Positive cues from world markets helped key equity benchmark indices in India register modest gains. The market breadth indicating the overall health of the market turned positive from negative in late trade. The barometer index, the S&P BSE Sensex, was provisionally up 138.80 points or 0.52% at 26,631.31. BSE Small-Cap and Mid-Cap indices, both, reversed intraday losses in late trade. IT and capital goods stocks gained. Cement stocks gained on hopes demand will pick up as construction activity will be in full swing as the southwest monsoon starts withdrawing.
Benchmark indices witnessed intermittent volatility within positive zone in intraday trade after a higher opening triggered by firm Asian stocks and after the Dow Jones Industrial Average hit an intraday record high overnight.
In overseas markets, European stocks edged higher ahead of the Federal Reserve's decision on monetary policy. Asian stocks rose on a report China's central bank is boosting stimulus. Investors across the globe are awaiting the outcome on the Federal Reserve's two-day policy meeting that concludes today, 17 September 2014, to gauge the timing of interest rate hike in the US. The Fed is likely to raise short-term interest rates next year from their current near-zero levels, where they have been since December 2008.
Key indices snapped two-day losing streak today, 17 September 2014.
In the foreign exchange market, the rupee was a tad higher against the dollar.
Brent crude oil prices edged higher in choppy trade.
As per provisional figures, the S&P BSE Sensex was up 138.80 points or 0.52% at 26,631.31. The index jumped 190.13 points at the day's high of 26,682.64 in morning trade. The index rose 19.20 points at the day's low of 26,511.71 in morning trade.
The CNX Nifty was up 41.85 points or 0.53% at 7,974.75, as per provisional figures. The index hit a high of 7,990.65 in intraday trade. The index hit a low of 7,936.95 in intraday trade.
The total turnover on BSE amounted to Rs 3880 crore, lower than Rs 4368.82 crore on Tuesday, 16 September 2014.
The market breadth indicating the overall health of the market was turned positive from negative in late trade. On BSE, 1,533 shares rose and 1,480 shares fell. A total of 105 shares were unchanged.
The BSE Mid-Cap index was up 24.61 points or 0.25% at 9,683.92. The BSE Small-Cap index was up 33.53 points or 0.31% at 10,829.84. Both these indices underperformed the Sensex.
IT stocks edged higher. HCL Technologies gained 1.85%.
Infosys rose 2.42%, with the stock extending Tuesday's gains. The company said during market hours on Tuesday, 16 September 2014, that Muji, a leading retailer in Japan, has deployed InteractEdge from Infosys which will enable Muji to deliver a superior shopping experience through real time insights into the buying behaviour of its customers.
Tata Consultancy Services (TCS) gained 1.19%.
Wipro rose 1.83%. Wipro early this week said that the company's subsidiary Wipro Arabia has entered into a strategic partnership with Saudi-based Saudi Electricity Company (SEC), the largest power utility company in the Middle East serving approximately 5 million customers in the Kingdom of Saudi Arabia (KSA). As part of this engagement, Wipro will implement and rollout the plant maintenance and project system functionality of the SAP ERP application for SEC's distribution business line across KSA.
Tech Mahindra gained 0.34%.
Cement stocks gained on hopes demand will pick up as construction activity will be in full swing as the southwest monsoon starts withdrawing. ACC (up 0.59%), Ambuja Cements (up 1.23%), and UltraTech Cement (up 1.8%), gained.
Shree Cement fell 0.23%.
Grasim Industries declined 0.49%. Grasim has exposure to the cement sector through its subsidiary UltraTech Cement.
Capital goods stocks gained. ABB (India) (up 7.07%), Bharat Heavy Electricals (Bhel) (up 2.06%), BEML (up 0.82%), Bharat Electronics (up 1.56%), Crompton Greaves (up 3.93%), L&T (up 0.09%), Punj Lloyd (up 0.38%) and Siemens (up 3.55%) gained.
Asian Paints dropped 0.52%. The company said during market hours that the board of directors of the company at its meeting held today, 17 September 2014, recommended payment of interim dividend of Rs 1.80 per share for the year ending 31 March 2015.
In the foreign exchange market, the rupee was a tad higher against the dollar. The partially convertible rupee was hovering at 60.985, compared with its close of 61.06 during the previous trading session.
Brent crude oil prices edged higher in choppy trade after staging its steepest climb in two weeks in the previous session triggered by hopes the Organization of the Petroleum Exporting Countries (OPEC) will cut output and reduce a global supply glut. Brent for November settlement was up 22 cents at $99.27 a barrel. The contract had risen $2.4 a barrel or 1.2% to settle at $99.05 a barrel on Tuesday, 16 September 2014.
Chinese President Xi Jinping arrived in India today afternoon for a three-day official visit. The Chinese President is expected to pledge billions of dollars for railways, industrial parks and roads in India, according to reports.
On the political front, the ruling government led by Bharatiya Janata Party (BJP) suffered a major blow in the Assembly by-elections in Uttar Pradesh, Rajasthan and Gujarat, the states it had swept in the Lok Sabha polls four months ago, losing 13 of the 24 seats held by it. The results of the by-elections held in nine states were announced on Tuesday, 16 September 2014. Counting in one assembly seat in Chhattisgarh will be held on Saturday, 20 September 2014. Considered yet another test of popularity of Prime Minister Narendra Modi, reversal in the outcome of by-elections come after the party's disappointing performance in the assembly by-elections in Bihar, Uttarakhand, Karnataka and Madhya Pradesh in the last two months.
European stocks edged higher today, 17 September 2014, before the US Federal Reserve's decision on monetary policy. Key benchmark indices in UK, France and Germany were 0.9% to 0.62%.
Euro area inflation was higher than initially forecast in August, easing pressure on the European Central Bank after it took action to shield the region from the threat of a downward spiral in prices. Annual inflation was 0.4%, unchanged from July, the European Union's statistics office in Luxembourg said today. That's above Eurostat's Aug. 29 estimate of 0.3%, which was the lowest reading in almost five years.
UK unemployment has fallen to the lowest in six years, indicating continued strength in the labor market that Bank of England Governor Mark Carney says will eventually boost earnings. The jobless rate based on International Labor Organisation methods fell to 6.2% in the three months through July from 6.4%, a bigger decline than forecast. A separate measure for August put the claimant count rate at 2.9%. Both rates are at their lowest levels since 2008.
Meanwhile, a crucial vote on Scottish independence will be held tomorrow, 18 September 2014. Scotland is currently a part of United Kingdom.
Asian stocks rose today, 17 September 2014, on a report China's central bank is boosting stimulus. Key benchmark indices in Hong Kong, Indonesia, South Korea, Singapore, Taiwan and China were up 0.49% to 1.12%. Japan's Nikkei Average was off 0.14%.
China reportedly provided 500 billion yuan ($81.4 billion) of liquidity to its five biggest banks, as leaders in Asia's largest economy seek to support growth. The People's Bank of China started providing the banks with 100 billion yuan each through standing lending-facilities with tenor of three months. The PBOC will complete the process today, 17 September 2014, according to reports.
Trading in US index futures indicated a flat opening of US stocks on Wednesday, 17 September 2014. US stocks rose on Tuesday, 16 September 2014, with the Dow Jones Industrial Average hitting a record intraday high as markets reacted to wavering expectations over the language the Federal Reserve will use Wednesday, 17 September 2014, to describe its next policy move.
Investors will look to Federal Open Market Committee (FOMC) meeting for fresh guidance on US interest rates. A two-day policy meeting of the Federal Open Market Committee (FOMC) ends today, 17 September 2014. At the end of a two-day meeting, the FOMC is widely expected to announce cut in Fed's monthly bond-buying program by another $10 billion to $15 billion, staying on track to end the program at its October meeting. The Fed is likely to raise short-term interest rates next year from their current near-zero levels, where they have been since December 2008.
The Fed will also announce US economic projections after the policy meet. Fed now releases economic projections four times a year (March, June, September, and December). Traditionally, the Fed forecasts covered GDP, the PCE price index, and the civilian unemployment rate. However, the forecast report additionally now includes forecasts for the appropriate timing of the next change in the fed funds rate and the expected fed funds rate at the end of the next two years. The policy meet will be followed by a press conference by Federal Reserve Chairwoman Janet Yellen on 17 September 2014.
The Federal Reserve after two-day policy meeting on 30 July 2014, said it would reduce its purchases of mortgage and Treasury bonds by $10 billion to $25 billion monthly from $35 billion earlier, as widely expected.
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