Key benchmark indices languished in red in mid-morning trade. The barometer index, the S&P BSE Sensex, was currently off 42.03 points or 0.15% at 28,401.98. The broad market depicted strength. The market breadth indicating the overall health of the market was strong with more than two gainers for every loser on BSE. The BSE Mid-Cap index was up 1.4%. The BSE Small-Cap index was up 1.44%. Both these indices outperformed the Sensex. Meanwhile, a monthly survey released today, 3 December 2014, showed a pick in activity at Indian services companies last month.
Bank stocks gained across the board, with Axis Bank, ICICI Bank and Yes Bank hitting record high. Power equipment major Bharat Heavy Electricals (Bhel) extended initial gains after the company said it has successfully commission India's first indigenously-developed Phase Shifting Transformer (PST).
Foreign portfolio investors (FPIs) bought shares worth a net Rs 106.82 crore yesterday, 2 December 2014, as per provisional data.
In overseas markets, Asian stocks edged higher after US stocks edged higher overnight. US stocks edged higher yesterday, 2 December 2014, sending the Dow Jones Industrial Average to a record, as biotechnology and energy companies rallied and data on construction spending boosted confidence in the economy.
In the foreign exchange market, the rupee edged lower against the dollar.
Brent crude oil futures edged higher after a steep slide during the previous trading session.
At 11:15 IST, the S&P BSE Sensex was down 42.03 points or 0.15% at 28,401.98. The index fell 73.28 points at the day's low of 28,370.73 in morning trade, its lowest level since 27 November 2014. The index gained 60.64 points at the day's high of 28,504.65 at onset of the day's trading session.
The CNX Nifty was down 3.70 points or 0.04% at 8,521. The index hit a low of 8,508.35 in intraday trade. The index hit a high of 8,540.60 in intraday trade.
The market breadth indicating the overall health of the market was strong with more than two gainers for every loser. On BSE, 1,655 shares gained and 708 shares fell. A total of 82 shares were unchanged.
The BSE Mid-Cap index was up 144.74 points or 1.4% at 10,500.85. The BSE Small-Cap index was up 161.70 points or 1.44% at 11,412.91. Both these indices outperformed the Sensex.
The total turnover on BSE amounted to Rs 1368 crore by 11:15 IST compared to Rs 962 crore by 10:15 IST.
Power equipment major Bharat Heavy Electricals (Bhel) surged 4.15% to Rs 282.85, with the stock extending initial gains. Bhel during trading hours today, 3 December 2014, said it has successfully commission India's first indigenously-developed Phase Shifting Transformer (PST) at Kothagudem Thermal Power Station (KTPS) in Telangana. The remarkable benefits derived by transmission networks through deployment of PST, is an outstanding Smart Grid solution in true sense, Bhel said. This is a major development and has opened a new line of business for Bhel, the company said.
Bank stocks gained across the board on renewed buying. Among private bank stocks, Kotak Mahindra Bank (up 0.37%), IndusInd Bank (up 2.52%) and ING Vysya Bank (up 1.46%) rose. HDFC Bank shed 0.59%.
Axis Bank rose 1.05% to Rs 497.40 after scaling a record high of Rs 499 in intraday trade.
ICICI Bank rose 0.6% to Rs 1,781.15 after scaling a record high of Rs 1,787.50 in intraday trade.
Yes Bank surged 3.84% to Rs 745.60 after scaling a record high of Rs 750 in intraday trade.
Among PSU bank stocks, State Bank of India (SBI) (up 0.77%), Andhra Bank (up 0.79%), Punjab National Bank (up 0.98%), Bank of Baroda (up 0.91%), Canara Bank (up 2.2%), Bank of India (up 1.83%) and Union Bank of India (up 3.65%) gained.
A high level official panel headed by Parthasarathi Shome in its report submitted to the government yesterday, 2 December 2014, said that there is no instrument at present that captures details of cash withdrawals from bank accounts, other than savings accounts. The availability of such information would help the Income Tax department widen its information base on the use of black money since excessive cash withdrawal can help it understand the extent of the cash economy. Hence, Rule 114E of the Income Tax Act should be suitably revised to include in its ambit cash withdrawals exceeding specified amounts in a day from bank accounts other than savings accounts, the committee said. Alternatively, the banking cash transaction tax should be reinstated as an effective administrative measure, the committee said.
JSW Steel rose 0.14%. Bhushan Steel rose 1.35%. With reference to media reports captioned JSW Steel to acquire Bhushan Steel Odisha steel unit/JSW Steel keen to acquire steel and mining assets of Bhushan Group, JSW Steel during market hours today, 3 December 2014 said that the news item is of a speculative nature.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 61.905, compared with its close of 61.89 during the previous trading session.
Brent crude oil rebounded today, 3 December 2014, recouping some of its losses from the previous session as a turbulent market struggled to find a price floor. Brent for January settlement was up 51 cents a barrel at $71.05 a barrel. The contract had dropped $2 a barrel to settle at $70.54 during the previous trading session.
Meanwhile, a monthly survey released today, 3 December 2014, showed a pick in activity at Indian services companies last month. Rising from 50 in October to 52.6 in November, the seasonally adjusted HSBC India Services PMI Business Activity Index - a single question tracking changes in activity at Indian services companies on a month - by - month basis - was consistent with a solid expansion in service sector activity in November. Moreover, the latest reading was the highest in five months, albeit below the series average. Commenting on the India Services PMI survey, Pranjul Bhandari, Chief India Economist at HSBC said: Service sector activity grew in November, as new business rose for the seventh month running. Despite the uptick in order flows, business sentiment deteriorated, reminding us that continued policy action that addresses investor concerns is needed to sustain growth momentum. Meanwhile, prices dipped on falling commodity prices and increased competition".
The Ministry of Finance after trading hours yesterday, 2 December 2014, said that it is encouraging that the Reserve Bank of India (RBI) has taken note of the structural change in the outlook for inflation. Responding to the Monetary Policy Statement issued by the RBI, the finance ministry said that the government looks forward to the RBI supporting the revival of growth and employment. In the weeks ahead, the government and RBI will work towards a monetary policy framework that will help institutionalize the gains achieved on the inflation front, so as to reduce inflationary expectations and further support the revival of investment and growth, the finance ministry said in a statement.
The RBI kept its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review, yesterday, 2 December 2014, saying it still needs more proof that inflation is under control before it can start lowering lending rates. In the statement accompanying the rate decision, RBI Governor Raghuram Rajan said that the current slowdown in consumer prices may be short-lived. Rajan said the risk to the January 2016 target of 6% appear evenly balanced under the current policy stance.
The Indian government intends to get the Insurance Laws Amendment Bill that seeks to enhance FDI limit in capital starved insurance sector passed during the winter session of parliament which began on 24 November 2014. The government is also likely to introduce the constitutional amendment bill for the goods & services tax in the winter session of parliament.
Asian stocks edged higher today, 3 December 2014 as US automakers posted better-than-estimated car sales in November 2014. Key benchmark indices in Singapore, Taiwan, Japan, and South Korea rose by 0.26% to 1.55%. Key benchmark indices in China, Indonesia and Hong Kong were off 0.3% to 0.77%.
The HSBC China services purchasing managers index rose to 53 in November from 52.9 in October, HSBC Holdings PLC said today, 3 December 2014 pointing to modest economic resilience outside the nation's factory sector. A reading above 50 indicates month-to-month expansion while a level below that points to contraction. New orders in the service sector grew at their fastest pace in 30 months, compared with a much weaker showing in factory activity, HSBC said.
Meanwhile, China's official nonmanufacturing purchasing managers' index rose to 53.9 in November from 53.8 in October, data from the China Federation of Logistics and Purchasing showed today, 3 December 2014.
Trading in US index futures indicated a flat opening of US stocks today, 3 December 2014. US stocks edged higher on Tuesday, 2 December 2014 sending the Dow Jones Industrial Average to a record, as biotechnology and energy companies rallied and data on construction spending boosted confidence in the economy.
November car and light truck sales were second-highest in eight years, according to figures from Autodata. Sales rose to a seasonally adjusted annual rate of 17.2 million in November, up from 16.5 million in October and the best level since August.
In economic news, data released on Tuesday, 2 December 2014 showed construction spending grew more than estimated in October. Construction spending rose 1.1% in October to a seasonally adjusted annual rate of $971 million.
The European Central Bank (ECB) will meet tomorrow, 4 December 2014 to discuss monetary policy. The ECB has pledged more stimulus if needed to revive inflation.
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