Key benchmark indices hovered in green in afternoon trade as European stocks edged higher in early trade there. The market breadth, indicating the overall health of the market, was negative. The barometer index, the S&P BSE Sensex, was currently below the psychological 20,000 mark, having alternately moved above and below that mark in intraday trade. The Sensex was up 85.01 points or 0.43%, up close to 203 points from the day's low and off about 64 points from the day's high.
Telecom stocks were mostly lower after Telecommunications Secretary M.F. Farooqui was quoted by media as saying today, 24 September 2013, that the government expects to conduct its next mobile phone airwave auction in January 2014. State-run telecom services provider Mahanagar Telephone Nigam (MTNL) was locked at 10% upper circuit on reports that the company has signed a pact with Bharat Sanchar Nigam to share infrastructure and provide joint services to corporate customers.
A bout of volatility was witnessed in early trade as key benchmark indices reversed initial losses triggered by weak Asian stocks. Key benchmark indices extended initial gains and hit fresh intraday high in morning trade. The Sensex moved past the psychological 20,000 level. Key benchmark indices regained strength after trimming intraday gains in mid-morning trade. The market regained positive terrain after reversing intraday gains in early afternoon trade.
The market may remain volatile this week as traders roll over positions in the futures & options (F&O) segment from the near month September 2013 series to October 2013 series. The September 2013 F&O contracts expire on Thursday, 26 September 2013.
At 13:15 IST, the S&P BSE Sensex was up 85.01 points or 0.43% to 19,985.97. The index jumped 149.46 points at the day's high of 20,050.42 in morning trade. The index declined 118.18 points at the day's low of 19,782.78 in early trade, its lowest level since 18 September 2013.
The CNX Nifty was up 21.05 points or 0.36% to 5,910.80. The index hit a high of 5,938.40 in intraday trade. The index hit a low of 5,854.55 in intraday trade, its lowest level since 18 September 2013.
The market breadth, indicating the overall health of the market, was negative. On BSE, 1,042 shares dropped and 1,037 shares rose. A total of 147 shares were unchanged.
Among the 30-share Sensex pack, 17 stocks rose and rest of them fell. Bhel (up 2.85%), Tata Power (up 2.15%), Bajaj Auto (up 1.94%), Larsen & Toubro (up 1.92%), Cipla (up 1.82%), HDFC (up 1.81%), M&M (up 1.67%) and Tata Motors (up 1.14%), edged higher from the Sensex pack.
Hindalco Industries (down 1.89%), Bharti Airtel (down 1.55%), Wipro (down 1.45%), Jindal Steel & Power (down 1.17%), Coal India (down 0.95%), Sesa Goa (down 0.92%), TCS (down 0.53%) and State Bank of India (down 0.48%), edged lower from the Sensex pack.
Telecom stocks were mostly lower. Bharti Airtel (down 1.60%), Tata Teleservices (Maharashtra) (down 0.32%) and Reliance Communications (down 0.19%), edged lower. Idea Cellular was up 0.06%.
Telecommunications Secretary M.F. Farooqui was quoted by the media as saying today, 24 September 2013, that the government expects to conduct its next mobile phone airwave auction in January 2014. The government has estimated Rs 11000 crore of revenue from the auction, he added. The telecommunications regulator earlier this month recommended a sharp cut in the auction reserve prices. The reserve prices are yet to be finalised by the government.
Shares of state-run telecom services provider Mahanagar Telephone Nigam (MTNL) were locked at 10% upper circuit at Rs 15.32 on BSE on reports that the company has signed a pact with Bharat Sanchar Nigam to share infrastructure and provide joint services to corporate customers. Under the pact, the two carriers will share assets like buildings, mobile masts and international long-distance phone networks. BSNL operates mobile, fixed-line and Internet services in 20 of India's 22 telecommunications zones, while MTNL operates in the key Delhi and Mumbai zones.
Bond prices rose after the government kept the borrowing target for the fiscal year through March 2014 unchanged at Rs 5.79 lakh crore ($92.49 billion). The yield on the benchmark federal paper 7.16% GS 2023 was hovering at 8.7571%, lower than its close of 8.8505% on Monday, 23 September 2013. Bond prices and bond yields are inversely related.
Economic Affairs Secretary Arvind Mayaram said on Monday, 23 September 2013, that the government will raise Rs 3.44 lakh crore by the end of September. That will be Rs 5000-crore short of the target it had initially set for the first half of the fiscal year, Mr. Mayaram said. The shortfall will be made up in the October-March period, taking the total borrowing during the second half to Rs 2.35 lakh crore, he said.
Mr. Mayaram said that the government would cut spending if revenue falls short of the budget projections, but won't breach the full-year fiscal-deficit target which is 4.8% of gross domestic product for this year. The gap was 4.9% last fiscal year. Last week, the government announced austerity measures to slash nonessential spending, as it sought to reinforce its commitment to meeting the deficit target.
There had been concerns off late that the heavy spending on social-development programs at a time when the government's revenue growth has been hit by a slowdown in the economy would mean that the government may have to increase its borrowing this year. Data late August showed the government's fiscal deficit between April and July reached about 63% of the target it had set for the full fiscal year.
In the foreign exchange market, the rupee reversed initial losses against the dollar. The partially convertible rupee was hovering at 62.53, compared with its close of 62.60/61 on Monday, 23 September 2013. The rupee had hit a low of 62.905 earlier during the session.
European stock markets moved higher at the open on Tuesday, 24 September 2013, as investors awaited the Ifo survey on German business confidence and US housing data. Key benchmark indices in UK, France and Germany were up 0.24% to 0.42%.
German Chancellor Angela Merkel on Sunday, 22 September 2013, won re-election by the largest amount in more than 20 years.
Asian stocks dropped on Tuesday, 24 September 2013, following overnight decline in the US stocks. Key benchmark indices in China, Indonesia, Japan, Hong Kong, Singapore, and South Korea were off 0.01% to 1.79%. Taiwan's Taiwan Weighted rose 0.08%.
Trading in US index futures indicated the Dow could gain 14 points at opening bell on Tuesday, 24 September 2013. US stocks fell on Monday after notching three weeks of gains, as investors heard from Federal Reserve officials and worried about another standoff in Washington. Addressing business leaders in New York Monday morning, Fed Bank of Atlanta President Dennis Lockhart said the economy is losing some steam. Fed Bank of New York President William Dudley told an audience at the Fordham University Graduate School of Business that an accommodative monetary policy is still needed. In a speech about US banking in San Antonio, Federal Reserve Bank of Dallas President Richard Fisher said he advocated slowing down the pace of central-bank asset purchases at last week's policy session.
The Federal Open Market Committee (FOMC) holds a two-day policy meeting on 29-30 October 2013. On 18 September 2013, the Fed surprised economists and investors with its decision to delay scaling back its stimulus.
Political showdown in Washington over the US budget also weighed on US stocks on Monday, 23 September 2013. House Speaker John Boehner and his Republican caucus are pushing the federal government closer to a shutdown in a fight over funding and the debt limit, Democrats Max Baucus and Patty Murray said in a letter to colleagues yesterday, 23 September 2013.
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