critical role in improving the consolidated fiscal performance of the government sector as a whole. He highlighted the need for improvement in governance structure, capitalisation and resolution mechanism in the cooperative banking sector which plays a crucial role in credit flow to disadvantaged groups, especially in rural areas.
Meanwhile, Finance Minister Arun Jaitley yesterday, 25 May 2015, said India has to bring the tax rate to global level while at the same time remove the exemptions. The Finance Minister stated this in his key note address after inaugurating the Thirty First Annual Conference of Principal Chief Commissioners, Principal Director Generals, Chief Commissioners and Director Generals of Income Tax in New Delhi. He said that the honest tax payers should not be afraid of the Black Money Bill recently passed by the Parliament as it is targeted against those who have stalked their illegal assets abroad. He said that parallel economy has to be squeezed in a free and transparent manner.
In the overseas markets, Asian stocks edged higher today, 26 May 2015. Key indices in Japan, Taiwan, Singapore, South Korea and Indonesia were up 0.02% to 1%.
Hong Kong stocks climbed, catching up with gains in Shanghai yesterday, 25 May 2015, when the Hong Kong market was closed for holiday. The Hang Seng Index was up 1.34%. In mainland China, the Shanghai Composite Index crept higher in choppy trading. The index was currently up 1.37%. The Shanghai Composite Index had jumped 3.4% yesterday, 25 May 2015, bolstered by news that China plans to launch in July a mutual-fund recognition program between Hong Kong and mainland China, which will allow cross-border sales of funds between the two markets. Meanwhile, markets also got a boost from a state media report yesterday, 25 May 2015, which said China has developed a plan to reform the national pension fund system, allowing possibly hundreds of billions of dollars from the fund to invest in domestic stock markets.
The US stock market was closed yesterday, 25 May 2015, for the Memorial Day Holiday.
Federal Reserve Vice Chairman Stanley Fischer said yesterday, 25 May 2015, that the central bank expects to follow a gradual and relatively slow trajectory of short-term interest-rate increases over the next three to four years to bring borrowing costs back to normal levels. Fischer said observers focus too much on when the Fed will start raising its benchmark short-term rate from near zero, and instead should think more about where interest rates are headed over time. He said Fed economists expect the rate will reach from 3.25% to 4% in three to four years.
Fischer said the coming Fed rate increases will be a gradual process. He said it would not be like the relatively rapid and predictable path of Fed rate increases from 2004 to 2006, when the benchmark rate rose by 0.25 percentage point at each of 11 consecutive monetary policy meetings. His comments echoed those of Fed Chairwoman Janet Yellen, who said last week that US central bank is on track to raise interest rates this year but will likely proceed cautiously because the job market hasn't fully healed, inflation is low and growth has again disappointed.
In Europe, a Greek government spokesman reportedly said yesterday, 25 May 2015, that Greece intends to keep repaying its debt. His comments came after Interior Minister Nikos Voutsis on Sunday, 24 May 2015, warned that the government won't have the money it is due to repay the International Monetary Fund (IMF) next month unless it strikes a deal with international creditors over further rescue funding. Greece is scheduled to repay euro 1.6 billion ($1.76 billion) to the IMF between 5 June and 19 June 2015.
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