Key benchmark indices extended intraday gains and hit fresh intraday high in mid-afternoon trade. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit their highest level in almost a week. The Sensex was up 185.13 points or 0.83%, up about 150 points from the day's low. The market breadth, indicating the overall health of the market, was strong. The BSE Mid-Cap index was up by almost 1.5%. The BSE Small-Cap index was up nearly 2%. Both these indices outperformed the Sensex. The market sentiment was boosted by data showing that foreign institutional investors (FIIs) remained net buyers of Indian stocks on Monday, 7 April 2014. Gains in Asian and European stocks also boosted sentiment on the domestic bourses.
Capital goods stocks edged higher.
The market edged higher in early trade on firm Asian stocks. Key benchmark indices extended initial gains and hit fresh intraday high in morning trade. The Sensex trimmed gains in mid-morning trade. The Sensex further pared gains in early afternoon trade. Key benchmark indices extended intraday gains in afternoon trade as European stocks edged higher in early trade there. Key benchmark indices extended intraday gains and hit fresh intraday high in mid-afternoon trade. The Sensex and the 50-unit CNX Nifty, both, hit their highest level in almost a week.
The market sentiment was boosted by data showing that foreign funds remained net buyers of Indian stocks on Monday, 7 April 2014. Foreign institutional investors (FIIs) bought shares worth a net Rs 703.71 crore on Monday, 7 April 2014, as per provisional data from the stock exchanges. The stock markets was closed on Tuesday, 8 April 2014, on account of Ram Navami.
At 14:20 IST, the S&P BSE Sensex was up 185.13 points or 0.83% to 22,528.58. The index jumped 187 points at the day's high of 22,530.45 in mid-afternoon trade, its highest level since 3 April 2014. The index rose 36.50 points at the day's low of 22,379.95 in early afternoon trade.
The CNX Nifty was up 43.60 points or 0.65% to 6,738.65. The index hit a high of 6,746.90 in intraday trade, its highest level since 3 April 2014. The index hit a low of 6,705.10 in intraday trade.
The BSE Mid-Cap index was up 102.41 points or 1.43% at 7,267.7 7. The BSE Small-Cap index was up 138.45 points or 1.9% at 7,419.52. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1,733 shares rose and 901 shares fell. A total of 116 shares were unchanged.
Among the 30 Sensex shares, 23 rose and the rest declined. Sun Pharmaceuticals Industries (up 6.5%), Hindalco Industries (up 4.08%) and Tata Motors (up 3.81%), edged higher from the Sensex pack.
Capital goods stocks edged higher. ABB India (up 1.16%), Bharat Heavy Electricals (Bhel) (up 0.53%), BEML (up 6.65%), L&T (up 0.21%), Siemens (up 1.1%) and Punj Lloyd (up 3.85%) edged higher.
DS Kulkarni Developers rose 0.75% after the company said its board has approved to offer, issue and allot non-convertible debt instruments upto a maximum sum of Rs 250 crore. The announcement was made before market today, 9 April 2014. DS Kulkarni Developers said that its board of directors at its meeting held on Tuesday, 8 April 2014, inter alia, approved to offer, issue and allot non-convertible debt instruments in the form of secured, redeemable, non-convertible debentures to the public (Debentures), upto a maximum sum of Rs 250 crore (including any right to retain oversubscription for issuance of additional Debentures) after complying with the relevant requirements and procedures.
ALSTOM India rose 1.02% after the company said it has received a letter from Alstom Finance B.V to consider the proposal for disposal of the company's auxiliary components business. The announcement was made on Tuesday, 8 April 2014. The stock market was closed on that day, on account of Ram Navami.
ALSTOM India (AIL) said it has received a letter from Alstom Finance B.V. dated 4 April 2014 requesting the board of directors to consider the proposal for disposal by the company of its auxiliary components business to an Indian legal entity to be specified by Triton, as a going concern on a slump-sale basis, subject to receipt of all relevant corporate consents and in accordance with applicable laws.
This activity is part of the non-core asset disposal programme, announced by Alstom, France in November 2013. The auxiliary components business proposed to be sold is part of the steam segment within thermal power and is active both in the new equipment market and aftermarket services across three product lines: air preheaters and gas-gas heaters for thermal power plants, heat transfer solutions for a variety of petrochemical and industrial processes, and grinding mills for diversified industrial applications, AIL said.
Alstom Finance B.V. has requested the company to consider the proposal favourably and commence the requisite process under Indian law including determination of the fair valuation of the auxiliary components business/undertaking and obtaining relevant consents to implement the aforesaid proposal, AIL said.
OnMobile Global surged 7.48% after the company executed a non-binding memorandum of understanding for the potential divestment of its group company, Voxmobili SA. The announcement was made during market hours today, 9 April 2014. OnMobile Global executed a non-binding Memorandum of Understanding (MoU) for the potential divestment of its group company, Voxmobili SA, which specializes in mobile telecommunication products. The proposed deal will be subject to and contingent upon certain events, including applicable regulatory and shareholders' approvals. If the proposed deal were to consummate, OnMobile could realize an amount ranging between $23 million to $26 million for the divestment of the said company (which is around its book value), subject to escrows and other conditions customarily contracted as a part of such a deal, the company said.
Prime Focus rose 5.19% after the company said its technology subsidiary has raised Rs 45 crore through a private placement of optionally convertible debentures. The announcement was made during trading hours today, 9 April 2014.
Prime Focus said that its technology subsidiary Prime Focus Technologies (PFT) has raised Rs 45 crore through a private placement of optionally convertible debentures from a diverse base of high net-worth individuals. The funds raised would be used to fuel expansion of its Cloud Technology, CLEAR in the global markets as well as for retiring debt. After 2 years, investors will also have an option of converting up to 25% of the total principal amount into equity of PFT, the company said. As part of the process, the current base equity valuation of PFT as determined by a Big Four accounting firm has been established at approximately Rs.1100 crore, Prime Focus said in a statement.
Ramki Sankaranarayanan, Founder and CEO, PFT, said, "We are extremely pleased with the investor interest in PFT. Through this attractively structured instrument, we have secured growth capital while broad-basing our investor base and at the same time creating a compelling opportunity for shareholder value creation at PFT as well as the ultimate shareholders at PFL level".
PFT which has grown at over 150% YoY since inception six years ago, aims to replicate its initial success with broadcasters, in the North American studio production segment, Prime Focus said in a statement. In line with this strategy, PFT recently acquired US-based DAX, a leading provider of cloud-based production workflow and media asset management applications to the entertainment industry in North America.
Prime Focus Technologies is the technology subsidiary of Prime Focus, the global leader in media and entertainment industry services.
In the foreign exchange market, the rupee edged higher against the dollar, tracking gains in most other Asian units versus the greenback. The partially convertible rupee was hovering at 60.07, compared with its close of 60.11/12 on Monday, 7 April 2014. India's financial markets were closed on Tuesday, 8 April 2014, on account of Ram Navami.
The Securities and Exchange Board of India (Sebi) on Monday, 7 April 2014, partially reversed curbs on dollar-rupee forward contracts that were imposed last year after the rupee hit record low against the dollar. Sebi had doubled the margin requirement on the domestic dollar-rupee forward trades last year in a bid to arrest the steep decline of the rupee. The stock market regulator on Monday, 7 April 2014, asked stock exchanges and clearing corporations to restore the initial margins and extreme loss margin for dollar-rupee trades to pre 8 July 2013 levels from 15 April 2014.
The Reserve Bank of India (RBI) on Monday, 7 April 2014, said that with a view to further liberalising the existing facilities the RBI has decided to allow all resident individuals, firms and companies, who have actual or anticipated foreign exchange exposures to book foreign exchange forward contracts up to $250,000 on the basis of a simple declaration without any requirement of further documentation, the RBI said in a circular issued to Authorised Dealer Category-I (AD Category-I) banks. This is higher than the existing limit of $100,000. The existing facilities in terms of this circular for Small and Medium Enterprises (SMEs) having direct and/or indirect exposures to foreign exchange risk permitting them to book/cancel/roll over forward contracts without production of underlying documents to manage their exposures effectively subject to conditions specified therein shall remain unchanged, the RBI said.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014, as consumer-price inflation eased to a two-year low and as the rupee firmed up against the dollar.
The next major trigger for the stock market is Q4 March 2014 and year ended 31 March 2014 (FY 2014) corporate earnings. Investors and analysts will closely watch the management commentary that would accompany the results to see if there is any revision in their future earnings forecast of the company for the year ending 31 March 2015 (FY 2015) and/or for the year ending 31 March 2016 (FY 2016). Indian companies will start reporting their Q4 and full year results from mid-April 2014. The result season will conclude in end-May 2014.
A major near term trigger for the stock market is the outcome of the upcoming Lok Sabha elections. The 36 days long voting process began on 7 April 2014 and will conclude on 12 May 2014. The results will be declared on 16 May 2014 after which India will get a new government. The term of the current Lok Sabha expires on June 1 and the new House has to be constituted by May 31.
Polling began for the lone parliamentary seat in Nagaland in the second phase of Lok Sabha elections today, 9 April 2014. The poll will decide the fate of Chief Minister Neiphiu Rio, who is the candidate from his Naga Peoples Front party.
European stocks edged higher on Wednesday, 9 April 2014, as US stocks on Tuesday, 8 April 2014, snapped three straight sessions of losses. Key benchmark indices in UK, France and Germany were up 0.29% to 0.6%.
Sweden's central bank kept its main interest rate unchanged after a monetary policy review today, 9 April 2014, in a bet that an economic recovery will put an end to the threat of deflation. The repurchase rate was held at 0.75% for a second meeting, the Riksbank said in a statement. "Economic activity is clearly strengthening, but inflation is expected to remain low for some time. Monetary policy needs to remain expansionary for inflation to rise towards the target," the Riksbank said.
Meanwhile, Sweden's government today, 9 April 2014, raised its outlook for GDP growth to 2.7% this year, after a 1.5% expansion in 2013.
A monthly meeting of the Monetary Policy Committee of the Bank of England's (BoE) for monetary policy review is scheduled tomorrow, 10 April 2014.
Asian stocks outside Japan rose on Wednesday, 9 April 2014, as consumer companies advanced. Key benchmark indices in Hong Kong, Singapore, China, Taiwan and South Korea were up 0.01% to 1.09%. Japanese equities fell after the yen rose against the dollar. The Nikkei 225 Average lost 2.1%.
The Bank of Japan (BOJ) refrained from adding to unprecedented monetary stimulus after a monetary policy review on Tuesday, 8 April 2014, as Governor Haruhiko Kuroda said the blow to the economy from last week's sales-tax increase will fade during the summer. The central bank will continue to expand the monetary base at a pace of 60 trillion yen to 70 trillion yen ($682 billion) per year, it said in a statement in Tokyo. At a press briefing, Kuroda said the BOJ would always adjust policy without hesitation as needed, including easing or tightening. The economy has continued to recover moderately, "albeit with some fluctuations due to the consumption tax hike," the BOJ said in its statement. Kuroda said he will adjust record easing that the BOJ began in April last year should prospects for achieving the price target be jeopardized.
Indonesia's central bank kept its key interest rate unchanged after a monetary policy review on Tuesday, 8 April 2014, extending a pause in monetary tightening as inflation slowed. Bank Indonesia Governor Agus Martowardojo and his board maintained the reference rate at 7.5%, the central bank said in Jakarta. It also kept the deposit facility rate unchanged at 5.75%.
Trading in US index futures indicated that the Dow could advance 25 points at the opening bell on Wednesday, 9 April 2014. US stocks snapped three-day losing streak on Tuesday, 8 April 2014, on bargain-hunting as investors picked up stocks that had fallen the most in the slump over the previous three days.
The US Federal Reserve releases minutes of its March 18-19 gathering today, 9 April 2014. The Federal Reserve on 19 March 2014 said after the conclusion of a monetary policy review that it will trim its monthly bond purchases by $10 billion to $55 billion. The Federal Reserve will end its bond-buying program before the end of the year with an interest-rate increase likely to follow in "around six months," Chair Janet Yellen said on 19 March 2014. Quarterly Fed forecasts on 19 March 2014 showed more officials predicting that the benchmark interest rate, now close to zero, will rise to at least 1% by the end of 2015 and 2.25% a year later.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 29-30 April 2014.
Stronger US growth this year and next will help the world economy withstand weaker recoveries in emerging markets including Brazil and Russia, the International Monetary Fund (IMF) said in a report yesterday, 8 April 2014. The IMF predicted global growth of 3.6% this year, compared with a January estimate of 3.7%. Next year, the expansion will accelerate to 3.9%, unchanged from the prior forecast. Developing Asian economies are forecast to grow 6.7% this year, the IMF said.
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