Volatility continued in afternoon trade as the key benchmark indices once again turned negative after an intraday recovery pushed key indices to hit fresh intraday high in positive zone in early afternoon trade. The barometer index, the S&P BSE Sensex, was currently off 49.12 points or 0.18% at 27,301.56. The market breadth indicating the overall health of the market was weak.
Telecom stocks declined. Bharti Airtel rose in volatile trade after the company during market hours today, 15 December 2014 announced an agreement under which IHS Holding will acquire Bharti's over 1,100 telecom towers across in Zambia and Rwanda. Reliance Communications hit 52-week low. Among private banks, shares of ING Vysya Bank and IndusInd Bank scaled record high while Kotak Mahindra Bank and DCB Bank hit 52-week high.
Foreign portfolio investors sold shares worth a net Rs 864.96 crore during the previous trading session on Friday, 12 December 2014, as per provisional data.
The Sensex and the 50-unit CNX Nifty, had, both hit 6-1/2-week at the onset of the trading session on weak Asian stocks.
On the macro front, WPI eased to 0.0% (provisionally) for the month of November, 2014 as compared to 1.77% (provisional) for the previous month and 7.52% during the corresponding month of the previous year. Data on WPI was released during market hours. Industrial production declined 4.2% in October 2014, compared with 2.8% (revised) increase in September 2014, due to a 2.5% decline in the manufacturing sector in October 2014. Meanwhile, the annual rate of inflation based on the combined consumer price indices (CPI) for urban and rural India eased to 4.4% in November 2014 from 5.5% in October 2014, driven by a sharp decline in inflation for food articles. Data on both industrial production and CPI was released after trading hours on Friday, 12 December 2014.
In overseas markets, Asian stocks edged lower after a sharp setback for US stocks on Friday, 12 December 2014. US stocks tumbled on Friday, 12 December 2014, as the sustained drop in oil prices revived growth concerns.
In the foreign exchange market, the rupee edged lower against the dollar, tracking losses for most Asian currencies against the dollar.
Brent crude futures bounced back after hitting 5-1/2-year low of $60.28 earlier in the session, as traders began pricing in expectations of improving manufacturing data to be published later this week.
At 13:12 IST, the S&P BSE Sensex was off 49.12 points or 0.18% at 27,301.56. The index rose 24.55 points at the day's high of 27,375.23 in early afternoon trade. The index lost 245.64 points at the day's low of 27,105.04 in early trade, its lowest level since 30 October 2014.
The CNX Nifty was off 11.70 points or 0.14% at 8,212.40. The index hit a high of 8,237.in intraday trade. The index hit a low of 8,152.50 in intraday trade, its lowest level since 30 October 2014.
The BSE Mid-Cap index was off 34.61 points or 0.34% at 10,073.99. The BSE Small-Cap index was off 40.16 points or 0.36% at 11,028.32. The fall in these two indices was higher than the Sensex's decline in percentage terms.
The market breadth indicating the overall health of the market was weak. On BSE, 1,564 shares fell and 1,016 shares rose. A total of 105 shares were unchanged.
The total turnover on BSE amounted to Rs 1675 crore by 13:15 IST.
NMDC fell 1.15%. With respect to the news reports titled NMDC to buy Akron Stake, NMDC during market hours today, 15 December 2014 clarified that the memorandum of understanding (MoU) has been signed between NMDC, India (on behalf of a consortium comprising NMDC and fertilizer companies, namely RCF, KRIBHCO, NFL and FACT). The basic objective of the MoU is for development of Verkhnekamsk Potassium and Magnesium Salt Deposit in Perm Krai (VPC Potash Project). The VPC Project is expected to have a total capital investment of $2 billion. The consortium led by NMDC has expressed interest in becoming a strategic investor by acquiring 30% stake in VPC, subject to viable techno-economics of the VPC Project based on comprehensive due diligence in potash assets of VPC, NMDC said.
Telecom stocks declined. Bharti Airtel was up 0.06% at Rs 348. The stock was volatile. The scrip hit high of Rs 349.70 and low of Rs 341.45 so far during the day. Bharti Airtel during market hours today, 15 December 2014 announced an agreement under which IHS Holding will acquire Bharti's over 1,100 telecom towers across in Zambia and Rwanda. Bharti Airtel said that the sale of telecom towers in the two African countries will the company to focus on its core business and customers, enable it to deleverage through debt reduction, and will significantly reduce its on-going capital expenditure on passive infrastructure in these African markets. As per the agreement with IHS Holding, Bharti Airtel will sell and lease back over 1,100 towers from IHS in Zambia and Rwanda under a 10-year renewable contract. This agreement will accelerate infrastructure sharing amongst operators and benefit customers in form of affordable tariffs and wider network coverage, said Christian de Faria, MD & CEO - Africa, Bharti Airtel. The agreements are subject to statutory and regulatory approvals, Bharti Airtel said.
Reliance Communications dropped 3.07% to Rs 86.95 after hitting a 52-week low of Rs 86.55 in intraday trade.
Idea Cellular (down 1.96%), Tata Teleservices (Maharashtra) (down 2.32%) edged lower. MTNL rose 0.38%.
ING Vysya Bank advanced 2.83% to Rs 874.50 after scaling a record high of Rs 886.85 in intraday trade.
Kotak Mahindra Bank gained 3.45% to Rs 1,289.95 after hitting a 52-week high of Rs 1,302.70 in intraday trade. ING Vysya Bank during market hours today, 15 December 2014, said that in accordance with the terms of the proposed merger and as assured by Kotak Mahindra Bank in its public statement, Kotak would respect and honour all employee-related contractual commitments of ING Vysya Bank as agreed upon in the merger deal. ING Vysya Bank further said it will abide by its obligations to make appropriate disclosures as and when such disclosures are necessitated by decisions taken by the bank.
Kotak and ING Vysya Bank on 20 November 2014 had approved an all-stock amalgamation of ING Vysya Bank with Kotak Mahindra Bank.
IndusInd Bank rose 0.81% to Rs 785 after scaling a record high of Rs 799.50 in intraday trade.
DCB Bank rose 2.34% to Rs 109.50 after hitting a 52-week high of Rs 111 in intraday trade.
In the foreign exchange market, the rupee edged lower against the dollar, tracking losses for most Asian currencies against the dollar. The partially convertible rupee was hovering at 62.73, compared with its close of 62.29 during the previous trading session.
Brent crude futures bounced back after hitting 5-1/2-year low of $60.28 earlier in the session, as traders began pricing in expectations of improving manufacturing data to be published later this week. Brent for January settlement was up 61 cents at $62.46 a barrel. The contract had lost $1.83 a barrel or 2.9% to settle at $61.85 during the previous trading session on Friday, 12 December 2014, the lowest closing level since July 2009. Brent for February settlement was up $1.03 a barrel to 62.80 a barrel.
WPI eased to 0.0% (provisionally) for the month of November, 2014 as compared to 1.77% (provisional) for the previous month and 7.52% during the corresponding month of the previous year. Build up inflation rate in the financial year so far was 0.67% compared to a build up rate of 6.70% in the corresponding period of the previous year. For the month of September, 2014, the final WPI remained unchanged at its provisional level of 2.38% as reported on 14 October 2014.
Index of industrial production (IIP) declined, at a sharpest pace in three-years, contracting 4.2% in October 2014 compared with 2.8% (revised) increase in September 2014. The manufacturing sector's output dipped to 2.5% in October 2014, recording largest decline in last five-and-half years. The decline in the industrial production was entirely contributed by the manufacturing sector. Lesser number of working days in October 2014 mainly led to sharp decline in manufacturing sectors output.
The annual rate of inflation based on the combined consumer price indices (CPI) for urban and rural India eased to 4.4% in November 2014 from 5.5% in October 2014, driven by a sharp decline in inflation for food articles. The corresponding provisional inflation rates for rural area were 4.1% and urban area also 4.7% as against 5.5% and 5.6% for October 2014.
Meanwhile, the Indian government intends to get the Insurance Laws (Amendment) Bill, 2008 passed in both the Houses of Parliament in this week. The Union Cabinet, last week, approved the official amendments to the Insurance Laws (Amendment) Bill, 2008. The Parliamentary Select Committee in its report tabled in Rajya Sabha on 10 December 2014 agreed a composite cap of 49% on foreign investment in the insurance sector, which includes all types of foreign investment as opposed to the 26% foreign direct investment (FDI) allowed at present. Finance Minister Arun Jaitley had said in his maiden budget speech in July that the composite cap in the insurance sector should be increased to 49% from the current level of 26%, with full Indian management and control.
The Lok Sabha on Friday, 12 December 2014, passed the Coal Mines (Special Provisions) Bill, 2014. The bill allows the government to enforce rules and guidelines for auction/allocation of 204 coal blocks cancelled by the Supreme Court in September this year. The challenge for the government now will be to find support for the bill in the Rajya Sabha where it's in a minority.
Asian stocks edged lower today, 15 December 2014, after a sharp setback for US stocks on Friday, 12 December 2014. US stocks tumbled on Friday, 12 December 2014, as the sustained drop in oil prices revived growth concerns. Key indices in Hong Kong, Singapore, Indonesia, South Korea, Hong Kong and Taiwan were off 0.07% to 1.57%. China's Shanghai Composite index rose 0.52%.
Japanese Prime Minister Shinzo Abe's coalition cruised to a big election win on Sunday, 14 December 2014, ensuring he will stick to reflationary economic policies and a muscular security stance, but record low turnout pointed to broad dissatisfaction with his performance.
Confidence of Japan's large manufacturers declined in the fourth quarter as a recession offset a boost from a weaker yen, underlining the economic challenges facing Prime Minister Shinzo Abe after his election win. The Tankan's big manufacturer index slipped to 12 in December from 13 in September Bank of Japan today, 15 December 2014.
Meanwhile, large parts of central Sydney were in lockdown today, 15 December 2014, after at least one gunman took hostages in a cafe and placed an Islamic flag in the window, sparking concerns a terrorist attack was under way. Authorities sealed off surrounding streets, evacuated people from buildings, and suspended several rail routes into and out of the city after the incident began around 9:45 a.m. at the Lindt Chocolate Cafin Martin Place in the heart of the business district.
Trading in US index futures indicated that the Dow could gain 45 points at the opening bell today, 15 December 2014. US stocks sank on Friday, 12 December 2014, as oil prices continued to slide. The US Senate on Saturday, 12 December 2014, passed a $1.1 trillion spending bill that lifts the threat of a government shutdown as Congress attempts to wrap up a two-year legislative session marked by bitter partisanship and few major accomplishments. The Senate's 56-40 vote sends the measure to President Barack Obama, who is expected to sign it into law before federal spending authority expires at midnight.
A two-day meeting of Federal Open Market Committee (FOMC) to discuss monetary policy review starts tomorrow, 16 December 2014. The policy meeting will be keenly watched for any hints on the timing of interest rate increases in the world's biggest economy. It remains to be seen whether Federal Reserve officials would signal a rate hike by dropping their assurance that rates will stay low for a considerable time.
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