Key benchmark indices extended initial gains as the rupee edged higher against the dollar. The barometer index, the S&P BSE Sensex, was up 109.04 points or 0.52%, up about 110 points from the day's low and off close to 20 points from the day's high. The market breadth, indicating the overall health of the market, was strong. All the thirteen sectoral indices on BSE were in the green.
Shares of public sector oil refining-cum-marketing companies (PSU OMCs) as their under-recovery on diesel declined for the first forgnight of January 2014 and after they reportedly hiked the price of non-subsidised cooking gas (LPG) by a steep Rs 220 per cylinder on Wednesday on firming international rates.
At 9:30 IST, the S&P BSE Sensex was up 109.04 points or 0.52% to 21,249.52. The index jumped 127.54 points at the day's high of 21,268.02 in early trade. The index rose 0.10 points at the day's low 21,140.58 in early trade.
The CNX Nifty was up 28.20 points or 0.42% to 6,327.85. The index hit a high of 6,328.55 in intraday trade. The index hit a low of 6,300.65 in intraday trade.
The market breadth, indicating the overall health of the market, was strong. On BSE, 913 shares gained and 212 shares fell. A total of 37 shares were unchanged.
Among the 30-share Sensex pack, 27 stocks gained and rest of them declined. HDFC (up 1.19%), ONGC (up 0.99%) and HDFC Bank (up 0.8%) gained.
Shares of public sector oil refining-cum-marketing companies (PSU OMCs) rose after the Petroleum Planning and Analysis Cell (PPAC) under the Ministry of Petroleum and Natural Gas on Wednesday, 1 January 2014, said that the under-recovery on High Speed Diesel (HSD) applicable for first fortnight of January 2014 fell to Rs 9.74 per/litre, from Rs 10.48 per litre during the second fortnight of December 2013. HPCL (up 1.09%), BPCL (up 1.09%) and Indian Oil Corporation (up 0.96%) gained.
The under-recovery on PDS Kerosene rose to Rs 37.33 per litre for the month of January 2014, from 36.20/litre for December 2013. The under-recovery on Domestic LPG rose to Rs 762.70 per cylinder for January 2014, from Rs 542.71/cylinder for December 2013. PSU OMCs are now incurring combined daily under-recovery of about Rs 481 crore on the sale of Diesel, PDS Kerosene and Domestic LPG at government controlled prices. This is a higher than the Rs 434-crore daily under-recoveries during the second fortnight of December 2013.
PSU OMCs reported a total of Rs 60907 crore as under-recoveries during first half of 2013-14 on Diesel, PDS Kerosene and Domestic LPG, the Ministry of Petroleum and Natural Gas said.
PSU OMCs reportedly on Wednesday, 1 January 2014, increased the price of aviation turbine fuel (ATF) by 2.7%.
The price of non-subsidised cooking gas (LPG), which customers buy after consuming their quota of subsidised cylinders, was hiked by a steep Rs 220 per bottle on Wednesday on firming international rates. The 14.2-kg cooking gas cylinder that consumers buy beyond their entitled nine bottles at subsidised rates, will now cost Rs 1,241, up from Rs 1,021. This is the third increase in non-subsidised LPG rates in the past month. The price was hiked by Rs 63 a cylinder to Rs 1,017.50 on 1 December 2013.
PSU OMCs suffer under recoveries on domestic sale of diesel, LPG and kerosene at controlled prices. In January 2013, the government allowed PSU OMCs to raise diesel prices in small measures at regular intervals while completely deregulating diesel prices sold to institutional or bulk buyers. The government has already freed pricing of petrol.
Shares of GAIL (India) rose 0.47%.
Shares of buses makers were mixed after the Ministry of Urban Development on Wednesday, 1 January 2014, said it has sanctioned buses to a total of 13 cities/cluster of cities after the Central Sanctioning & Monitoring Committee Meeting held on 31 December 2013. Tata Motors fell 0.52%. Ashok Leyland rose 1.16%.
The State Govt. has to procure these buses as per the urban bus specifications-II which has been prepared by the Ministry of Urban Development recently, the ministry said in a statement. The first instalment of Government of India share will be released to the State after submission of information/documents within three months as per the conditions given in bus funding guidelines, it said.
The objective behind sanctioning of these buses is to improve the city transport system, to give Metro experience to public in these modern ITS enabled buses and to attract the public to use Public Transport, the urban transport ministry said. The JNNURM buses will change the face of the Urban Transport of these 13 cities and will help in the overall growth of the State/UT, it said.
These cities have also been sanctioned projects relating to ancillary infrastructure viz. Depot, Workshops, ITS etc. for Urban Transport. In addition, ancillary infrastructure project for Bathinda has also been approved. The total estimated project cost for these 13 cities/cluster of cities is about Rs 464 crore.
In the foreign exchange market, the rupee edged higher against the dollar in early trade. The partially convertible rupee was hovering at 61.755, compared with its close of 61.90/91 on Wednesday, 1 January 2014.
Markit Economics will unveil HSBC India Manufacturing PMI, which gauges the business activity of India's factories, for December 2013 today, 2 January 2014. The HSBC Manufacturing PMI, compiled by Markit, rose to 51.3 in November from October's 49.6. The PMI reading was the highest since March and marked its first time above the watershed level of 50 that divides growth from contraction in four months.
The next major trigger for the market is Q3 December 2013 corporate earnings. The Q3 earnings season will begin around mid-January 2014 and continue till mid-February 2014. Investors and analysts will closely watch the management commentary that would accompany the result to see if there is any revision in their future earnings forecast of the company for the current year and/or the next year.
The Reserve Bank of India's Third Quarter Review of Monetary Policy for 2013-14 is scheduled on 28 January 2014.
Asian stocks edged lower on Thursday, 2 January 2014, after gauges of manufacturing in China declined. Key benchmark indices in China, Hong Kong, Taiwan and South Korea were off 0.12% to 1.42%. Key benchmark indices in Singapore and Indonesia were up 0.17% to 0.98%. Japanese stock markets were closed for holiday.
China's manufacturing purchasing managers' index came in at 51 for December, the National Bureau of Statistics and the nation's logistics federation said yesterday, 1 January 2014. A separate manufacturing PMI report from HSBC Holdings Plc and Markit Economics today showed the gauge coming in at 50.5, from 50.8 in November.
Singapore's economy contracted more than expected in the fourth quarter as manufacturing activity weakened, data showed on Thursday, casting some doubt on market expectations for a slight pick-up in growth over 2014. According to advance estimates from Singapore's Ministry of Trade and Industry, GDP contracted an annualised and seasonally adjusted 2.7% in the final quarter of 2013 from the July-September period. That reversed a 2.2% expansion in the third quarter.
The US stock market was closed on Wednesday, 1 January 2014, for New Year's Day holiday.
The US Federal Reserve said after a two-day monetary policy review on 18 December 2013 that it will cut its monthly bond purchases to $75 billion from $85 billion starting in January 2014 amid an improved outlook for the job market in the world's largest economy. The US central bank is poised to continue winding down its stimulus measures gradually over the next year.
The Federal Open Market Committee (FOMC) holds a two-day monetary policy meeting on 28 and 29 January 2014.
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