We had mentioned in last week’s closing report that Nifty, Sensex might rally if weekly lows hold. The major indices of the Indian stock markets rallied strongly only on Monday. On the remaining days of the week, the indices failed to continue on the upward trajectory. It appeared that the momentum of the initial rally had been lost through the week. Trading volumes were high through the week. The trends of the major indices in the course of the week’s trading are given in the table below:
Positive global cues lifted the Indian equity markets on Monday. Buying was witnessed in automobile, capital goods and banking stocks. The BSE market breadth was skewed in favour of the bulls - with 2,228 advances and 660 declines. On the NSE, there were 1,316 advances, 155 declines and 42 unchanged.
Two and three wheeler major Bajaj Auto on Monday reported a decline of 2% in its total sales for September. According to the company, its total sales during the month under review stood at 376,765 units from an off-take of 384,400 units during the corresponding month of 2015. However, total domestic sales in September were up 21% to 255,592 units from 210,599 units sold during the like month of last year. The overall exports during the last month declined by 30% to 121,173 units from 173,801 units shipped out during the corresponding month of 2015. The company's total motorcycle sales during the month under review increased by one per cent to 331,976 units from 330,228 units sold in the like month of last year. In contrast, the overall commercial vehicle sales declined by 17% to 44,789 units from 54,172 units sold during September 2015. Bajaj Auto shares closed at Rs2,875.30, up 1.52% on the BSE.
Reduction in a key lending rate, coupled with short covering and value buying, pushed up the Indian equity markets on Tuesday. The key indices which opened on a higher note following positive cues from Asian markets, held on to their gains after the Reserve Bank of India (RBI) announced a 25 basis points cut in one of its key lending rates. Buying was witnessed in interest-sensitive stocks in oil and gas, banking and metals. The BSE market breadth was tilted in favour of the bulls -- with 1,689 advances and 1,156 declines. On the NSE, there were 826 advances, 615 declines and 62 unchanged.
The Monetary Policy Committee of the Reserve Bank of India (RBI) cut a key lending rate by 25 basis points on Tuesday at the conclusion of its first meeting over two days, bringing much relief to commercial banks and India Inc. With the decision, the repurchase rate, or the short-term lending rate charged by the central bank on borrowings by commercial banks, stands lowered to 6.25%. The reverse repurchase rate also automatically stands lowered to 5.75%. This was the first meeting of the new policy panel, constituted by the government with the primary mandate to ensure a retail inflation of 4%, plus or minus a band of two percentage points. The panel said in a statement that the decision taken on Tuesday was consistent with an accommodative stance, with the objective of achieving the inflation target. All six members of the panel, chaired by RBI Governor Urjit Patel, voted in favour of the monetary policy decisions -- the minutes of which will be released on October 18. The markets responded to the decision with a spike in key indices.
Negative global indices, coupled with profit booking and lower than expected macro-data, dragged the Indian equity markets during the mid-afternoon trade session on Wednesday. Selling pressure was witnessed in banking, IT and oil and gas stocks. On the BSE, there were 1,739 advances, 1,142 declines and 123 unchanged. On the NSE, there were 841 advances, 598 declines and 43 unchanged. Investors were seen reluctant to chase prices after several days of rise, pointed out market analysts. Negative European markets and disappointing Services PMI figure, too, dragged the key indices lower.
Anil Ambani-led Reliance Infrastructure on Wednesday said it is selling its entire transmission assets to Adani Transmission. The deal size was not divulged, but banking sources estimated it at over Rs 2,000 crore. Reliance Infrastructure owns the country's first 100% private sector transmission project -- the Western Region System Strengthening Scheme -- in Maharashtra, Gujarat, Madhya Pradesh and Karnataka. Reliance Infrastructure also owns 74 per cent in Parbati Koldam Transmission located in Himachal Pradesh and Punjab in a joint venture with Power Grid Corp. All three transmission projects have been completed and are revenue-generating, the company said in a statement. "The entire sale proceeds from the transaction will be utilized for debt reduction," the company said. "The transaction is in line with the strategic plan of monetizing non-core business and focus on growth areas like defence and engineering, procurement and construction business."
Negative global markets, coupled with lower crude oil prices and a weak rupee, dented the equity markets during the mid-afternoon trade session on Thursday. Selling pressure was witnessed in automobile, banking and IT (information technology) stocks. The BSE market breadth was tilted in favour of the bulls -- with 1,366 advances and 1,506 declines. On the NSE, there were 658 advances, 960 declines and 255 unchanged.
Initially on Thursday, the benchmark indices opened on a higher note in sync with their Asian peers. However, the global markets, especially the European markets, remained subdued over speculation on curtailment of stimulus measures by the European Central Bank (ECB). Besides, caution prevailed ahead of key US macro-data on jobs to be released on Friday. In addition, lower crude oil prices, profit booking and consolidation added to the downward trajectory.
Three public sector banks -- Indian Overseas Bank (IOB), Bank of India and Syndicate Bank -- on Wednesday announced reduction in their marginal cost of funds-based lending rate (MCLR) for various tenors. Indian Overseas Bank, in a statement, said its MCLR for one year was reduced to 9.50% from 9.55% with effect from October 1. Similarly, Syndicate Bank said it cut its MCLR for one year to 9.45% from 9.55% effective from October 7. On its part, Bank of India said its one year MCLR was 9.35% effective from October 7.
Negative global indices and profit booking pulled the Indian equity markets lower on Friday. The key indices traded on a flat-to-negative note during the session, as selling pressure was witnessed in IT (information technology), oil and gas, and capital goods stocks. The BSE market breadth was tilted in favour of the bears -- with 1,387 declines and 1,315 advances. On the NSE, there were 783 advances, 835 declines and 257 unchanged. On Friday, the major indices of the Indian stock markets closed around 0.15% lower than Thursday’s close. To add to the stock market investors’ caution, U.S. employment growth was likely to have picked up in September, putting pressure on the Federal Reserve to raise interest rates and signalling that steam could be building in the economy ahead of America's presidential election.