Sensex ends marginally up after RBI holds rates steady, Nifty50 closes at 7,955

The BSE Sensex and NSE Nifty remained dull throughout the day on Tuesday and closed marginally in green after the Reserve Bank of India maintained key rates unchanged in its fifth bi-monthly monetary policy review. Sensex closed 23.74 points up at 26,169.41, while Nifty closed 19.65 points up at 7954.90.

In the 50-share index, Vedanta, Tata Steel, BPCL, Coal India and Hindalco gained between 3.40 per cent and 5.20 per cent. On the other hand, Bharti Airtel, Adani Ports, Axis Bank, GAIL and Maruti Suzuki slid between 1.30 per cent and 3.20 per cent.

Nifty 50 – Top 5 Gainers & Losers

Among the sectoral indices on the Bombay Stock Exchange (BSE), the BSE Auto index plunged 0.58 per cent, followed by BSE Consumer Durables (down 0.34 per cent), BSE Bankex (down 0.29 per cent) and BSE TECk (down 0.22 per cent). The BSE Metal index and BSE Healthcare index gained 3.18 per cent and 1.07 per cent, respectively.

Gaurav Jain, Director, Hem Securities, said, “Indices continued to be lacklustre and traded in a narrow range on an eventful day. The RBI kept its key rates unchanged in its fifth bi-monthly monetary policy review and has raised concerns on inflation. Further, weak HSBC Manufacturing PMI of India and continued sell-off by foreign portfolio investors affected the sentiment of the street.”

The Reserve Bank, which has lowered interest rate by 125 basis points or 1.25 per cent this year, including a larger-than-expected 50 basis points cut at the last monetary policy review in late September, left the benchmark lending rate (repo) at 6.75 per cent.

Arundhati Bhattacharya, chairman, SBI on 5th Bi-Monthly Monetary Policy said, “RBI’s announcement in the RBI Fifth Bi-Monthly monetary policy decision to keep the repo rate unchanged is on expected lines. Today’s policy undertone has leaned towards the neutral-to-dovish side. Governor’s indication of being accommodative policy sends a positive signal for Indian economy. The guidelines on the base rate calculation based on Marginal Cost of funds will be watched and appropriate actions will be taken on the same. Overall with CAD and inflation targets well within control and Q2 GDP at 7.4%, the Indian economy seems headed for a good financial year ahead.”

Traders took some encouragement with global rating agency Moody’s Investors Service stating that the Reserve Bank of India’s efforts in bringing down inflation is credit positive for the country and hoped that the central bank will continue to remain vigilant in sticking to the target level. Sentiment was also boosted with data released late on Monday showing the economy grew at a faster clip of 7.4 per cent in July-September, mainly on the back of pick up in manufacturing activities.

However, the gains were capped with manufacturing sector growing at its slowest pace in 25 months in November on sluggish pace of new business orders. Manufacturing PMI fell to a 25-month low of 50.3 in November, from 50.7 in October.

The auto sector remained in limelight on announcing the monthly sales numbers, Eicher Motors’ motorcycle division reported a 48 per cent jump in total sales in November, Ashok Leyland, reported an increase of 16 per cent in sales, Maruti Suzuki India, registered a rise of 9.7 per cent in its total car sales, while M&M reported 21 per cent growth in November sales.

The PSU oil marketing companies too remained buzzing, after the petrol and diesel prices were reduced in the fortnightly review. ATF price was cut by a marginal 1.2 per cent, the third straight monthly reduction since October. Simultaneously, oil firms have also raised the prices of non-subsidised LPG, by Rs 61.50 per 14.2-kg bottle. BPCL and IOC gained around 2.81 per cent and 2.90 per cent respectively, while HPCL gained 0.70 per cent.

On the global front, after a lackluster trade in US markets, the Asian markets showed an enthusiastic performance with all the major indices in the region ending in green, rebounding from a two-week low after currencies advanced for the first time in five days against the US dollar. The European markets made a cautious start after the Swiss GDP unexpectedly stagnated in third quarter; output was unchanged in the three months through September, after increasing of 0.2 per cent in the prior period.

—————————————————————————————————————————

Markets through the day

3.30 pm: Sensex closed 23.74 points up at 26,169.41, while Nifty settled 19.65 points up at 7,954.90.

2.58 pm: Mahindra & Mahindra (M&M), India’s leading SUV manufacturer, has reported its auto sales numbers which stood at 41,590 units during November 2015 as against 34,292 units during November 2014, registering a growth of 21%. The Passenger Vehicles segment (which includes UVs, Cars and Vans) sold 19,662 units in November 2015 as against 14,473 units during November 2014, up by 36 per cent. Shares of M&M were trading 0.25 per cent down at Rs 1,363.90.

2.35 pm: Shares of Dena Bank surged over 10 per cent after the bank informed BSE that a meeting of the Board of Directors of the Bank will be held on December 03, 2015, inter alia, to consider the following businesses:

• To raise AT1 capital upto an amount of Rs 1,500 cr in one or more tranche, in one or more instruments;
• To raise Tier 2 capital upto an amount of Rs 1,000 cr in one or more tranche, in one or more instruments;
• To raise Equity Capital of the Bank by diluting GOI holding upto 52 per cent, on obtaining necessary approval from GOI.

Dena Bank was trading 10.20 per cent up at Rs 46.45.

2.03 pm: Interest-rate sensitive bank, realty and auto stocks were trading on a mixed note as the Reserve Bank left the key interest rate unchanged. Sensex was  trading 4.48 points at 26,150.15. Similarly, Nifty was up 3.85 points at 7,939.10.

1.33 pm: Shares of Jubilant Life Sciences surged as much as 9.75 per cent after the company informed stock exchanges that it has received Abbreviated New Drug Application (ANDA) final approval from the US Food and Drug Administration (US FDA) for Paroxetine Tablets USP, 10 mg, 20 mg, 30 mg and 40 mg, the generic version of Paxil Tablets, 10 mg, 20 mg, 30 mg, and 40 mg® (of Apotex), which is used as an antidepressant. Sensex was marginally up 20 points at 26,166.

12.57 pm: Steel Strips Wheels (SSWL) share price gained as much as 6.83 per cent on Tuesday after the company informed stock exchanges that it has secured an export order from Jaguar Land Rover (JLR). Sensex was up 37 points at  26,183

12.39 pm: Ashok Leyland reported 16 per cent rise in its total sales figures in November. The company sold 8971 units in November 2015 against 7732 units in the same month last year. Shares of Ashok Leyland were trading 0.63 per cent down at Rs 93.90.

12.21 pm: Sensex was up 44 points at 26,190. Nifty was up 23.15 points at 7,958.40. Tree House Education & Accessories share price hit upper circuit on Tuesday after the company updated BSE that it has successfully received all amounts related to preschools and franchise operations that were outstanding as on 30 September 2015. The share price of the company surged 9.99 per cent to Rs 167.30.

12.05 pm: Jet fuel or ATF price was cut on Tuesday by a marginal 1.2 per cent, the third reduction in as many months. Aviation Turbine Fuel (ATF) price in Delhi was cut by Rs 526.2 per kilolitre (kl), or 1.2 per cent, to Rs 44,320.32 per kl from Rs 44,846.82 per kl, oil companies announced on Tuesday. This is the third straight monthly reduction since October. In three reduction, ATF price has been cut by Rs 2,914.98 per kl. Shares of aviation stocks Jet Airways and SpiceJet were trading 1.34 per cent and 0.59 per cent up at Rs 521.80 and Rs 68.10. Indigo shares were trading 0.31 per cent down at Rs 1,106.

11.51 am: On the status quo by RBI, Deepak Joshi, president and chief business officer, Religare Housing Development Finance Corporation, said, “In the backdrop of 125 basis points (bps) reduction in benchmark rates earlier and current level of retail inflation, further rate cuts were not expected this time. However, this will not be the end of declining rate regime, this is just a beginning. In order to boost economy and targeted GDP growth, reasonable transmission of past rate cuts need to see the light. Also move to work on a methodology for determining the base rate based on the marginal cost of funds and linking small savings interest rates to market interest rates, which all banks will have to follow is a big welcome as it further help transmission of policy rates into lending rates.”

11.46 am: In scrip specific development, shares of Shreyas Shipping & Logistics gained as much as 2.28 per cent after the company has received its board’s approval to enter into Memorandum of Understanding (MoU) for the formation of a Joint Venture Company (JVC) with Suzue Corporation, Japan for exploring business opportunities in the logistics space within India and Japan.

11.26 am: Among the major losers in Nifty50 index, Bharti Airtel, Maruti Suzuki, Bank of Baroda, Asian Paints and Adani Ports were down 2.26 per cent, 0.82 per cent, 0.81 per cent, 0.75 per cent and 0.52 per cent, respectively. 

11.23 am: Benchmark indices turned flat after the RBI maintained status quo. Senses was marginally up 11 points at 26,157, while Nifty was up 8 points at 7,943.

11.13 am: Rate sensitives, BSE Auto index was down 0.24 per cent, while BSE Bankex and BSE Realty index were up 0.06 per cent and 0.14 per cent, respectively.

11.03 am: RBI kept economic growth projection unchanged at 7.4 per cent in FY16. Sensex was up 74 points 26,220. Nifty was up 35.15 points at 7,970.40. 

11.00 am: In line with expectations, the Reserve Bank of India (RBI) on Tuesday maintained statu quo on key policy rates, keeping repo rate unchanged at 6.75 per cent. RBI also kept CRR unchanged at 4 per cent. Sensex was up 37.30 points at 26,182. Nifty was up 22 points at 7,957.

According to RBI, the implementation of the Pay Commission proposals, and its effect on wages and rents, will also be a factor in the Reserve Bank’s future deliberations, though its direct effect on aggregate demand is likely to be offset by appropriate budgetary tightening as the Government stays on the fiscal consolidation path. For full text click here:

Murthy Nagarajan, head, fixed income, Quantum AMC, said, “As expected, a status quo policy, with the RBI reiterating that they remain accommodative and are waiting for further room to open up. We hold our view that the next rate cut would be possible only post the budget. With the RBI highlighting the impact of pay commission on the fiscal numbers, it would want to wait and see the markets response to the government’s ability to meet the 3.5 per cent FD target. We like government bonds at these levels and continue to maintain our long duration stance with an expectation of term spread compression in the months to come.”

10.43 am: Diagnostic chain Dr Lal PathLabs on Monday fixed price band at Rs 540-550 for its initial public offer (IPO) which will hit the capital market on December 8.

10.40 am: Eicher Motors reported 48 per cent rise in its November sales figures. The company sold 40,769 units in November 2015 against 27,542 units in November 2014. The share price of Eicher Motors was trading 1.07 per cent down at 16,545. The BSE Auto index was down 0.16 per cent at 18,933.60.

10.38 am: Karthik Rangappa, vice president, education and research, Zerodha, said, “Markets have been trading in a narrow range as it hinges upon the RBI monetary policy, which is due today. We would advice traders with large risk appetite to initiate a short straddle on 7,900 Nifty options at market open and squaring off the position right after the RBI policy announcement is made.”

10.35 am: Shares of Maruti Suzuki were trading 0.04 per cent down at Rs 4,575. The company on Tuesday announced its sales figures for the month of November. Maruti Suzuki India, country’s largest car maker, has registered a rise of 9.7 per cent in its total car sales (Domestic + Export) for the month of November 2015 at 12,0824 units, as against 1,10,147 units in the same month last year. The company’s domestic sales rose by 10.6 per cent in November 2015 at 1,10,599 units, as against 1,00,024 units in corresponding month last year.

10.27 am: After falling 2 per cent on Monday, shares of Bharti Airtel fell further on Tuesday. In the morning trade, the scrip was trading 2.17 per cent down at Rs 327.25. Shares of the telecom company are falling after it announced investment of Rs 60,000 crore in the next three years to upgrade networks and improve quality of services as competition intensifies in the sector.

10.17 am: YES Bank signed an agreement with the Overseas Private Investment Corporation, the US Government’s Development Finance Institution, for debt financing of $245 million to increase lending to micro, small and medium enterprises in India. The share price of the bank was trading 0.03 per cent up at Rs 766.70.

10.05 am: Sensex was up 47 points at 26,192. According to market experts, sentiments were lifted after India’s GDP growth accelerated to 7.4 per cent in the July-September quarter from 7 per cent in the previous quarter. Besides, a firm trend at other Asian markets boosted trading sentiments.

10.00 am: Shares of Tata Power gained 0.75 per cent in the morning trade after Maithon Power, a 74 per cent Joint Venture (JV) of Tata Power, issued and allotted senior, non-cumulative, redeemable, listed, rated, secured non-convertible Debentures (NCDs) for an amount of Rs 500 crore on private placement basis. The NCDs have been rated AA-(with stable outlook) by CRISIL. The NCDs carry a floating rate of interest linked to base rate published by HDFC Bank. These NCDs have been issued on a private placement basis through a private placement offer letter cum information memorandum.

9.53 am: Meanwhile, Lux Industries shares listed on the National Stock Exchange at Rs 3342.05.

9.47 am: Rupee appreciated by 16 paise to 66.51 against the dollar in early trade on increased selling of the American currency by exporters and banks amid India’s economic growth accelerating to 7.4 per
cent in the July-September quarter.

9.22 am: In the 50-share index, Asian Paints and Bharti Airtel were trading 2.23 per cent and 2.15 per cent down in the early trade. On the other hand, Power Grid and IndusInd Bank were up 2.02 per cent and 1.69 per cent, respectively. 

9.17 am: Sensex was up 73.52 points 26,219.19. Nifty was up 32.55 points at 7,967. State-owned trading firm MMTC said it will invest about Rs 6,000 crore to double the capacity of Neelachal Ispat Nigam (NINL) in the next four years. Shares of MMTC were trading 0.33 per cent up at Rs 45.55 in the early trade.

9.15 am: The BSE Sensex and NSE Nifty50 index opened on a positive note on Tuesday after India’s economy grew by 7.4 per cent in July-September, outpacing China to become the fastest growing major economy. Sensex opened 55.60 points up at 26,201.27, while Nifty index opened 22.90 points up at 7,958.15.

The signs of recovery in the GDP, from a growth rate of 7 per cent in the previous quarter ended June 30, follows a series of rate cuts announced by the RBI in recent months and bolstered the case for the central bank to hold onto its rate at its scheduled monetary policy review meeting on Tuesday.

Other Asian market were also trading higher, shrugging off a Chinese factory survey that did little to ease persistent concerns about cooling growth in the economy, while a private survey showed a hint of stabilisation.

Back home, equity markets showed a volatile trade on Monday, though the major bourses managed to keep their head in green for most part of the day and closed on a flat note. The BSE Sensex ended 17.47 points up at 26145.67, while Nifty50 index closed 7.45 points down at 7935.25.

The FIIs as per Monday’s data were net sellers in equity and in debt segments both, according to data released by the NSDL.

In equity segment, the gross buying was of Rs 2,820.14 crore against gross sell of Rs 3,278.53 crore. Thus, FIIs stood as net sellers of Rs 458.39 crore in equities.

In the debt segment, the gross purchase was of Rs 355.83 crore with gross sales of Rs 900.62 crore. Thus, FIIs stood as net sellers of Rs 544.79 crore in debt.

(With inputs from agencies)