Sensex marks first daily gain in 2014

Key benchmark indices edged higher, to mark first daily gain this year and snapping five-session losing streak. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, eked out small gains. The market breadth, indicating the overall health of the market, was positive. The Sensex advanced 36.14 points or 0.17%, off close to 60 points from the day's high and up about 40 points from the day's low.

Indian stocks snapped five-day losing streak today, 8 January 2014. The Sensex had lost 477.44 points or 2.25% in five trading days to settle at 20,693.24 on Tuesday, 7 January 2014, from a recent high of 21,170.68 on 31 December 2013. The Sensex has lost 441.30 points or 2.08% in this month so far (till 8 January 2014). From a 52-week low of 17,448.71 on 28 August 2013, the Sensex has risen 3,280.67 points or 18.8%. From a record high of 21,483.74 hit on 9 December 2013, the Sensex is off 754.36 points or 3.51%.

 

Coming back to today's trade, shares of state-run coal miner Coal India jumped after the company said that a meeting of the board of directors of the company will be held on 14 January 2014, to consider payment of interim dividend for the year ending 31 March 2014. PSU bank stocks were in demand in anticipation of hefty dividend announcement.

Index heavyweight and cigarette major ITC edged lower in volatile trade. Index heavyweight Reliance Industries edged higher in volatile trade. Siemens rose on bargain hunting. Gillette India slumped after the company clarified that it has no plans for an open offer or delisting.

Pharma stocks rose on renewed buying. Cadila Healthcare jumped after a foreign brokerage upgraded the stock to "buy" from "underperform" and raised its target price. But, Ranbaxy Laboratories reversed initial gains triggered by the company's announcement that its wholly owned subsidiary Ranbaxy Pharmaceuticals Canada Inc. (RPCI) has received approval from Health Canada to manufacture and market RAN-Donepezil Hydrochloride 5 mg and 10 mg tablets.

The S&P BSE Sensex garnered 36.14 points or 0.17% to settle at 20,729.38, its highest closing level since 6 January 2014. The index jumped 93.17 points at the day's high of 20,786.41 in late trade. The index fell 5.06 points at the day's low of 20,688.18 in early trade.

The CNX Nifty advanced 12.35 points or 0.2% to 6,174.60, its highest closing level since 6 January 2014. The index hit a high of 6,192.10 in intraday trade. The index hit a low of 6,160.35 in intraday trade.

The BSE Mid-Cap index rose 0.59%. The BSE Small-Cap index gained 0.29%. Both these indices outperformed the Sensex.

The BSE Oil & Gas index (up 0.35%), BSE PSU index (up 0.82%), BSE Metal index (up 0.43%), BSE Auto index (up 0.71%) and BSE HealthCare index (up 1.04%), and BSE Realty index (down 0.44%) outperformed the Sensex.

The BSE Power index (down 0.03%), BSE IT index (up 0.08%), BSE Bankex (up 0.14%), BSE Capital Goods index (down 1.35%), and BSE Consumer Durables index (down 0.58%), underperformed the Sensex.

The BSE FMCG index rose 0.17% and matched with Sensex's performance.

The total turnover on BSE amounted to Rs 2334 crore, lower than Rs 2354 crore on Tuesday, 7 January 2014.

The market breadth, indicating the overall health of the market, was positive. On BSE, 1,514 shares gained and 1,057 shares fell. A total of 160 shares were unchanged.

Among the 30-share Sensex pack, 16 stocks gained and rest of them declined.

Index heavyweight and cigarette major ITC shed 0.24% to Rs 316. The stock hit a high of Rs 317.80 and low of Rs 313.90.

Index heavyweight Reliance Industries rose 0.68% to Rs 847.90. The stock hit a high of Rs 856.50 and low of Rs 844.60.

Shares of state-run coal miner Coal India jumped 4.72% to Rs 288.60 after the company said that a meeting of the board of directors of the company will be held on 14 January, 2014, inter alia, to consider payment of interim dividend, if any, for the year ending 31 March 2014. The announcement sent the stock surging as the market has been abuzz with rumours that the government may force cash rich state-run firms to declare hefty interim dividend to enable the government to meet the fiscal deficit target for the current year.

Coal India has fixed 20 January 2014 as the record date for the purpose of payment of interim divided.

PSU bank stocks were in demand. Canara Bank (up 1.84%), Punjab National Bank (up 1.63%), Bank of Baroda (up 2.15%), Bank of India (up 4.93%) gained. State Bank of India (SBI) shed 0.44%.

Syndicate Bank jumped 7.98%. Syndicate Bank's board will meet on 9 January 2014, to consider payment of interim dividend for the year ending 31 March 2014.

Allahabad Bank jumped 7.44%. Allahabad Bank's board will meet on 11 January 2014, to consider payment of interim dividend for the year ending 31 March 2014.

Union Bank of India gained 4.28%. Union Bank of India's board will meet today, 8 January 2014, to consider payment of interim dividend for the year ending 31 March 2014.

IDBI Bank gained 4.05%. IDBI Bank's board will meet on 13 January 2014 to consider payment of interim dividend for the year ending 31 March 2014.

Indian Bank shed 0.27%. Indian Bank's board will meet on 10 January 2014, to consider payment of interim dividend for the year ending 31 March 2014.

Pharma stocks were in demand on renewed buying. Cipla (up 3.43%), Dr Reddy's Laboratories (up 1.62%), Lupin (up 0.62%), Sun Pharmaceutical Industries (up 1.05%) and Wockhardt (up 3.83%) gained.

Cadila Healthcare jumped 5.61% to Rs 851.40 after a foreign brokerage upgraded the stock to "buy" from "underperform" and raised its target price to Rs 1,000 per share from Rs 705 per share, saying the worst is behind and earnings will accelerate from fiscal 2015. The brokerage expects Cadila to get 20 or more drug approvals from the US Food and Drug Administration (USFDA), and expects Cadila's domestic sales to recover in fiscal 2015.

Ranbaxy Laboratories fell 1.64% to Rs 473.05 in volatile trade. The stock hit a high of Rs 485.50 and low of Rs 473. Ranbaxy Pharmaceuticals Canada Inc. (RPCI), a wholly owned subsidiary of Ranbaxy Laboratories (RLL), today, 8 January 2014, announced that RPCI received approval from Health Canada on 24 December 2013 to manufacture and market RAN-Donepezil Hydrochloride 5 mg and 10 mg tablets. The total market size of Aricept (Donepezil Hydrochloride) in Canada is $153.9 million ($ CAD) [IMS-CDH: November 2013] and growing at 38% (extended units). Donepezil Hydrochloride is indicated in the treatment of dementia in Alzheimer's patients.

Ranbaxy Pharmaceuticals Canada Inc. (RPCI) based in Mississauga, Ontario, Canada, is a wholly owned subsidiary of Ranbaxy Laboratories (RLL). RPCI is engaged in the sale and distribution of generic prescription products in the Canadian healthcare system.

Oil India (OIL) fell 0.05%. ONGC declined 1.09%. Videocon Industries gained 0.79%. OIL after market hours on Tuesday, 7 January 2014, announced that the company along with ONGC Videsh (OVL) has completed the acquisition of 100% shares in Videocon Mozambique Rovuma 1 Limited from Videocon Mauritius Energy. It may be recalled that OIL and OVL had 25 June 2013 announced the signing of definitive agreements to acquire this interest. The terms of the transaction remain broadly the same as per the earlier announcement, OIL said.

Area 1 covers approximately 2.6 million acres in the deepwater Rovuma Basin offshore Mozambique and represents the largest gas discovery offshore East Africa with estimated recoverable resources of between 35 and 65 TCF as per operator's estimates. Partners in Area 1 include Anadarko, operator of the project, ENH, Mitsui, BPRL and PTTEP. Area 1 has the potential to become one of the world's largest LNG producing hubs with first LNG expected in 2018.

The Area 1 LNG project is strategically located to competitively supply LNG to India, and OIL's and OVL's participation in the project will facilitate access to the growing Indian gas market which will supplement the country's energy security endeavour, OIL said in a statement. OIL and OVL will also devote significant financial and technical resources to the development of the project. This investment is expected to further enhance the strong business and cultural links between Mozambique and India, OIL said.

Tata Power Company rose 2.01% to Rs 81.15, with the stock recovering on bargain hunting after recent steep slide triggered by media reports that the state government in Maharashtra is planning to cut power tariffs.

Shares of Tata Power had declined 12.91% in five trading sessions to settle at Rs 79.55 on Tuesday, 7 January 2014, from a recent high of Rs 91.35 on 31 December 2013.

According to reports, the cut in power tariffs in Maharashtra would be only for farmers, domestic consumers and small businesses consuming less than a set amount of electricity.

A cut in power tariff in Maharashtra would come after the ruling Aam Aadmi Party's push in Delhi to cut power tariff in the state.

Capital goods stocks edged lower. L&T (down 2.03%), Bhel (down 1.33%), BEML (down 4.94%) and Crompton Greaves (down 2.05%) declined.

Siemens rose 1.04% to Rs 631, with the stock recovering on bargain hunting. Shares of Siemens had declined 5.93% in four trading sessions to settle at Rs 624.50 on Tuesday, 7 January 2014, from a recent high of Rs 663.90 on 1 January 2014.

Auto stocks were mixed. Ashok Leyland fell 0.54%.

Maruti Suzuki India fell 0.4% to Rs 1,839.15, with the stock reversing gains after hitting record high of Rs 1,859.75 in intraday trade. The company after market hours on Tuesday, 7 January 2014, said that its production fell 6.8% to 80,698 units in December 2013 over December 2012. The company had said last week its total vehicles sales declined 4.4% to 90,924 units in December 2013 over December 2012.

Tata Motors (up 1.36%) and M&M (up 0.46%) gained.

Shares of two wheeler makers declined. Hero MotoCorp shed 0.14%.

TVS Motor Company fell 0.2%.

Bajaj Auto rose 1.49% to Rs 1,918.25 after three bulk deals were executed on the counter on BSE today, 8 January 2014. A bulk deal of 55,181 shares was executed at Rs 1,902.15 per share at 9:47 IST. One more bulk deal of 55,182 shares was executed at Rs 1,895.80 per share at 9:47 IST. Another bulk deal of 1 lakh shares was executed at Rs 1,902.50 per share at 10:36 IST.

HCL Technologies fell 0.48% to Rs 1,249.15, with the stock reversing gains after hitting record high of Rs 1,277 in intraday trade.

Infosys declined 0.84%. Infosys unveils Q3 December 2013 results on Friday, 10 January 2014. At the time of announcement of Q2 September 2013 results in October 2013, Infosys had raised its revenue guidance in both dollar and rupee terms. The increase in revenue growth guidance in rupee terms was driven by weakness in rupee against the dollar. At that time, the company had issued a forecast of 21% to 22% growth in revenue in rupee terms based on the assumption of rupee dollar conversion rate of 62.61 for the rest of the fiscal year. The company had at that time forecast 9% to 10% growth in revenue in dollar terms for the year ending 31 March 2014 (FY 2014).

Tata Consultancy Services (TCS) gained 1.12%.

Tech Mahindra advanced 1.93%.

Wipro declined 0.66%.

JSW Steel fell 0.16%. The company during market hours unveiled production data for December 2013. JSW Steel's crude steel production rose 11% to 1.05 million tonnes in December 2013 over December 2012. Production of flat rolled products rose 6% to 0.87 million tonnes in December 2013 over December 2012. Production of long rolled products declined 1% to 0.15 million tonnes in December 2013 over December 2012. JSW Steel said that the figures are after giving effect to the merger of JSW ISPAT Steel with the company.

Gillette India slumped 5.42% to Rs 2,086 after the company clarified that it has no plans for an open offer or delisting. The company issued the clarification during trading hours today, 8 January 2014.

A media report suggested that investors have been speculating about a possible open offer and delisting of Gillette India. The firm's shares have risen sharply in the past few days on high volumes on buzz that such an offer is imminent.

Shares of Gillette India rose 9.04% in the preceding three trading sessions to Rs 2,205.45 on Tuesday, 7 January 2014, from a recent low of Rs 2,022.65 on 2 January 2014.

However, Gillette India clarified to the bourses that it has no plans for an open offer or delisting. "In fact, the company has recently successfully completed a sell-down of shares to deliver compliance with SEBI's minimum public shareholding requirement," Gillette India said in a statement.

As on 30 December 2013, promoters held 75% in Gillette India.

Tyre shares edged higher. JK Tyre & Industries (up 0.32%), Goodyear India (up 4.02%) and TVS Srichakra (up 2.08%) gained.

Apollo Tyres jumped 5.88% to Rs 112.55 after striking record high of Rs 113.70 in intraday trade. High volumes accompanied the rally in the counter. On BSE, 80.35 lakh shares were traded in the counter, compared with average daily volume of 13.01 lakh shares during the past one quarter.

Apollo Tyres late last month issued a press statement in response to Cooper Tire & Rubber Company's decision to terminate merger agreement with Apollo Tyres. The company said that the management is disappointed as Cooper has prematurely attempted to terminate the merger agreement. While Cooper's lack of control over its largest Chinese subsidiary -- Cooper Chengshan Tire Company -- and its inability to meet its legal and contractual financial reporting obligations has considerably complicated the situation, Apollo has made exhaustive efforts to find a sensible way forward over the past several months, Apollo Tyres said. However, Cooper has been unwilling to work constructively to complete a transaction that would have created value for both the companies and their shareholders, Apollo Tyres said. Cooper's actions leave Apollo no choice but to pursue legal remedies for Cooper's detrimental conduct, Apollo Tyres said.

Apollo Tyres said that the company has many other compelling growth opportunities around the world which it will continue to pursue. The company said its business is performing well, as evidenced by the strong top line and bottom line results for Q2 September 2013 and that the management remains focused on executing the company's standalone strategic plan to maximum value for Apollo's shareholders.

Prestige Estates Projects rose 2.94% after the company said its real estate sales rose 24.69% to Rs 940.20 crore in Q3 December 2013 over Q3 December 2012. The announcement was made during trading hours today, 8 January 2014

Prestige Estates Projects said it sold 1,204 residential units and 0.026 million square feet (Mnsft) of commercial space, aggregating to 2.075 Mnsft, amounting to Rs 1262 crore of sales in Q3 December 2013.

Prestige Estates Projects said it is very close to meet its target set for the fiscal year ending March 2014 in terms of sales, collection and launches.

Education stocks rose on renewed buying. Tree House Education & Accessories (up 0.06%), Everonn Education (up 19.74%), Educomp Solutions (up 4.91%), CORE Education & Technologies (up 4.84%), Zee Learn (up 0.34%) and Aptech (up 4.05%) gained.

Aban Offshore rose 1.91% to Rs 432.15 after the company said it received a contract worth approximately Rs 380 crore to deploy jack-up rig offshore Vietnam for a firm period of 1 year. The stock hit 52-week high of Rs 448.10 in intraday trade. The announcement was made during trading hours today, 8 January 2014. Aban Offshore said it received a letter of award for the deployment of the jack-up rig Deep Driller 5 (owned by the company's step down subsidiary) offshore Vietnam, for a firm period of 1 year and an optional period of 1 year.

The estimated revenues from the deployment during the firm period is about $61.3 million (equivalent to approximately Rs 380 crore). The contract is likely to commence during April 2014, the company said in a statement.

Titagarh Wagons jumped 6.03% after the company said it divested its entire holding in Barrackpore Enterprises on 31 December 2013. The company made the announcement during trading hours today, 8 January 2014.

Titagarh Wagons said it divested its entire holding in Barrackpore Enterprises (BEPL) (formerly Titagarh FreightCar) on 31 December 2013. Accordingly, BEPL is no longer a wholly-owned subsidiary of the company, Titagarh Wagons said in a statement.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 62.0675, compared with its close of 62.30/31 on Tuesday, 7 January 2014.

The next major trigger for the stock market is Q3 December 2013 corporate earnings. 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 Q3 earnings season begins later this week when IT major Infosys and private sector bank IndusInd Bank unveil their earnings on Friday, 10 January 2014.

Prime Minister Dr. Manmohan Singh today, 8 January 2014, said India's economic growth in the current fiscal year will likely remain flat at 5%. A number of international as well as domestic factors have contributed to slow down in India's economic growth in the recent past, Dr. Singh said. He said that India's economic fundamentals remain strong. "Our savings and investment rates are still over 30% of our GDP and the entrepreneurial spirit in India is very much alive and kicking," Dr. Singh said at the Pravasi Bharatiya Diwas, 2014, in New Delhi.

The Reserve Bank of India's Third Quarter Review of Monetary Policy for 2013-14 is scheduled on 28 January 2014.

European stocks edged lower in choppy trade Wednesday, 8 January 2014, before a report on hiring by US companies that may help investors assess the pace of Federal Reserve stimulus. Key benchmark indices in UK, France and Germany were off 0.2% to 0.42%.

The European Central Bank holds a monetary policy meeting tomorrow, 9 January 2014. UK's central bank -- Bank of England -- also undertakes monthly monetary policy review tomorrow, 9 January 2014.

Asian stocks edged higher on Wednesday, 8 January 2014, as the International Monetary Fund said it will raise its global economic growth forecast and as the US trade deficit narrowed. Key benchmark indices in Indonesia, Taiwan, Hong Kong, Singapore and Japan rose by 0.51% to 1.94%. Key benchmark indices in China and South Korea fell by 0.02% to 0.15%.

China is due to publish December trade data today, 8 January 2014. China will release December inflation figures tomorrow, 9 January 2014.

Trading in US index futures indicated that the Dow could drop 11 points at the opening bell on Wednesday, 8 January 2014. US stocks rallied on Tuesday, 7 January 2014, helped by data showing a smaller-than-expected trade gap and gains by health-care stocks following an upgrade for UnitedHealth Group Inc. The US trade deficit fell almost 13% to $34.3 billion in November from a revised $39.4 billion in the prior month, the Commerce Department said Tuesday.

Boston Fed President Eric Rosengren on Tuesday said the central bank should only wind down its bond-buying program gradually. San Francisco Fed President John Williams said the Fed likely will end its bond buys this year, adding that he sees "newfound momentum" in the economy.

The US Federal Reserve will release minutes of its December Federal Open Market Committee policy meeting later in the global day today, 8 January 2014.

The Federal Open Market Committee (FOMC) holds a two-day monetary policy meeting on 28 and 29 January 2014. The 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 this year.

The ADP Research Institute reports the change in US company payrolls later in the global day today, 8 January 2014.

The US government will unveil the influential non-farm payroll report for December 2013 on Friday, 10 January 2014.

The IMF expects to upgrade its outlook for global economic growth, IMF Managing Director Christine Lagarde told reporters in Kenyan capital of Nairobi on Tuesday, 7 January 2014. The organization plans to announce its new forecast in about three weeks, she said. The IMF currently estimates the global economy will expand by 3.6% this year.

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