Tuesday 25 February 2014

Sensex, Nifty strike over 4-1/2 week high

 A bout of volatility was witnessed in morning trade as the key benchmark indices trimmed gains after hitting fresh intraday high. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both hit their highest level in over 4-1/2 weeks. The S&P BSE Sensex was up 59.52 points or 0.29%, off 27.28 points from the day's high and up 51.97 points from the day's low. The market breadth, indicating the overall health of the market, was positive.

Index heavyweight and cigarette major ITC edged higher. Reliance Industries was marginally higher in volatile trade after the company in a press release on Tuesday, 25 February 2014 said it strongly denies all allegations made by Aam Admi Party (AAP) against RIL and Mr. Mukesh Ambani in their public meeting recently. State Bank of India (SBI) extended initial gain after the state-run bank said after market hours on Tuesday, 25 February 2014 that a meeting of the board of directors of the bank will be held on 3 March 2014 to consider declaration of interim dividend for the financial year ending 31 March 2014. Capital goods stocks edged higher on renewed buying. Bharat Heavy Electricals (Bhel) rose on reports that the country's largest insurer, Life Insurance Corporation (LIC), may reportedly pick up 5% stake in state-run power equipment maker in a block deal. Sanofi India rose after declaring strong Q4 result after market hours on Tuesday, 25 February 2014.

Key benchmark indices trimmed initial gains triggered by mostly higher Asian stocks. A bout of volatility was witnessed in morning trade as the key benchmark indices trimmed gains after hitting fresh intraday high. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both hit their highest level in over 4-1/2 weeks.

Volatility may remain high today, 26 February 2014, as traders roll over positions in the futures and options (F&O) segment from the near-month February 2014 series to March 2014 series. The near month February 2014 F&O contracts expire today, 26 February 2014.

Foreign institutional investors (FIIs) bought shares worth a net Rs 423.41 crore on Tuesday, 25 February 2014, as per provisional data from the stock exchanges.

At 10:15 IST, the S&P BSE Sensex was up 59.52 points or 0.29% to 20,911.99. The index gained 86.80 points at the day's high of 20,939.27 in morning trade, its highest level since 24 January 2014. The index rose 7.55 points at the day's low of 20,860.02 in early trade.

The CNX Nifty was up 13.65 points or 0.22% to 6,213.70. The index hit a high of 6,222.90 in intraday trade, its highest level since 24 January 2014. The index hit a low of 6,202.10 in intraday trade.

The market breadth, indicating the overall health of the market, was positive. On BSE, 966 shares gained and 691 shares fell. A total of 77 shares were unchanged.

The BSE Mid-Cap index rose 7.70 points or 0.12% to 6,470.02, underperforming the Sensex. The BSE Small-Cap index rose 25.14 points or 0.39% to 6,446.84, outperforming the Sensex.

The total turnover on BSE amounted to Rs 402 crore by 10:20 IST compared to Rs 122 crore by 09:25 IST.

Among the 30-share Sensex pack, 21 stocks gained and rest of them declined.

Sesa Sterlite (down 2.09%), Coal India (down 1.5%) and ONGC (down 0.96%) edged lower from the Sensex pack.

Index heavyweight and cigarette major ITC rose 0.96% to Rs 325. The stock hit high of Rs 325.30 and low of Rs 322.40 so far during the day.

Reliance Industries (RIL) rose 0.06% to Rs 811 in volatile trade. The stock hit high of Rs 813.90 and low of Rs 809.50 so far during the day. RIL in a press release on Tuesday, 25 February 2014 said it strongly denies all allegations made by Aam Admi Party (AAP) against RIL and Mr. Mukesh Ambani in their public meeting recently.

As stated earlier it is being reiterated that neither RIL nor Mr. Mukesh Ambani have or had any illegitimate accounts anywhere in the world. RIL has business interests in several countries with turnover of thousands of crores in Rupees. As a part of their normal business, these international subsidiaries of RIL deal with several global banks. These accounts are fully compliant with all regulations and are disclosed in their appropriate jurisdictions and in India. The continued tirade of baseless allegations being made by AAP against us appears to be instigated by vested interests, RIL said.

State Bank of India (SBI) rose 1.08%, with the stock extending initial gain. The state-run bank said after market hours on Tuesday, 25 February 2014 that a meeting of the board of directors of the bank will be held on 3 March 2014, inter alia, to consider, and if thought fit, declare interim dividend for the financial year ending 31 March 2014.

Capital goods stocks edged higher on renewed buying. ABB India (up 7.23%), BEML (up 0.54%), Crompton Greaves (up 0.19%), L&T (up 0.43%), Siemens (up 4.29%) and Thermax (up 1.23%) gained.

Bharat Heavy Electricals (Bhel) rose 1.06%. The country's largest insurer, Life Insurance Corporation (LIC), may reportedly pick up 5% stake in state-run power equipment maker Bhel in a block deal. According to a media report, the proposal initiated by the heavy industries & public enterprises ministry is now being processed by the disinvestment and financial services department of the finance ministry.

Sanofi India rose 1.73% after net profit surged 106.92% to Rs 92.70 crore on 15.49% increase in total income from operations to Rs 488.30 crore in Q4 December 2013 over Q4 December 2012. The company announced the results after market hours on Tuesday, 25 February 2014.

Sanofi India's net profit jumped 50.08% to Rs 265.20 crore on 14.99% increase in total income from operations to Rs 1808.90 crore in the year ended December 2013 over the year ended December 2012.

The stock market remains closed tomorrow, 27 February 2014, on account of Mahashivratri.

The Securities and Exchange Board of India (Sebi) on Tuesday, 25 February 2014 proposed in a discussion paper that appointment of an agency to monitor the utilization of funds raised through an initial public offering (IPO) should be made mandatory. Currently, such an appointment is compulsory only if the public issue size exceeds Rs 500 crore. Sebi said the move is aimed at strengthening the monitoring of utilization of all the equity capital raised by selling shares to the public.

In its latest discussion paper, Sebi proposed that the appointed agency will be required to submit its report to the issuer every quarter till the full utilization of the public issue proceeds, as compared to the requirement of submission of such reports on a half-yearly basis at present. Also, such reports will be required to be put out on the stock exchanges' website to keep investors informed.

To curb misuse of money raised through a public issue, Sebi proposed to make it mandatory for the monitoring agency to assign grades to the issuer.

In order to ensure that the monitoring process is carried out effectively, Sebi proposed that a committee of board of directors of the company has to be constituted to oversee the monitoring of utilization of issue proceeds before opening of the public issue. This sub-committee will facilitate monitoring of issue proceeds by monitoring agency. A majority of the members of such a sub-committee will have to be independent directors, Sebi suggested.

Sebi has sought public comments on the proposals till 25 March 2014.

The Reserve Bank of India next undertakes monetary policy review on 1 April 2014. Citing price pressures, the Reserve Bank of India raised its key lending rates by 25 basis points after Third Quarter Review of Monetary Policy for 2013-14 on 28 January 2014.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 61.97, compared with its close of 61.9350/9450 on Tuesday, 25 February 2014.

Asian stocks swung between gains and losses as energy shares advanced, countering declines by raw-material producers. Key benchmark indices in China, Hong Kong, South Korea and Taiwan rose by 0.14% to 0.47%. Key benchmark indices in Singapore, Japan and Indonesia fell by 0.34% to 0.58%.

Taiwan's jobless rate nudged lower last month, as the labor force participation rate decreased, the government said today, 26 February 2014.

The island's nominal jobless rate came in at 4.02% in January, down from December's 4.08%, the Directorate-General of Budget, Accounting and Statistics said.

On a seasonally adjusted basis, the jobless rate was 4.07% in January, down from 4.12% in December, the government said.

US stocks finished a choppy trading session lower on Tuesday, 25 February 2014 as gloomy reports on home prices and consumer confidence dampened the mood.

US home prices ticked down 0.1% in December, declining for a second month, with 11 of 20 tracked cities posting drops, according to S&P/Case-Shiller's composite index. After seasonal adjustments, home prices in December rose 0.8%, down a bit from 0.9% in November.

The consumer confidence index fell to 78.1 in February from 79.4 in January, the Conference Board said Tuesday, 25 February 2014.

The Federal Open Market Committee (FOMC) next undertakes monetary policy review on 18-19 March 2014. After a monetary policy review, the FOMC on 29 January 2014 announced it will reduce monthly bond purchases by another $10 billion to $65 billion.


From BS News

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