Key benchmark indices held firm in early afternoon trade. The barometer index, the S&P BSE Sensex remained past the psychological 27,000 level which it had attained in early trade. The Sensex was currently up 291.11 points or 1.08% at 27,199.93. The market breadth indicating the overall health of the market was strong with almost three gainers for every loser on BSE.
IT stocks advanced on positive jobs data from US. Infosys dropped amid volatility ahead of its Q3 December 2014 results tomorrow, 9 January 2015.
Foreign portfolio investors sold shares worth a net Rs 1073.18 crore yesterday, 7 January 2015, as per provisional data.
In overseas markets, Asian equity markets were higher today, 8 January 2015 as the fall in oil prices and concerns over Greece’s potential departure from the euro zone abated, while a positive finish on Wall Street overnight lifted trading sentiment.
In the foreign exchange market, the rupee edged higher against the dollar.
Brent crude futures recovered from the lowest level since April 2009 as investors weighed whether crude’s selloff was excessive amid signs of improving demand in the US.
At 12:15 IST, the S&P BSE Sensex was up 291.11 points or 1.08% at 27,199.93. The index surged 341.06 points at the day’s high of 27,249.88 in early trade, its highest level since 6 January 2015. The index rose 193.12 points at the day’s low of 27,101.94 in morning trade.
The CNX Nifty was up 94.90 points or 1.17% at 8,197. The index hit a high of 8,209.85 in intraday trade, its highest level since 6 January 2015. The index hit a low of 8,167.30 in intraday trade.
The BSE Mid-Cap index was up 164.53 points or 1.61% at 10,399.08. The BSE Small-Cap index was up 199.37 points or 1.81% at 11,188.36. Both these indices outperformed the Sensex.
The market breadth indicating the overall health of the market was strong with almost three gainers for every loser. On BSE, 1,870 shares advanced and 627 shares declined. A total of 83 shares were unchanged.
IT stocks advanced on positive jobs data in United States. Tech Mahindra (up 1.15%), Oracle Financial Services Software (up 0.97%), CMC (up 0.89%), TCS (up 0.76%), MindTree (up 0.71%), Wipro (up 0.53%), MphasiS (up 0.13%), and HCL Technologies (up 0.06%) edged higher.
United States is the world’s biggest outsourcing market for Indian IT firms.
Infosys fell 0.1% at Rs 1,962.85. The stock hit a high of Rs 1,996.85 and a low of Rs 1,951. Due to cross currency headwinds, analysts expects Infosys’ management to prune the company’s revenue growth guidance in dollar terms for the year ending 31 March 2015 (FY 2015) when the company announces its Q3 December 2014 results tomorrow, 9 January 2015. The IT major is widely expected to prune its FY 2015 dollar revenue growth to 7%-8%, from 7%-9%.
At the time of announcement of Q2 September 2014 results, Infosys had on 10 October 2014 retained its earlier guidance of 7% to 9% growth in revenue in dollar terms for FY 2015. At that time, the company had raised its revenue growth guidance in rupee terms due to rupee depreciation. The company had raised the revenue growth guidance for FY 2015 in rupee terms to 6.7%-8.7% from earlier 5.6%-7.6% at that time. The revised guidance was based on rupee dollar conversion rate of 61.
Bharat Electronics fell 1.77% at Rs 3,160. The stock hit a high of Rs 3,265 and a low of Rs 3,154.05. The company during market hours today, 8 January 2015 said it has inaugurated its modernised BEL Software Technology Centre (BSTC) of Navratna Defence PSU Bharat Electronics yesterday, 7 January 2015. BSTC is a part of the Central Development & Engineering Group of BEL-Bengaluru and is the software development centre of BEL, the company said in a statement.
On the macro front, data to be released in near future is expected to show industrial production growth remaining muted in November 2014 and consumer price inflation accelerating in December 2014. Industrial production is seen rising 1.6% in November 2014, as per the median estimate of a poll of economists carried out by Capital Market. The government will unveil industrial production data for November 2014 after trading hours on Monday, 12 January 2015. Industrial production had witnessed a surprise contraction of 4.2% in October 2014.
The rate of inflation based on the consumer price index (CPI) is seen accelerating to 5.4% in December 2014 from 4.4% in November 2014, as per the median estimate of a poll of economists carried out by Capital Market. The government will release the data on CPI inflation for December 2014 after trading hours on Monday, 12 January 2015.
The Reserve Bank of India (RBI) aims to limit consumer-price gains to 8% by January 2015 and 6% by January 2016. Over the longer term, the RBI aims to limit consumer-price gains to 4%, within a 2% band.
The rate of inflation based the wholesale price index (WPI) is projected at 0.5% for December 2014, as per the median estimate of a poll of economist carried out by Capital Market. WPI inflation stood at zero in November 2014. The government will release data on WPI for December 2014 at 12 noon on 14 January 2015.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 62.9675, compared with its close of 63.18 during the previous trading session.
Brent crude futures recovered from the lowest level since April 2009 as investors weighed whether crude’s selloff was excessive amid signs of improving demand in the US. Brent for February settlement was up 30 cents at $51.45 a barrel. The contract had advanced 5 cents to settle at $51.15 a barrel during the previous trading session.
Asian equity markets were higher today, 8 January 2015 as the fall in oil prices and concerns over Greece’s potential departure the euro zone abated, while a positive finish on Wall Street overnight lifted trading sentiment. Key indices in Hong Kong, Japan, Singapore, Taiwan, South Korea, and Indonesia were up 0.24% to 1.67%. In China, the Shanghai Composite was off 1.36%.
Trading in US index futures indicated that the Dow could gain 129 points at the opening bell today, 8 January 2015. US stocks surged yesterday, 7 January 2015, with the S&P 500 rebounding from a five-session dive, as US crude stopped a four-day skid and Germany left the door open to discussing options with Greece’s next government on its debt. Federal Reserve policymakers said they could begin raising interest rates before inflation starts to pick up, according to minutes of their meeting on 17 and 18 December 2014. However, the Fed officials added that “they would want to be reasonably confident that inflation will move back” toward the Fed’s annual 2% target “over time”.
US private sector employment gains accelerated in December as employers added 241,000 jobs, Automatic Data Processing Inc. reported yesterday, 7 January 2015. ADP revised November’s gain to 227,000 from a prior estimate of 208,000.
The US Labor Department reports monthly payroll data for December 2014 tomorrow, 9 January 2015.
In Europe, the uncertainties over the status of Greece including its possible exit from the eurozone are likely to persist until the early election in the country later this month. Greece is set to hold snap elections on 25 January 2015 after it failed to elect a new president in a third round of voting late last year. The Greek leftist opposition party Syriza leads opinion polls ahead of national elections on 25 January 2015. Syriza has demanded debt relief from the eurozone and promised to roll back the austerity and reform measures that the country has undertaken in exchange for the international bailout that the government negotiated in 2012.