Key benchmark indices pared gains in mid-morning trade. The barometer index, the S&P BSE Sensex, was up 66.86 points or 0.3%, off close to 70 points from the day's high and up about 20 points from the day's low. The market breadth, indicating the overall health of the market, was strong. The BSE Small-Cap index was up more than 1%.
Realty stocks edged higher. Among cement shares, UltraTech Cement reversed direction after hitting record high.
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.
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 11:20 IST, the S&P BSE Sensex was up 66.86 points or 0.3% to 22,410.31. The index jumped 135.62 points at the day's high of 22,479.07 in morning trade. The index rose 45.76 points at the day's low of 22,389.21 in opening trade.
The CNX Nifty was up 17.90 points or 0.27% to 6,712.95. The index hit a high of 6,733.60 in intraday trade, its highest level since 4 April 2014. The index hit a low of 6,710.65 in intraday trade.
The BSE Mid-Cap index was up 68.81 points or 0.96% at 7,234.17. The BSE Small-Cap index was up 73.25 points or 1.01% at 7,354.32. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1,378 shares rose and 696 shares fell. A total of 106 shares were unchanged.
Sun Pharmaceutical Industries (up 6.65%), Tata Motors (up 2.21%) and Hindalco Industries (up 4.52%) edged higher from the Sensex pack.
Realty stocks edged higher. D B Realty (up 4.63%), Housing Development & Infrastructure (HDIL) (up 0.28%), Parsvnath Developers (up 1.97%), Godrej Properties (up 0.81%) and Unitech (up 2.28%) gained. Sobha Developers fell 2.47%.
DLF rose 1.93%. The company after market hours on Monday, 7 April 2014, in a clarification to the stock exchanges regarding news item titled "DLF slapped Rs 2.4 crore penalty by competition watchdog" said that the Competition Commission of India (CCI) had passed order charging a penalty of Rs 2.4 crore against the company in August 2011 based on complaints filed by certain alleged apartment owners association. The Competition Appellate Tribunal (COMPAT) vide its order dated 9 November 2011 granted stay against the orders of CCI imposing penalty and have further ordered that direction of CCI for modification of the terms of agreement shall remain in abeyance, DLF said.
DLF said that the current order appears to be a sub-set of ongoing cases. The company is perusing the order and seeking counsel's advice including but not limited to appealing against the above, DLF said.
UltraTech Cement fell 0.14% to Rs 2217.15, with the stock reversing direction after hitting record high of Rs 2,231.60 in intraday trade.
Gulf Oil Corporation rose 3.57% to Rs 120.45 after the company said that its promoter has recently acquired additional shares to the extent of 4.99%, increasing its shareholding in the company to 54.96%. The stock hit a high of Rs 120.95 so far during the day, which is a 52-week high for the counter. The announcement was made after market hours on Monday, 7 April 2014. Gulf Oil Corporation said that the company's promoter, Gulf Oil International (Mauritius) Inc. (GOIMI) has recently acquired additional shares to the extent of 4.99%, increasing its shareholding in the company to 54.96%. With this, the company becomes subsidiary of GOIMI, Gulf Oil Corporation said.
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 60.01, 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.
Indian government bond prices edged higher on speculation a rally in yields to the highest level since November attracted investors. The yield on 10-year benchmark federal paper, 8.83% GS 2023, was hovering at 9.0919%, lower than its close of 9.1006% on Monday, 7 April 2014. India's financial markets were closed on Tuesday, 8 April 2014, on account of Ram Navami. Bond yield and bond prices move in opposite direction. Ten-year yields surged 30 basis points over the last four trading sessions on concern demand for existing notes will suffer due to increased issuance by the government. The government will sell Rs 16000-crore of debt at an auction on 11 April 2014, the Reserve Bank of India said last week. That's the second sale for the fiscal year that began April 1 after the government sold an equal amount of securities on April 4.
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.
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 0.18% to 0.92%. Japanese equities fell after the yen rose against the dollar. The Nikkei 225 Average was off 1.92%.
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 gain 6 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 Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 29-30 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.
In Europe, 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.
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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