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14 July 2016
I had mentioned in Wednesday’s closing report
that Nifty, Sensex might struggle to head higher. The major indices of the
Indian stock markets rallied to close with gains of about 0.50% over
Wednesday’s close. The trends of the major indices in the course of Thursday’s
trading are given in the table below: The Total Investment
& Insurance Solutions
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Major Indices(The Total Investment & Insurance
Solutions)
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Disappointing macro-economic data and mixed
global cues subdued the equity markets on Thursday. Consequently, both the
indices traded on a flat note. Healthy buying was witnessed in banking,
consumer durables and capital goods sectors, whereas stocks of information
technology (IT) faced selling pressure. The NSE Nifty market breadth was skewed
in favour of the bulls -- with 39 advances and 12 declines. The BSE market
breadth was tilted in favour of the bulls -- with 1,533 advances and 1,016
declines. The Total Investment & Insurance
Solutions
Initially on Thursday, the equity indices
opened on a flat note, triggered by mixed global cues and lower crude oil
prices. However, disappointing macro-economic data released during the day
weighed heavy on investors' sentiments. The official data disclosed an annual
wholesale inflation to a 20-month high of 1.62% for June from 0.79% in May due
to a rise in food prices. Investors were also seen cautious ahead of the
upcoming quarterly earnings season. IT (information technology) major Infosys
is expected to be the first bluechip firm to come out with its results on July
15. The Total Investment & Insurance Solutions
British oil firm Cairn Energy Plc, battling
payment of dues in the retrospective taxation case with the Indian government,
has in turn slapped a notice demanding a compensation of $5.6 billion for not
giving it a "fair and equitable treatment". Cairn Energy filed the
compensation notice with the international arbitration panel, saying the Indian
government failed to give a fair and equitable treatment to investments in the
country. The company said it suffered a loss in the valuation of its 9.8%
holding of Cairn India owing to the retrospective taxation case that the income
tax department initiated against it in 2014. The compensation notice comes against
the backdrop of the retrospective tax demand of Rs29,000 crore from the Indian
tax department that Cairn has received, on alleged capital gains the company
made in a 2006 reorganisation of its India business. The course of the case
will be eagerly watched by potential FDI investors for evaluating ease of doing
business in India.
Ballooning food prices pushed up India's
annual wholesale inflation to a 20-month high of 1.62% for June from 0.79% in
May, according to official data released on Thursday. This kept inflation in
the positive domain for the third month after 17 months in the negative.
Inflation is a very important factor in RBI’s decision making on interest rates
in the banking sector. This in turn affects the growth in values of major stock
market indices in India. It is too early to anticipate RBI policy right now on
interest rates. The Total Investment & Insurance
Solutions
India's Road Transport, Highways and Shipping
Minister Nitin Gadkari during his visit to the world's financial capital has
been pitching the investment potential in India's infrastructure as it embarks
on its ambitious "Move in India" programme and opens its roads and
ports to foreign cooperation. In a series of meetings with business leaders and
investment professionals, organised here on Tuesday and Wednesday by the
Indo-American Chamber of Commerce and the Business Council for International
Understanding, J.P. Morgan and Goldman Sachs, Gadkari said he hoped that the
multi-billion transportation plans could add two percentage points to India's
7.6% GDP growth by creating a world-class infrastructure. He invited US
investors to participate in the highways development programme that envisages a
total investment of $150 billion over the next five years. A range of projects
exists to suit each investor's risk and return expectations, he said.
Government policy is important for attracting FDI in this sector and could
affect investor sentiments in the stock markets.
US stocks closed mixed on Wednesday, with the
Dow Jones Industrial Average and the S&P 500 eclipsing Tuesday's closing
records, as investors digested the newly-released Federal Reserve's Beige Book.
According to the Fed Beige Book released in the afternoon, reports from the 12
Federal Reserve districts indicated that economic activity has expanded in nine
of the districts since the previous Beige Book report and contacts in Boston
were described as upbeat. Analysts thought that the Beige Book showed US
economy was growing steadily, but not at a pace where the Fed would feel
comfortable raising rates in the near future.
The top gainers and top losers of the major
indices are given in the table below:
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Top Gainer(The Total Investment
& Insurance Solutions)
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The closing values of the major Asian indices
are given in the table below: The Total Investment & Insurance
Solutions
 |
Asian Indices(The Total Investment
& Insurance Solutions)
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