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Wednesday, 29 October 2014

Sensex surges 217 pts, Nifty ends at 8090 ahead of expiry

03:30 Market closing

The market ended with smart gains ahead of October F&O expiry tomorrow. The Nifty was up 62.85 points at 8090.45 while the Sensex ended up 217.35 points at 27098.17.

About 1589 shares advanced, 1374 shares declined, and 115 shares were unchanged.

Hindalco was up 6 percent while Tata Steel, Tata Motors, Infosys and Bajaj Auto were other major gainers in the Sensex. Among the losers were NTPC, Sun Pharma, Dr Reddy's Labs, Bharti Airtel and SBI.

03:15 pm Buzzing

Investors of SRF are rejoicing as its shares hit record high at Rs 805.85, up 20 percent intraday. The manufacturer of chemical-based industrial intermediates reported a 60.87 percent increase in net profit at Rs 76.85 crore for the second quarter ended September 2014. The company had posted a net profit of Rs 47.77 crore for the corresponding quarter a year ago. Total income from operations during the quarter under review increased 9.98 percent to Rs 928.17 crore as against Rs 843.89 crore a year ago, SRF said in a filing to the BSE.

"The overall operations performed well this quarter. The company's strategy of growing the chemicals business is paying dividends. Our traditional business should pick once economy rebounds," SRF managing director Ashish Bharat Ram said.

02:50 pm LPG rate hike

Subsidised cooking gas (LPG) rates have been hiked by Rs 3 per cylinder after the government raised the commission paid to dealers.

The commission paid to dealers was last week hiked by Rs 3 per 14.2-kg cylinder to Rs 43.71. Consequently, retail selling price of subsidised LPG too have been increased in the same proportion, officials said.

Dealers' commission was last revised in December 2013 when it was hiked by Rs 3.46 per cylinder to Rs 40.71. The increase in commission - which as per practice is passed on to consumers - has been effected from October 23.

Subsidised LPG in Delhi now costs Rs 417 per 14.2-kg cylinder as against Rs 414 previously. In Mumbai, subsidised LPG will cost Rs 452 per 14.2-kg cylinder as against Rs 448.50 previously. Prior to the December hike in LPG rates, price of cooking gas was raised in October 2012 when because of an increase in dealers' commission the rates were raised from Rs 399 per cylinder to Rs 410.50.

02:30pm Moody's on domestic banks

International rating agency Moody's today retained its negative outlook on the domestic banking system, citing high leverage in the corporate sector that may prevent any meaningful recovery in asset quality.

"Our outlook for the country's banking system remains negative, as it has been since November 2011. The negative outlook reflects our view that high leverage in the corporate sector could prevent any meaningful recovery in asset quality, notwithstanding a moderate rebound in economic growth," the agency Moody's Investors Service said in a note issued from Singapore.

The report further said continuing poor asset quality, wherein the NPAs levels are set to touch 4.5 percent of the system, will require continued provisioning and strengthened capital buffers. After provisions, profitability of public sector banks will generate insufficient internal capital for loan growth, the report added.

The negative outlook pertains mainly to the public sector banks as they represent more than 70 percent of total banking system assets. These banks have experienced higher growth rates in non-performing and restructured loans, as well as greater weakening in profits, than their private sector peers, Moody's said.
The report says while these trends are unlikely to improve for public sector banks, in contrast, private sector banks have stronger margins, reserves, and capital levels, which serve as buffers against conditions that remain challenging.

On growth, which inched up to surprising 5.7 percent in the first quarter of the current fiscal after logging in sub-5 percent growth in the past two fiscals, Moody's said GDP will pick up moderately this fiscal, but remains constrained by the high interest rates due to inflation.

02:00pm Market Check

Equity benchmarks maintained morning gains supported by auto, metals, FMCG, oil and technology stocks. The Sensex rose 144.26 points to 27025.08 and the Nifty climbed 39.55 points to 8067.15.

About 1527 shares have advanced, 1297 shares declined, and 108 shares are unchanged.

Hindalco Industries, DLF, JSPL and Tata Steel topped the buying list, up 4-5 percent followed by Tata Motors, M&M and Bajaj Auto with 2-3 percent.

However, Dr Reddy's Labs reported a weak Q2 earnings as profit fell 16 percent year-on-year to Rs 574 crore while Grasim Industries reported pressure in its viscose staple fibre business, standalone profit dropped 28 percent to Rs 299 crore while Oriental Bank of Commerce shares lost 5 percent as bad loans increased in second quarter.

Global markets remained in fourth gear as investors are convinced that Fed will stay the course and end the third round of bond buying but also wait a “considerable time “ before hiking short term rates. Hong Kong closed up almost 300 points while European markets were trading with almost 1 percent gains.

Meanwhile, the NDA government today submitted a list comprising 627 names of Indians having accounts in foreign banks to the Supreme Court. More information please visit this site

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