Sensex recovers 130 points ahead of RBI policy

 

After two sessions of losses, the benchmark BSE Sensex rose over 130 points in early trade on Tuesday on fresh spell of buying by participants ahead of RBI’s monetary policy review. 

The 30-share index, which had lost 559.50 points in the previous two sessions, recovered by 130.79 points, or 0.44 per cent, to 29,253.06, with consumer durables, FMCG, oil & gas, auto and banking sector stocks leading the rise. 

On similar lines, the National Stock Exchange index Nifty gained 26.00 points, or 0.30 per cent, to 8,823.40 in early trade. 

Brokers said besides mixed trend at other Asian bourses and overnight gains in the US markets, selective buying by cautious funds and retail investors ahead of RBI’s policy review due later in the day influenced sentiments. 

Among other Asian markets, Hong Kong Hang Seng moved up 0.24 per cent, while Japan’s Nikkei shed 0.27 per cent in early trade today. 

The US Dow Jones Industrial Average ended 1.14 per cent higher in Monday’s trade.

Gold drops Rs. 180 on low demand, global cues

 

Gold prices on Tuesday fell by Rs. 180 to Rs. 28,270 per ten gram at the bullion market, snapping its two-day rising streak, as demand from jewellers and retailers eased at prevailing levels amid a weak global trend.

Silver, however, recovered by Rs. 450 to Rs. 38,450 per kg on increased off-take by industrial units and coin makers.

Traders said besides fall in demand at existing levels from jewellers and retailers at domestic markets, a weak global trend as investors weighed prospects for higher U.S. interest rates mainly kept pressure on gold prices.

Gold in New York, which normally sets price trend on the domestic front, fell 0.72 per cent to $1,273.80 an ounce in Monday’s trade.

In the national capital, gold of 99.9 and 99.5 per cent purity plunged by Rs. 180 each to Rs. 28,270 and Rs. 28,070 per ten gram respectively. The precious metal had gained Rs. 350 in the previous two trading sessions.

Sovereign, however, continued to be traded at last level of Rs. 24,000 per piece of eight gram in limited deals. On the other hand, silver ready recovered by Rs. 450 to Rs. 38,450 per kg and weekly-based delivery by Rs. 50 to Rs. 38,000 per kg.

Meanwhile, silver coins enquired at previous level of Rs. 63,000 for buying and Rs. 64,000 for selling of 100 pieces.

Rupee up 15 paise against dollar

 

The rupee strengthened by 15 paise to 61.65 against the US dollar in early trade on Tuesday at the Interbank Foreign Exchange on increased selling of the American currency by exporters ahead of RBI’s policy review.

Dealers said increased selling of the dollar by exporters and a higher opening in the domestic equity market supported the rupee but the greenback’s rise against some overseas currencies capped the gains.

The rupee had gained six paise to close at 61.80 against the American currency in yesterday’s trade on fag-end selling pressure from banks and exporters due to a weak dollar in the overseas markets.

Rupee gains 13 paise to end at nearly 1-week high against U.S. dollar

 

Bucking the weak trend in stocks, Indian rupee on Tuesday strengthened 13 paise to end at nearly one-week high of 61.67 against the greenback on persistent selling of dollars by banks and exporters on a day the RBI kept interest rates unchanged.

The rupee opened higher at 61.65 per dollar as against the yesterday’s closing level of 61.80 at the Interbank Foreign Exchange (Forex) market. It moved up further to 61.61 per dollar on initial selling of dollars by banks.

However, it fell to 61.84 per dollar in the afternoon on fresh demand from some banks before closing at 61.67 per dollar, showing a gain of 13 paise or 0.21 per cent from its last close.

The rupee has now gained by 19 paise, or 0.31 per cent, in two days and has closed at its strongest level since 61.41 on January 28, 2015.

The local currency moved in a range of 61.61 per dollar and 61.84 per dollar during the day.

“Foreign inflows and hopes of rates cuts in the future continued to support the local currency. Foreign investors were net buyers of $120.68 million in Indian markets yesterday and purchased a total $6.818 billion in 2015,” said Admisi Forex India, Director, Suresh Nair.

The Reserve Bank of India (RBI) earlier today left repo rate unchanged at 7.75 per cent, but cut SLR by 50 bps to 21.50 per cent from 22 per cent.

In international Forex markets, the widely-tracked dollar index was down by 0.05 per cent against a basket of major global rivals.

In the Tokyo market, the dollar was lower against the yen on Monday, with investors seeking to take profits on overnight gains in the greenback.

In the New York market, the Canadian dollar, Norwegian krone and Russian ruble rose against the U.S. dollar yesterday as oil prices fluctuated.

Meanwhile, the Indian equity benchmark Sensex dropped by 122.13 points, or 0.42 per cent, to close at nearly two-week low of 29,000.14.

“Some banks were selling dollars in the market which helped the rupee trade strong against the U.S. dollar. The trading range for the spot USD/INR pair is expected to be within 61.20 to 62.20,” said Veracity Group, CEO, Pramit Brahmbhatt.

Meanwhile, the forward premia recovered sharply on fresh paying pressure from corporates.

The benchmark six-month premium payable in July ended higher at 222.5-224.5 paise from 218-220 paise yesterday and forward contracts maturing in January 2016 also rose to 428- 430 paise from 417-419 paise.

The Reserve Bank of India fixed the reference rate for dollar at 61.7389 and for Euro at 69.9378.

The rupee eased against the pound to 92.89 per pound from 92.82 per pound previously while moved up against the euro to 69.99 per euro from 70.02.

However, the rupee ended steady against the yen to 52.51 per 100 yen.

Sensex falls to two-week low; bank shares slip as RBI holds rates

 

Markets fell for the third straight session with the benchmark Sensex today slipping 122.13 points to end at nearly two-week low of 29,000.14, weighed down by rate-sensitive banking and realty shares after the RBI disappointed markets by not lowering interest rates. 

In highly volatile trade, the BSE Sensex opened higher and rallied to 29,253.06 in early deals. However, it entered the negative terrain after the RBI policy was announced and even dipped below the 29,000-mark to touch low of 28,900.41. 

However, the bluechip index managed to gain some ground and closed at 29,000.14, down 122.13 points, or 0.42 per cent. 

The gauge has now lost 681.63 points in three days and closed at its weakest since 28,888.86 on January 21, 2015. 

On similar lines, the 50-share NSE index Nifty finished 40.85 points down, or 0.46 per cent, at 8,756.55 after moving between 8,726.65 and 8,837.30 intra-day. 

RBI today left interest rate unchanged at 7.75 per cent, but cut the statutory liquidity ratio (SLR) - the amount of funds that lenders must set aside — by 50 basis points to 21.5 per cent of deposits from February 7. 

“Markets showed their disappointment on the outcome of monetary policy,” said Bonanza Portfolio, Associate Fund Manager, Hiren Dhakan. 

Among prominent banking stocks, Axis Bank, SBI, HDFC Bank and ICICI Bank fell up to 4.95 per cent. 

Sectorwise, the BSE Banking index suffered the most by falling 2.61 per cent largely on the fall in stocks post the RBI policy announcement. 

In other sectoral indices, BSE Realty index fell 1.43 per cent, Healthcare index (0.92 per cent), Power index (0.68 per cent) and Auto index (0.66 per cent) among others. 

In the 30-share Sensex constituents, 16 ended lower and 14 gained, helping the benchmark indices trim losses. 

Meanwhile, oil firms were in better form with Reliance Industries up 3.25 per cent and ONGC up 2.64 per cent after a rebound in international crude prices. 

Globally, a rise in European stocks at opening and a mixed trend at the other Asian markets also influenced the trading sentiments here, a broker said. 

Meanwhile, Foreign Portfolio Investors sold shares worth a net Rs. 629.97 crore on Monday as per provisional data.

Videocon, BPCL consortium discover oil off Brazil coast

A consortium of Videocon Industries, Bharat Petroleum Corporation Ltd. (BPCL) and Brazilian state-owned company Petroleo Brasileiro SA (Petrobras) has announced ‘significant’ discovery of oil, off the coast of Brazil.

“The well 3-SES-186 was drilled 103 km from the city of Aracaju, Brazil, and 10 km from the discovery well in 2,467 metre of water. The well will be drilled to 6,060 metres. This accumulation is part of the exploratory project in the deepwater Sergipe-Alagoas basin,” Videocon said.

Petrobras operates the consortium with 60 per cent interest in partnership with IBV-Brazil (an equal joint venture of Videocon Industries and BPCL), which holds the remaining 40 per cent.

“The result obtained in this well confirms the extension of the light oil reservoirs previously discovered by the ‘Farfan’ discovery well.

In addition, the well found presence of a new light oil accumulation with a total thickness of 68 metres in shallower reservoirs,” Videocon added.

Videocon Group Chairman V.N. Dhoot, when contacted, declined to comment on the size of the discovery but said, ‘it’s naturally huge’.

“The discovery of new hydrocarbon accumulations will further add to the hydrocarbon resources already indicated in the said blocks. 

The large scale and volume and light oil discovery will enable one of the lowest cost producing giant oil fields in the world,” Mr. Dhoot added.

ACC Q4 net up 18 per cent

 

Leading cement manufacturer ACC reported an 18 per cent rise in its net profit for the fourth quarter of 2014 at Rs. 326 crore. This was largely aided by a tax reversal of Rs. 184.35 crore (Rs. 35.85 crore in the year-ago period).

The company which follows the calendar year, reported a 3 per cent rise in net sales for the quarter at Rs. 2,762 crore. The company profit from operations for the period declined to Rs. 110.38 crore (Rs. 206.72 crore) and the operating margin declined 420 basis points to 9.2 per cent. These were impacted by high raw material and freight costs.

For the year 2014, ACC reported a 6 per cent growth in net profit at Rs. 1,161.82 crore while net sales grew 5.4 per cent at Rs. 11,480.31 crore. The Board of directors has recommended a final dividend of Rs. 19 per share, which with the earlier interim dividend of Rs. 15 takes total dividend for the year to Rs. 34.

A statement from the company said cement selling price improved 4 per cent in 2014 and sales volume was marginally higher at 24.2 million tonne (23.9 million tonne). ACC’s limestone mining operations at Chaibasa and Bargarh plants were temporarily suspended during the fourth quarter following a Supreme Court order. “As per the New Mining Ordinance of January 2015, we expect these operations to commence shortly,” the company statement said.

“Based on the present condition, we see a modest but steady revival for the Indian economy in 2015 leading to some improving trends in all sectors of the economy with a positive impact on demand for cement,” the statement said.

On the Bombay Stock Exchange, ACC reacted by 1.02 per cent to close trade at Rs. 1,510.6 on Tuesday.