Indian markets ended in the negative territory as traders booked profits ahead of January series F&O expiry. Rate sensitive sectors like banks and realty were under pressure after Reserve Bank of India raised repo rate and reverse repo rate by 25 basis points to 6.25 per cent and to 5.5 per cent respectively while the CRR was left unchanged.
The GDP growth forecast has been retained at 8.5 per cent with upward bias while WPI inflation forecast has been raised to 7 per cent for FY11.
“RBI has maintained that although inflationary tendencies are submissive in the advanced economies, inflationary pressures in emerging market economies have intensified due to sharp increases in food, energy and commodity prices.
Going forward, RBI has revised its year end inflation target from 5.5% to 7% and has also indicated further measures will be taken to control inflation in the coming period. We expect that this will have a negative impact on the banking sector and the sectors related to it which includes auto, IT, real estate and infrastructure in the near term,” said Nirmal Bang report.
Bombay Stock Exchange’s Sensex closed at 18969.45, down 181.83 points or 0.95 per cent. The 30-share index touched a high of 19340.99 and low of 18949.44 intraday.
National Stock Exchange’s Nifty ended at 5687.40, down 55.85 points or 0.97 per cent. The 50-share index touched a low of 5680.65 and high of 5801 in today’s trade.
BSE Midcap Index was down 0.41 per cent and BSE Smallcap Index moved 0.35 per cent lower.
Amongst the sectoral indices BSE Bankex was down 2.34 per cent BSE Realty Index was slipped 1.20 per cent and BSE Auto Index declined 1.05 per cent.
Nifty losers included Hindustan Unilever (-5.69%), ICICI Bank (-4.09%), HDFC Bank (-2.96%), Dr Reddy’s Laboratories (-2.88%) and M&M (-2.73%).
Hindustan Unilever standalone net profit slipped to Rs 637.51 crores against Rs 649.11 crores in the same quarter a year ago. Net sales rose to Rs 5027.01 crores from Rs 4504.26 crores.
BPCL (4.79%), GAIL (3.11%), Siemens (2.86%), NTPC (2.21%) and Hero Honda (2.05%) were amongst the top gainers.
Market breadth was negative on the NSE with 1688 losers as compared to 1211 gainers.
Tuesday, January 25, 2011
Nifty ends below 5700 on hike in RBI key rates
Monday, November 15, 2010
'Rs 50,000 cr liquidity crunch in the economy'
Worried over liquidity crunch in the economy estimated at around Rs 50,000 crore, the RBI on Saturday said the situation has worsened and it was taking measures to ease it.
"...during the last couple of weeks the number (deficit) has been clearly above that. That number was clearly about Rs 50,000 crore," RBI Deputy Governor Subir Gokarn said.
The RBI's policy statement on November 2 had tried to explain a comfortable liquidity band, which is plus or minus one per cent of the net demand and time liabilities (NDTL), Gokarn said.
The economy has been experiencing liquidity shortfall due to a spurt in festive demand coupled with an over Rs 20,000 crore absorption on account of the recent share sale offer of public sector undertaking Coal India and Power Grid Corporation (PGCIL).
"We moved to a deficit liquidity situation in end May or early June. But in the last few weeks it has gone beyond what we think is a normal or a positive liquidity deficit," Gokarn said in his address at a CII event here.
Stating that some deficit in liquidity is desirable, the RBI official, however, observed that in the last few weeks the liquidity situation has gone beyond the comfort zone.
To ease the pressure on liquidity, the RBI earlier this week announced special measures.
Under this banks would be able to avail more funds under the liquidity adjustment facility (LAF) for up to one per cent more on their deposits.
Gokarn pointed out that since the past few weeks, RBI has been taking measures to infuse liquidity into the system.
"During the past few weeks, we have relaxed the statutory liquidity ratio limits, did some open market operations and restructured the buyback and auctions of government bonds, to handle short-term liquidity problems, he said"
Liquidity deficit is desirable from the monetary policy transmission point of view, he said, adding the economy had earlier moved into a surplus liquidity mode.
This had been after the injection of money in the post-slowdown monetary measures adopted by the central bank and fiscal steps initiated by the government.
"An excessive liquidity deficit tends to bring about volatility in the short-term rates...that makes for some possible disruption for banking activities and credit flows," the RBI Deputy Governor said.
Bankers have also been saying that liquidity has been tight in the system but this is the first time a senior central bank official has flagged it as an issue of concern. For the past few weeks, the call money rates have been ruling at historic highs.
Gokarn, however, said, "the process of policy normalisation" is almost complete. There will not be further hikes in key rates in the immediate future, and "growth and inflation" will be the main factors while RBI firms up its responses.
It may be recalled that though food inflation has been on a southward spiral for the past one month, it is still at an elevated level of 12.30 per cent for the week ended October 30.
On inflation, Gokarn said it is still a mixed bag as food inflation has been waning.
"...during the last couple of weeks the number (deficit) has been clearly above that. That number was clearly about Rs 50,000 crore," RBI Deputy Governor Subir Gokarn said.
The RBI's policy statement on November 2 had tried to explain a comfortable liquidity band, which is plus or minus one per cent of the net demand and time liabilities (NDTL), Gokarn said.
The economy has been experiencing liquidity shortfall due to a spurt in festive demand coupled with an over Rs 20,000 crore absorption on account of the recent share sale offer of public sector undertaking Coal India and Power Grid Corporation (PGCIL).
"We moved to a deficit liquidity situation in end May or early June. But in the last few weeks it has gone beyond what we think is a normal or a positive liquidity deficit," Gokarn said in his address at a CII event here.
Stating that some deficit in liquidity is desirable, the RBI official, however, observed that in the last few weeks the liquidity situation has gone beyond the comfort zone.
To ease the pressure on liquidity, the RBI earlier this week announced special measures.
Under this banks would be able to avail more funds under the liquidity adjustment facility (LAF) for up to one per cent more on their deposits.
Gokarn pointed out that since the past few weeks, RBI has been taking measures to infuse liquidity into the system.
"During the past few weeks, we have relaxed the statutory liquidity ratio limits, did some open market operations and restructured the buyback and auctions of government bonds, to handle short-term liquidity problems, he said"
Liquidity deficit is desirable from the monetary policy transmission point of view, he said, adding the economy had earlier moved into a surplus liquidity mode.
This had been after the injection of money in the post-slowdown monetary measures adopted by the central bank and fiscal steps initiated by the government.
"An excessive liquidity deficit tends to bring about volatility in the short-term rates...that makes for some possible disruption for banking activities and credit flows," the RBI Deputy Governor said.
Bankers have also been saying that liquidity has been tight in the system but this is the first time a senior central bank official has flagged it as an issue of concern. For the past few weeks, the call money rates have been ruling at historic highs.
Gokarn, however, said, "the process of policy normalisation" is almost complete. There will not be further hikes in key rates in the immediate future, and "growth and inflation" will be the main factors while RBI firms up its responses.
It may be recalled that though food inflation has been on a southward spiral for the past one month, it is still at an elevated level of 12.30 per cent for the week ended October 30.
On inflation, Gokarn said it is still a mixed bag as food inflation has been waning.
Friday, November 5, 2010
Nifty climbs past 6300; JPAsso,M&M,Hindalco gain
Equities began Mahurat trading, first day of trade of Samvat 2067 (first day of Hindu calendar), on a bullish note as investors took positions across the board. All the sectoral indices were in the green led by auto, healthcare and banks while IT stocks were modestly higher.
At 6.30 pm; Bombay Stock Exchange’s Sensex was at 21018.98, up 125.30 points or 0.60 per cent. The index hit a high of 21108.64 and low of 21014.46 in trade so far.
National Stock Exchange’s Nifty was at 6313.65, up 31.85 points or 0.51 per cent. The broader index touched high of 6338.50 and low of 6310 in early trade.
BSE Midcap Index was up 0.81 per cent and BSE Smallcap Index gained 1.43 per cent.
Amongst the sectoral indices, BSE Auto Index jumped 0.85 per cent, BSE Healthcare Index rose 0.78 per cent and BSE Bankex advanced 0.76 per cent.
Jaiprakash Associates (4.32%), M&M (1.82 %), Hindalco Industries (1.72%), SBI (1.51%) and Sun Pharma (1.18%) were the top Nifty gainers.
Losers included Jindal Steel (-0.29%), Reliance Communications (-0.14%),HDFC (-0.10%), Suzlon Energy (-0.09%) and Ambuja Cement (-0.03%).
Shares of Coal India continued to soar higher on the back of sustained demand from investors. The stock was at Rs 352.25, up Rs 9.70 or 2.83 per cent. It touched intraday high of Rs 356.50 and low of Rs 343.
At 6.30 pm; Bombay Stock Exchange’s Sensex was at 21018.98, up 125.30 points or 0.60 per cent. The index hit a high of 21108.64 and low of 21014.46 in trade so far.
National Stock Exchange’s Nifty was at 6313.65, up 31.85 points or 0.51 per cent. The broader index touched high of 6338.50 and low of 6310 in early trade.
BSE Midcap Index was up 0.81 per cent and BSE Smallcap Index gained 1.43 per cent.
Amongst the sectoral indices, BSE Auto Index jumped 0.85 per cent, BSE Healthcare Index rose 0.78 per cent and BSE Bankex advanced 0.76 per cent.
Jaiprakash Associates (4.32%), M&M (1.82 %), Hindalco Industries (1.72%), SBI (1.51%) and Sun Pharma (1.18%) were the top Nifty gainers.
Losers included Jindal Steel (-0.29%), Reliance Communications (-0.14%),HDFC (-0.10%), Suzlon Energy (-0.09%) and Ambuja Cement (-0.03%).
Shares of Coal India continued to soar higher on the back of sustained demand from investors. The stock was at Rs 352.25, up Rs 9.70 or 2.83 per cent. It touched intraday high of Rs 356.50 and low of Rs 343.
Subscribe to:
Posts (Atom)