Fall in global crude oil and industrial metal prices triggered a strong intraday rebound on the domestic bourses at the onset of the week. A bout of volatility was witnessed in late trade as key benchmark indices trimmed gains after extending intraday gains. The Sensex regained the psychological 27,000 level after falling below that mark in early trade. The Sensex and the 50-unit CNX Nifty, both, reached their highest closing level in nearly two weeks. The Sensex rose 116.32 points or 0.43% to settle at 27,206.74. The market breadth indicating the overall health of the market was positive. Falling global crude oil prices augur well for India as the country imports almost 80% of its crude oil requirements. Meanwhile, weakness in global industrial metal prices could reduce cost of production for manufacturing companies. Shares of state-run upstream oil and gas companies rose on hopes subsidy burden of these companies could fall along with fall in global crude oil prices.
Most bank stocks gained. Punjab National Bank gained on fund raising plans. Colgate Palmolive (India) rose after declaring first interim dividend for the year ending 31 March 2015. Jewellery makers gained on hopes of increased demand during upcoming festive season and as fall in gold prices could lure customers for more purchases. Metal and mining stocks declined on lower industrial metals and iron ore prices in global markets today, 22 September 2014. Cement stocks declined.
In overseas markets, European stocks dropped as China's finance minister damped speculation his government will boost economic stimulus for the world's second biggest economy. Asian stocks fell amid speculation China may accept slower growth and after officials from the world's biggest economies warned of rising financial risks. US index futures were in red.
Group of 20 finance chiefs and central bankers said low interest rates could lead to a potential increase in financial-market risk, as major economies rely on monetary stimulus to bolster uneven growth. "We are mindful of the potential for a build-up of excessive risk in financial markets, particularly in an environment of low interest rates and low asset price volatility," the G-20 officials reportedly said yesterday, 21 September 2014 in Cairns, Australia, after a two-day meeting. Earlier, key indices had reversed losses in mid-afternoon trade after moving in a narrow range in negative zone.
Earlier, key indices had reversed losses in mid-afternoon trade after moving in a narrow range in negative zone.
Brent crude oil prices edged lower as sluggish demand and abundant supplies outweighed a possible cut in oil output from the Organization of the Petroleum Exporting Countries (OPEC).
In the foreign exchange market, the rupee was a tad higher against the dollar.
The S&P BSE Sensex rose 116.32 points or 0.43% to settle at 27,206.74, its highest closing level since 9 September 2014. The index jumped 164.38 points at the day's high of 27,254.80 in late trade. The index lost points at the day's low of 26,918.93 in early trade, its lowest level since 18 September 2014.
The CNX Nifty rose 24.85 points or 0.31% to settle at 8,146.30, its highest closing level since 9 September 2014. The index hit a high of 8,159.90 in intraday trade. The index hit a low of 8,064.80 in intraday trade, its lowest level since 18 September 2014.
The total turnover on BSE amounted to Rs 3255 crore, lower than Rs 5172 crore on Friday, 19 September 2014.
The market breadth indicating the overall health of the market was positive. On BSE, 1,682 shares gained and 1,353 shares fell. A total of 96 shares were unchanged.
The BSE Mid-Cap index advanced 19.56 points or 0.2% to settle at 9,884.92, underperforming the Sensex. The BSE Small-Cap index gained 57.51 points or 0.51% to settle at 11,248.69, outperforming the Sensex.
Among the sectoral indices on BSE, the BSE Auto index (up 1.1%), Consumer Durables index (up 3.12%), FMCG index (up 1.9%), and Oil & Gas index (up 0.88%) outperformed the Sensex.
The Bankex index (up 0.29%), Capital Goods index (down 0.2%), Healthcare index (down 0.89%), IT index (down 0.27%), Metal index (down 1.22%), Power index (down 0.6%), Realty index (down 0.8%), and Teck index (down 0.39%) underperformed the Sensex.
Brent crude oil prices edged lower as sluggish demand and abundant supplies outweighed a possible cut in oil output from the Organization of the Petroleum Exporting Countries (OPEC).
In the foreign exchange market, the rupee was almost unchanged against the dollar.
Most PSU OMCs edged higher as crude oil prices dropped. BPCL (up 2.16%), Indian Oil Corporation (IOC) (up 0.74%), and HPCL (up 0.63%) gained. Lower crude oil prices could reduce under-recovery of PSU OMCs on domestic sale of LPG and kerosene at controlled prices. The government has already freed pricing of petrol.
PSU OMCs have over recovery of 35 paise per litre on sale of diesel for the current fortnight, as per data released by the Petroleum Planning & Analysis Cell on 16 September 2014. PSU OMCs are currently incurring daily under-recovery of Rs 190 crore on the sale of Diesel, PDS Kerosene and Domestic LPG.
Shares of state-run upstream oil and gas companies rose on hopes subsidy burden of these companies could fall along with fall in global crude oil prices. ONGC (up 3.48%), GAIL (India) (up 0.99%) and Oil India (up 1.5%) gained.
State run upstream companies share a part of the under recoveries of state-run oil marketing companies (PSU OMCs) by allowing discount in the prices of crude oil, PSD kerosene, and domestic LPG based on the rates of discount communicated by the Ministry of Petroleum and Natural Gas and the Petroleum Planning & Analysis Cell.
Jewellery makers gained on hopes of increased demand during upcoming festive season and as fall in gold prices could lure customers for more purchases. Gitanjali Gems (up 6.55%), Titan Company (up 2.33%) and PC Jeweller (up 19.53%) edged higher.
Tara Jewels surged 9.93% at Rs 108.45 after the company's subsidiary Fabrikant-Tara International has entered into partnership with Zac Posen to create a new collection of handcrafted fine jewelry.
Pidilite Industries lost 0.11% at Rs 393.50. The company after market hours today, 22 September 2014, said that its board of directors approved the acquisition of the adhesive business of Blue Coat on a slump sale basis for a consideration of Rs 263.57 crore.
Reliance Industries lost 0.35% at Rs 991.10. The company after market hours today, 22 September 2014, said that its subsidiary Reliance Jio Infocomm (Reliance Jio) and Indus Towers have signed a master services agreement (MSA) for tower infrastructure sharing. Under the agreement, Reliance Jio would utilize the telecom tower infrastructure services being provided by Indus Towers to launch its services across the country. As per the agreement, the pricing would be based on prevailing market rates.
Indus Towers in an independently managed company offering passive infrastructure services to all telecom operators.
Most bank stocks gained. Federal Bank (up 1.99%), IndusInd Bank (up 1.92%), Yes Bank (up 1.74%), State Bank of India (up 1.3%), ICICI Bank (up 0.44%), Bank of Baroda (up 0.51%), and Axis Bank (up 0.17%) gained. HDFC Bank (down 0.41%), Bank of India (down 0.78%), and Kotak Mahindra Bank (down 1.84%) declined.
Punjab National Bank rose 0.92% at Rs 985.65 after the bank said before market hours that the board of directors of the bank at its meeting held on 19 September 2014 decided to explore the avenues for raising capital through QIP/FPO/rights issue and raise Basel III compliant additional Tier-I capital bonds. The board also considered and granted in-principle approval for a 5-for-1 stock split.
IDFC dropped 2.23% to Rs 144.65 after shares issued by the company to institutional investors recently were admitted for trading on the bourses today, 22 September 2014. A total of 7.3 crore shares were admitted for trading. IDFC had on 16 September 2014 said that it had allotted 7.3 crore shares to Qualified Institutional Buyers (QIBs) at an issue price of Rs 137 per share. The stock had risen 0.37% to settle at Rs 147.95 on Friday, 19 September 2014, on BSE. The company had raised Rs 1000.10 crore from the sale of shares to QIBs.
Colgate Palmolive (India) rose 1.74% at Rs 1,653.50 after the company's board of directors at its meeting held during trading hours today, 22 September 2014, declared first interim dividend of Rs 8 per share for the year ending 31 March 2015.
Metal and mining stocks declined after prices of industrial metals and iron ore declined in global market today, 22 September 2014. Sesa Sterlite (down 0.25%), Hindalco Industries (down 1.37%), JSW Steel (down 2.95%), Tata Steel (down 1.86%), Steel Authority of India (Sail) (down 2.88%), and NMDC (down 0.89%) declined. Jindal Steel & Power (up 1.56%) gained.
Copper for three-month delivery on the London Metal Exchange (LME) fell a fourth day. The metal lost 1.5% to $6,735 a metric ton, headed for its lowest close since 19 June 2014. On the LME, aluminum, zinc, nickel, tin and lead also declined. Meanwhile, Chinese steel and iron ore futures slid 4% to their lowest on record, plagued by worries of excess supply at a time when demand in the world's top consumer of the two commodities is growing at a slower pace.
Hindustan Zinc dropped 2.52% at Rs 162.50 as the stock turned ex-dividend today, 22 September 2014, for interim dividend of Rs 1.90 per share for the year ending 31 March 2015 (FY 2015).
Most auto stocks gained on hopes lower industrial metal prices could boost profit margins. Tata Motors (up 3.93%), Eicher Motors (up 0.92%), Ashok Leyland (up 2.9%) edged higher. Maruti Suzuki India (down 0.29%) and Mahindra & Mahindra (M&M) (down 0.12%) declined.
Shares of two wheeler makers gained. Hero MotoCorp (up 1.65%), Bajaj Auto (up 0.19%) and TVS Motor Company (up 2.29%) rose.
Cement stocks declined. ACC (down 1.36%), Ambuja Cements (down 0.37%), and UltraTech Cement (down 1.23%) declined.
Grasim Industries rose 0.69% at Rs 3,706.75. Grasim has exposure to the cement sector through its subsidiary UltraTech Cement.
Shree Cement declined 0.81% at Rs 8,505.80. Shree Cement and Jaiprakash Associates said after market hours on Friday, 19 September 2014, that Shree Cement has entered into a business transfer agreement (BTA) with Jaiprakash Associates for acquisition of 1.50 million tonnes per annum (MTPA) cement grinding unit of Jaiprakash Associates situated at Panipat in Haryana on going concern basis. The two companies had first made the announcement of the transaction on 24 August 2014.
Shares of Jaiprakash Associates jumped 5.65% at Rs 35.50.
Pharma stocks declined. Cipla (down 2.27%), Dr Reddy's Laboratories (down 0.73%), Ranbaxy Laboratories (down 1.98%), Sun Pharmaceutical Industries (down 1.18%), and Lupin (down 0.92%) declined.
The government has capped the prices of 36 drugs, including those used to treat infections and diabetes to make essential medicines more affordable, an official at the National Pharmaceutical Pricing Authority (NPPA) was quoted as saying on Friday, 19 September 2014. The medicines join the 348 drugs deemed essential and that are therefore subject to price caps, covering up to 30% of the total drugs sold.
Bharti Infratel fell 5.67% at Rs 292.20. The stock fell on buzz that US-based private equity fund Kohlberg Kravis Roberts and Co. (KKR) is set to sell its entire stake in the company via a block deal on the stock exchanges. As on 30 June 2014, KKR Towers Company Mauritius held 4.50 crore equity shares, or 2.38% equity, of Bharti Infratel.
Asian Paints lost 2.32% at Rs 652.80 as the stock ex-dividend today, 22 September 2014, for interim dividend of Rs 1.80 per share for the year ending 31 March 2015.
Crompton Greaves rose 0.9% at Rs 213.55. The company said during market hours that the company was selected by eRDF-ectricitReau Distribution France, the public electricity distribution company managing 95% of the electricity distribution network in continental France, as one of the six suppliers to manufacture the first three milliion of its new generation Linky smart meters. The initial order is the first phase of a 35 million unit rollout by 2021.
JK Tyre & Industries gained 0.92% to Rs 504.30 after the company scheduled a board meeting on 25 September 2014 to consider stock-split proposal. The stock hit a record high of Rs 534.90 in intraday trade.
L&T declined 0.1% at Rs 1,533.80. The company said during market hours that its construction division has won new orders worth Rs 1577 crore across various business segments in September 2014.
Hotel Leelaventure declined 2.12% at Rs 23.05 after the company said that it did not pay Rs 22.50 crore towards first installment of interest, which was due on 31 March 2014. Further, the company has also not paid the quarterly interest, which fell due on 19 June 2014 and 19 September 2014. The company did not give further details. The debt is reportedly serviceable to state-owned life insurer Life Insurance Corporation of India (LIC) and the company is seeking more time for repayment.
HCL Infosystems gained 1.34% to Rs 90.85. US investment management firm Van Eck Associates Corporation A/c Market Vectors Vietnam bought 18.19 lakh shares of HCL Infosystems at an average price of Rs 88.64 per share in a bulk deal on NSE on Friday, 19 September 2014.
Kitex Garments spurted 19.84% at Rs 489.55 on reports that a prominent domestic brokerage initiated a buy rating on the stock citing the company's "strong presence" in infant wear where competitors have struggled due to "stringent" safety norms.
The Sensex has gained 568.63 points or 2.13% in this month so far (till 22 September 2014). The Sensex has gained 6,036.06 points or 28.51% in calendar year 2014 so far (till 22 September 2014). From a record high of 27,354.99 on 8 September 2014, the Sensex has declined 148.25 points or 0.54%. From a 52-week low of 19,264.72 on 1 October 2013, the Sensex has risen 7,942 points or 41.22%.
Indian stocks may remain volatile this week as traders roll over positions in the futures & options (F&O) segment from the near month September 2014 series to October 2014 series. The near-month September 2014 F&O contracts expire on Thursday, 25 September 2014.
In the foreign exchange market, the rupee was a tad higher against the dollar. The partially convertible rupee was hovering at 60.82, compared with its close of 60.83 during the previous trading session.
Brent crude oil prices edged lower as sluggish demand and abundant supplies outweighed a possible cut in oil output from the Organization of the Petroleum Exporting Countries (OPEC). Brent for November settlement was off 43 cents at $97.96 a barrel. The contract had risen 69 cents a barrel or 0.71% to settle at $98.39 a barrel on Friday, 19 September 2014.
Lower crude oil prices will help India in containing its fiscal deficit, current account deficit and fuel price inflation. India imports 80% of its crude oil requirement.
Prime Minister Narendra Modi is scheduled to launch the ambitious 'Make in India' campaign on Thursday, 25 September 2014. The initiative is one of the several steps which government has announced in order to improve ease of doing business in India and attract investments to boost manufacturing in the country. In his maiden independence day address, Modi invited the global business community to set up manufacturing facilities in India, giving the slogan 'come, make in India'.
Meanwhile, Finance Minister Arun Jaitley was reportedly admitted to the Max Institute private hospital in New Delhi yesterday, 21 September 2014, for a routine post-operative examination. Jaitely this month underwent gastric bypass surgery to treat weight gain he had suffered because of a long-standing diabetic condition.
European stocks dropped today, 22 September 2014, tracking weak commodity prices and as China's finance minister damped speculation his government will boost economic stimulus for the world's second biggest economy. Key indices in Germany, London and France were off 0.03% to 0.88%.
Italian industrial orders dropped in July as both foreign and domestic demand slipped, underscoring the struggle of euro zone's third-largest economy to exit a prolonged recession. Industrial orders declined 1.5% on the month, after a similar drop in June, national statistics institute Istat said today, 22 September 2014, using seasonally adjusted data. Orders were down 0.7% on the year in unadjusted terms, Istat added. Orders are a proxy for future industrial output, a key metric for Italy, which has Europe's second-largest manufacturing sector.
Asian stocks fell today, 22 September 2014, amid speculation China may accept slower growth and after officials from the world's biggest economies warned of rising financial risks. Key benchmark indices in Singapore, Hong Kong, Indonesia, Taiwan, Japan and South Korea were off 0.15% to 1.7%.
China's Finance Minister Lou Jiwei said growth in Asia's largest economy faces downward pressure and reiterated that there won't be major changes in policy in response to individual economic indicators. China's economy is growing in a stable way and operating within a reasonable range, Lou said in a statement published on the People's Bank of China website. Macroeconomic policy will focus on comprehensive targets, particularly job growth and price stability, the statement said.
A preliminary reading on the HSBC Holdings Plc/Markit Economics China manufacturing purchasing managers' index is due tomorrow, 23 September 2014.
Trading in US index futures indicated that the Dow could fall 41 points at the opening bell on Monday, 22 September 2014. Most US stocks edged lower on Friday, 19 September 2014, after a three-day rally
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