Key benchmark indices extended gains and hit fresh intraday high in mid-afternoon trade after a news agency quoted an unnamed official of the India Meteorological Department as saying that conditions have turned favourable for the onset of monsoon in India in about 24 hours. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit highest level in more than a week. The Sensex was up 173.67 points or 0.7%, up close to 335 points from the day's low and off about 10 points from the day's high. The market breadth indicating the overall health of the market was strong, with more than two gainers for every loser on BSE. The BSE Small-Cap index was up more than 1.6%. The BSE Mid-Cap index was up 1.2%. Both these indices outperformed the Sensex.
Capital goods stocks extended recent gains, with L&T hitting record high. Realty stocks edged higher. Shares of fast moving electricals goods maker Havells India surged. Mercator rose after the company said that its step down overseas subsidiary engaged in carrying on the business of oil & gas and allied services has entered into an agreement to avail a facility of $55 million. Piramal Enterprises rose after the company said it has acquired 9.99% equity stake in Shriram City Union Finance. IL&FS Transportation Networks rose after the firm said it has increased its equity stake from 14.5% to 49% in the capital of Srinagar Sonmarg Tunnel way.
A bout of volatility was witnessed in initial trade as key benchmark indices regained positive terrain after slipping into the red after opening higher. Key benchmark indices edged lower and hit fresh intraday low in morning trade. The Sensex trimmed intraday losses in mid-morning trade. The Sensex regained positive terrain in early afternoon trade. Key benchmark indices extended gains and hit fresh intraday high in early afternoon trade after a news agency quoted an unnamed official of the India Meteorological Department as saying that conditions have turned favourable for the onset of monsoon in India in about 24 hours. Key benchmark indices extended gains and hit fresh intraday high in mid-afternoon trade. The Sensex and the 50-unit CNX Nifty, both, hit their highest level in more than a week.
Foreign institutional investors (FIIs) bought shares worth a net Rs 192.56 crore on Wednesday, 4 June 2014, as per provisional data from the stock exchanges.
At 14:20 IST, the S&P BSE Sensex was up 173.67 points or 0.7% at 24,979.50. The index jumped 182.51 points at the day's high of 24,988.34 in mid-afternoon trade, its highest level since 26 May 2014. The index fell 160.95 points at the day's low of 24,644.88 in morning trade, its lowest level since 3 June 2014.
The CNX Nifty was up 58.40 points or 0.79% to 7,460.65. The index hit a high of 7,464.80 in intraday trade, its highest level since 26 May 2014. The index hit a low of 7,360.50 in intraday trade, its lowest level since 3 June 2014.
The BSE Mid-Cap index was up 106.82 points or 1.2% at 8,972.76. The BSE Small-Cap index was up 154.93 points or 1.63% to 9,643.64. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market was strong, with more than two gainers for every loser on BSE. On BSE, 2,106 shares rose and 823 shares fell. A total of 93 shares were unchanged.
Realty stocks edged higher. DLF (up 0.48%), Sobha Developers (up 0.27%), Housing Development and Infrastructure (HDIL) (up 3.38%), and Unitech (up 0.99%), edged higher.
Capital goods stocks extended recent gains. Bharat Heavy Electricals (Bhel) (up 0.62%), BEML (up 1.2%), ABB (India) (up 3.8%), and Siemens (up 3.57%) gained.
L&T rose 0.74% to Rs 1686.55, with the stock extending recent gains triggered by the company's strong Q4 result. The stock hit record high of Rs 1,693.55 in intraday trade so far. The company's net profit surged 69% to Rs 2723.48 crore on 11% growth in gross revenue to Rs 20229 crore in Q4 March 2014 over Q4 March 2013. The strong growth in bottom-line can be explained by strong operating performance and higher extraordinary income. The result was announced after market hours on Friday, 30 May 2014.
L&T's order intake during the quarter was steady at Rs 26737 crore. International order inflow during the quarter at Rs 11389 crore constituted 43% of the total order inflow for the quarter. The order book at Rs 162952 crore as at 31 March 2014, grew 13% on YoY basis. International order book constituted 21% of the total order book, L&T said in a statement.
With regard to future business outlook, L&T said it has weathered the challenging times of the past few years due to its inherent capabilities and strong balance sheet. Being well positioned to tap the emerging opportunities in its core businesses, the company looks forward to a period of renewed investment momentum and sustainable growth. Given its large order book, the company is optimistic to maintain its growth momentum in the medium term, as domestic and global economic environment improves, L&T said in a statement.
Shares of fast moving electricals goods maker Havells India surged. The stock was up 8.8% at Rs 1,156.50. The stock hit record high of Rs 1,183.55 in intraday trade.
Piramal Enterprises rose 0.74% after the company said it has acquired 9.99% equity stake in Shriram City Union Finance. The announcement was made during market hours today, 5 June 2014. Piramal Enterprises said that it has acquired 65.79 lakh equity shares of Shriram City Union Finance, the retail focused non-banking financial company (NBFC) of the Shriram Group. The acquisition, by way of a preferential allotment of shares by Shriram City Union, was at a price of Rs 1,200 per equity share. The total consideration paid was Rs 790 crore, Piramal Enterprises said in a statement.
In April this year, Piramal had acquired an effective 20% equity stake in Shriram Capital, the overarching holding company for the financial services and insurance entities of the Shriram Group, for a consideration of Rs 2014 crore. Piramal had also invested Rs 1636 crore in May 2013 to acquire approximately 9.9% equity in Shriram Transport Finance Company, one of the listed NBFCs forming part of the Shriram Group.
Mercator rose 2.62% after the company said that its step down overseas subsidiary engaged in carrying on the business of oil & gas and allied services has entered into an agreement to avail a facility of $55 million. The announcement was made after market hours on Wednesday, 4 June 2014. Mercator said that Mercator Energy Pte (MEPL), a step-down overseas subsidiary of the company, engaged in carrying on the business of oil & gas and allied services of the company, has entered into an agreement on 4 June 2014, to avail a facility of $55 million. The said facility will be compulsorily converted into equity shares of MEPL in the event of listing of its shares at a pre-determined discount to the listing price, Mercator said. In the event of non-listing of its shares, the facility will be repaid at a pre-determined yield to maturity at the end of 6 years from the first drawdown. This transaction will help MEPL to expand in the oil and gas space, Mercator said.
IL&FS Transportation Networks rose 1.95% after the firm said it has increased its equity stake from 14.5% to 49% in the capital of Srinagar Sonmarg Tunnel way. The announcement was made during market hours today, 5 June 2014. IL&FS Transportation Networks (ITNL) said that the company has increased its equity stake from 14.5% to 49% in the capital of Srinagar Sonmarg Tunnel way, a company promoted by SOMA Enterprise (SOMA), and the company to undertake the construction, operation and maintenance of Z-Morh Tunnel including approaches on National Highway No. 1 (Srinagar-Sonmarg-Gumri Road) in Jammu & Kashmir on design, build, finance, operate and transfer (DBFOT) Annuity Basis (hereinafter referred to as the Project) awarded by the Border Road Organization, Government of India (the Authority), ITNL said.
In the foreign exchange market, the rupee edged higher against the dollar as equities rose. The partially convertible rupee was hovering at 59.2975, compared with its close of 59.33/34 on Wednesday, 4 June 2014.
Finance Minister Arun Jaitley said in his opening remarks while holding his first Pre-Budget Consultation with the representatives of the agriculture sector today, 5 June 2014, that despite the constraints of the economy as it exist today, the government will try its best to boost the agriculture sector. He said that the concerns of agriculture sector are high on the priority of the government. Even as agriculture and its allied sector employ the largest numbers of people in the country, yet its share in the GDP has contracted over the years, Jaitley said.
The Ministry of Finance said that various suggestions were received from the different representatives of the agriculture sector. Major suggestions include establishing a Kissan TV Channel to create awareness among farmers about new technologies, government programmes and quality parameters etc among others.
Jaitley is expected to table Union Budget for 2014-15 in Lok Sabha by mid-July 2014. An interim budget was presented by P. Chidambaram in February this year. Essentially, in the nature of a vote on account, the interim budget was intended to get Parliament approval for expenditure to be incurred during the first few months of fiscal year 2014-15 due to Lok Sabha elections.
The Reserve Bank of India (RBI)'s third bi-monthly monetary policy statement is scheduled on 5 August 2014. The RBI kept its main lending rate -- repo rate -- unchanged at 8% after a monetary policy review on 3 June 2014. The central bank at that time signaled it would ease monetary policy if inflation slows faster than targeted.
European stocks edged lower on Thursday, 5 June 2014, as investors were hesitant of making any major moves ahead of the European Central Bank meeting later in the day. Key benchmark indices in Germany and UK were off 0.02% to 0.22%. France's CAC 40 rose 0.07%.
German factory orders rebounded in April from the biggest plunge in more than a year, signaling that growth in Europe's largest economy remains on track. Orders, adjusted for seasonal swings and inflation, increased 3.1% from March, when they declined 2.8%, the Federal Statistics Office in Wiesbaden said today.
There are expectations that ECB will announce new stimulus measures when the Governing Council of the ECB holds a monthly meeting on euro area interest rates today, 5 June 2014.
Bank of England's Monetary Policy Committee will probably keep its benchmark interest rate at a record-low 0.5% and leave its bond-purchase program unchanged at a monthly meeting on interest rates in UK today, 5 June 2014.
Asian stocks edged lower on Thursday, 5 June 2014, as investors await a European Central Bank policy decision later in the global day. Key benchmark indices in Indonesia, Singapore, South Korea and Hong Kong were off 0.08% to 0.65%. Key benchmark indices in China, Taiwan and Japan were up 0.08% to 0.79%.
HSBC/Markit's measure of the China service sector eased to 50.7 in May from April's 51.4, though that was still above the 50-point level that is supposed to separate growth from contraction.
Trading in US index futures indicated that the Dow could gain 11 points at the opening bell on Thursday, 5 June 2014. US stocks edged up on Wednesday with the S&P 500 index ending at a new record as investors brushed off weaker-than-expected labor market data and focused on acceleration in services-sector growth.
Service industries in the US expanded at the fastest pace in nine months in May. The Institute for Supply Management said its services sector index rose to 56.3 last month from 55.2 in April as new orders, order backlogs and hiring increased. It was the highest reading in nine months. The Federal Reserve said in its Beige Book review of regional conditions that the world's largest economy expanded at a modest to moderate pace last month. The Beige Book, released two weeks before policy makers meet, supported Fed Chair Janet Yellen's view that the US economy is rebounding from a 1% contraction in the first quarter caused largely by harsh winter weather. The Commerce Department said the trade gap increased 6.9% to $47.2 billion in April as imports hit a record high and exports slipped. It was the largest deficit in two years.
A private report showed employment rose less than economists projected. Private employers added 179,000 jobs to their payrolls last month after hiring 215,000 workers in April, according to payrolls processor ADP.
The influential US nonfarm payroll data for May 2014 is due for release tomorrow, 6 June 2014.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 17-18 June 2014. The Fed on 30 April 2014 said after a monetary policy review that it will keep the benchmark interest-rate target at almost zero for a "considerable time" after its bond-buying program ends. The FOMC also reduced monthly debt purchases to $45 billion, its fourth straight $10 billion cut, and said further reductions are likely in "measured steps" if the economy continues to improve.
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