Amid divergent trend in various index constituents, key benchmark indices eked out small gains. While banking stocks, PSU OMCs, and pharma stocks rose, metal & mining and cement stocks dropped. The barometer index, the S&P BSE Sensex, failed to retain the psychological 28,000 level which it had pierced for the first time in its history earlier during the trading session. The Sensex was provisionally up 40.96 points or 0.15% at 27,901.34. The market breadth indicating the overall health of the market was positive.
Brent crude declined to its lowest in four years amid speculation OPEC will refrain from paring a global surplus. Fall in crude oil prices augur well for India as the country imports 80% of its oil requirement. Meanwhile, a survey released today, 5 November 2014, showed that business activity at India's service sector stagnated last month.
Foreign portfolio investors bought shares worth a net Rs 1413.34 crore during the previous trading session on Monday, 3 November 2014, as per provisional data released by the stock exchanges. The stock market was closed yesterday, 4 November 2014, on account of Moharram.
Dr Reddy's Laboratories rose after a foreign brokerage upgraded the stock to "overweight" from "equal-weight". Among private sector banking stocks Axis Bank, ICICI Bank, IndusInd Bank, Kotak Mahindra Bank and HDFC Bank scaled record high. PSU Bank stocks were mostly higher.
Meanwhile, as per media reports, security forces in Kolkata are on high alert following a central intelligence warning that the city's port may be the target of an attack by militants posing as fishermen.
Amid intraday volatility, the Sensex and the 50-unit CNX Nifty, both, hit record high today, 5 November 2014.
In overseas markets, US index futures were in green after the results showed that the Republican Party recaptured control of the US Senate in Tuesday's midterm elections, notching victories in races around the country. European stocks rose as better-than-estimated earnings offset investor concern about the health of the region's economy. Asian stocks declined after weak economic data from China.
In the foreign exchange market, the rupee edged lower against the dollar on broad gains for the dollar after victory for the Republican Party in US mid-term elections.
Brent crude declined to its lowest in four years amid speculation OPEC will refrain from paring a global surplus.
As per provisional closing, the S&P BSE Sensex was up 40.96 points or 0.15% at 27,901.34. The index jumped 150.01 points at the day's high of 28,010.39 in late trade, a lifetime high for the index. The index fell 2.73 points at the day's low of 27,857.65 in afternoon trade.
The 50-unit CNX Nifty was up 14.15 points or 0.17% at 8,338.30. The index hit a high of 8,365.55 in intraday trade, a lifetime high for the index. The index hit a low of 8,323.50 in intraday trade.
The market breadth indicating the overall health of the market was positive. On BSE, 1,638 shares gained and 1,378 shares fell. A total of 109 shares were unchanged.
The BSE Mid-Cap index was up 23.21 points or 0.23% at 9,964.61. The BSE Small-Cap index was up 83.86 points or 0.76% at 11,160.98. Both these indices outperformed the Sensex.
The total turnover on BSE amounted to Rs 4392 crore, higher than Rs 3506.62 crore on Monday, 3 November 2014. The stock market was shut yesterday, 4 November 2014, on account of Moharram.
Dr Reddy's Laboratories rose 2.24% to Rs 3,252 after a foreign brokerage reportedly upgraded the stock to "overweight" from "equal-weight". According to the foreign brokerage, the drugmaker's US pipeline outlook has strengthened and the stock's valuations appears to be reasonable.
Bank stocks were in demand. Among private sector bank stocks, ICICI Bank rose 2.27% to Rs 1,679.40 after scaling a record high of Rs 1,679.70 in intraday trade.
IndusInd Bank advanced 2.11% to Rs 723 after scaling a record high of Rs 726 in intraday trade.
Kotak Mahindra Bank rose 1.22% to Rs 1,125 after scaling a record high of Rs 1,138.75 in intraday trade.
HDFC Bank rose 0.16% to Rs 911.90 after scaling a record high of Rs 920 in intraday trade.
Axis Bank rose 3.49% to Rs 460.15 after scaling a record high of Rs 460.25 in intraday trade.
Yes Bank fell 1.28%. Federal Bank rose 1.73%.
Most PSU bank stocks rose. State Bank of India (SBI) (up 2.18%), Canara Bank (up 0.12%), Bank of Baroda (up 0.12%), Bank of India (up 0.33%) gained. Union Bank of India (down 2.06%), Indian Overseas Bank (down 3.49%) and Andhra Bank (down 2.79%) declined.
Punjab National Bank shed 0.31%. The bank during market hours today, 5 November 2014, said it has decided to realign the interest rates in case of single domestic and NRE term deposits with effect from 4 November 2014. The interest rate on domestic term deposits of below Rs 1 crore with a maturity period above 3 year to 10 years has been cut to 8.75% from 9%. Interest rate on domestic term deposit of Rs 1 crore to Rs 10 crore with maturity of 1 year and upto 3 years has been cut to 8.75% from earlier 9%. The interest rate on domestic term deposit of Rs 1 crore to Rs 10 crore with maturity above 3 years to 5 years has been cut to 8.5% from earlier 8.75%.
GAIL (India) shed 0.23%. The company today, 5 November 2014, clarified that allegations made by a section of people on cut in APM gas supplies are not true and there has not been any arbitrary or selective reduction in allocations to small industrial customers in South Gujarat. In fact, special emphasis is being given to protect the interest of small customers (those presently having allocation of domestic gas up to 50,000 SCMD). Under these guidelines, present level of supply upto a maximum of 5,000 SCMD is reserved for small customers and kept out from the purview of the pro-rata cut, GAIL (India) said. This allays any concerns of the small customers, including glass units in South Gujarat, the company said.
GlaxoSmithkline Consumer Healthcare fell 1.93%. The company's net profit rose 9.09% to Rs 160.29 crore on 11.15% growth in total income to Rs 1175.46 crore in Q2 September 2014 over Q2 September 2013. The result was announced during market hours today, 5 November 2014.
The stock market remains closed tomorrow, 6 November 2014, on account of Gurunanak Jayanti.
In the foreign exchange market, the rupee edged lower against the dollar on broad gains for the dollar after victory for the Republican Party in US mid-term elections. The partially convertible rupee was hovering at 61.4275, compared with its close of 61.405 on Monday, 3 November 2014. The currency market was shut yesterday, 4 November 2014, on account of Moharram.
Brent crude declined to its lowest in four years amid speculation OPEC will refrain from paring a global surplus. Brent crude for December delivery was off 78 cents at $82.04 a barrel. The contract slid as much as $1.19 to $81.63 a barrel, the lowest since 21 October 2010.
Indian government's decision last month to decontrol diesel prices and a sharp decline in global crude oil prices recently will help India in containing its fiscal deficit. The fall in global crude oil prices will also help India in containing its current account deficit and fuel price inflation. India imports 80% of its crude oil requirement. A slump in Brent crude since the end of June contributed to consumer-price index slowing to 6.46% in September 2014, the least since 2012. However, a weakness in rupee against the dollar will restrict the benefit of falling global crude oil prices to that extent.
The government is open to privatisation of certain loss-making public sector companies, Finance Minister Arun Jaitley reportedly said today, 5 November 2014, during an interaction at the World Economic Forum in New Delhi. Jaitley also reportedly said the government will soon unveil reforms for other natural resources sectors along the lines of coal block auctions.
Jaitley also reportedly said that the government intends to open railways further to private investment, review tough land purchase rules and relax labour laws, but added that the government needed to build support for some of these measures. Jaitley said he hoped a long-delayed bill to allow up to 49% foreign investment in the insurance sector would be passed by parliament within weeks.
Meanwhile, a survey released today, 5 November 2014, showed that business activity at India's service sector stagnated last month. Adjusted for seasonal factors, the headline HSBC India Services PMI Business Activity Index -- a single question tracking changes in activity at Indian services companies on a month-by-month basis -- fell to 50 in October, from 51.6 in September. Despite rising for the sixth consecutive month, new work intakes in the Indian service sector increased at the weakest pace since May during October. Growth of employment in the Indian service sector also slowed in October. The services sector contributes about 60% to India's gross domestic product.
On the positive side, the latest data indicated that service sector firms in India remained highly optimistic regarding prospects for activity growth in the coming year. Business sentiment was the strongest in three months, with panellists commenting on anticipated improvements in demand and new marketing initiatives as key sources of optimism.
European stocks edged higher today, 5 November 2014, as better-than-estimated earnings offset investor concern about the health of the region's economy. Key benchmark indices in UK, France and Germany were up 0.6% to 0.93%.
The European Commission yesterday, 4 November 2014, cut its forecast for growth domestic product for the 18-country eurozone region to 0.8% this year, from a previous forecast of 1.2%, in the spring. In 2015, the eurozone economy will likely grow 1.1%, also less than the 1.7% growth seen in the spring. In 2016, growth in the currency union will rise to 1.7%, the commission said.
Investors are awaiting policy decisions by the European Central Bank (ECB) after a monetary policy review tomorrow, 6 November 2014. Investors will weigh ECB President Mario Draghi's speech for hints of further stimulus, including the purchase of government bonds. The ECB began buying covered bonds last month as part of a strategy to revive prices, boost lending and spur growth.
The Bank of England (BoE) also undertakes a monthly monetary policy review tomorrow, 6 November 2014.
Asian stocks declined today, 5 November 2014, after weak economic data from China. Key benchmark indices in China, Indonesia, Taiwan, South Korea and Hong Kong were off 0.08% to 0.63%. Key benchmark indices in Japan and Singapore were up 0.18% to 0.44%.
The HSBC China services purchasing managers index edged down to 52.9 in October from 53.5 in September, but most major components of the index remain solid, HSBC Holdings PLC said today, 5 November 2014. A reading above 50 indicates month-on-month expansion while a level below that points to contraction.
Trading in US index futures indicated that the Dow could rise 50 points at the opening bell today, 5 November 2014. The latest results showed that the Republican Party recaptured control of the US Senate in Tuesday's midterm elections, notching victories in races around the country. Republicans also kept control of the House of Representatives on Tuesday, as was widely expected. By taking the Senate and keeping the House, the Republican Party takes control of Congress for the first time in eight years. Republicans are expected to be tougher on the Federal Reserve and so-called loose monetary policies.
The US stock market finished Tuesday's choppy session mostly lower, as steep losses in energy companies' stocks weighed on the main benchmark. In economic news, US trade deficit jumped in September to the highest level since the late spring. The surprising spike in the trade deficit is likely to reduce third-quarter growth when the US government revises the report later this month.
St. Louis Fed President James Bullard yesterday, 4 November 2014, said that the US economy is on track to grow at a 3% annual rate over the next 14 months, which should allow the Federal Reserve to move ahead with plans to hike short-term interest rates.
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