Markets as on 4/6/14

Views on markets today

- Benchmark share indices ended at record closing highs as the cut in statutory liquidity ratio, announced by the Reserve Bank of India at its policy meet, will help inject liquidity, paving the way for credit growth revival.

The 30-share Sensex ended higher by 174 points at 24,859 and the 50-share Nifty closed higher by 53 points at 7,316. The Sensex and Nifty touched an intra-day high of 24,892 and 7,425 levels, respectively.

- Twelve bank shares fell by 0.17% to 2.02%, in the late morning trade, on BSE after the Reserve Bank of India left key interest rates unchanged at the monetary policy review yesterday.

Bank of India (down 2.02%), IndusInd Bank (down 1.86%), IDBI Bank (down 1.68%), Canara Bank (down 1.54%), Kotak Mahindra Bank (down 1.36%), Union Bank of India (down 1.28%), Punjab National Bank (down 1.11%), Bank of Baroda (down 0.99%), Yes Bank (down 0.72%), ICICI Bank (down 0.69%), HDFC Bank (down 0.44%) and Federal Bank (down 0.17%), edged lower.

- Nine metal shares rose by 0.37% to 6.28%, in the intraday trade, on BSE, extending Monday's rally triggered by strong Chinese data.

Sesa Sterlite (up 6.28%), Hindustan Zinc (up 4.49%), Tata Steel (up 3.99%), JSW Steel (up 3.81%), Jindal Steel & Power (up 2.76%), Steel Authority of India (Sail) (up 2.67%), Hindalco Industries (up 2.60%), Bhushan Steel (up 1.30%) and NMDC (up 0.37%), edged higher.

- Tata Motors closed 0.15% down at Rs 420.45 on BSE after the company said its total sales (including exports) of Tata commercial and passenger vehicles fell 24% to 37,525 vehicles in May, 2014 over May, 2013.

- Among the 12 BSE Sectoral indices, - indices closed in positive while 4 indices ended the day in negative. Top Gainers: BSE Metal up by 5.06% and BSE Realty by 3.15%. Top Losers: BSE FMCG down by 0.75% and BSE Healthcare by 0.50%.

Market breadth was sharply positive at ~1.71 as investors bought large cap stocks. On provisional basis, FII's bought Rs 5.75bn worth of Indian equities and DII's bought Rs 0.99bn worth of equities.

Economic and Corporate Developments

- The Reserve Bank of India (RBI) in the bi-monthly monetary policy review on Tuesday kept the repo rate unchanged at 8% as per the street's expectations. The Cash Reserve Ratio (CRR) was also unchanged at 4% of net demand and time liabilities (NDTL).

However, the Statutory Liquidity Ratio (SLR) was reduced by 50 basis points to 22.5% of banks NDTL with effect from the fortnight beginning June 14, 2014. Besides, RBI also reduced the liquidity provided under the export credit refinance (ECR) facility from 50% of eligible export credit outstanding to 32% with immediate effect. The SLR cut will be effective June 14, 2014.

Buzzing Stocks

- Zee Entertainment Enterprises closed 2.13% up at Rs 271.05 on BSE after the Reserve Bank of India allowed foreign institutional investors to purchase up to 100% of the paid-up capital of the company.

- Ashok Leyland closed 1.67% up at Rs 33.40 on BSE, even after the company said its total sales fell 9% to 6,632 units in May, 2014 over May, 2013.

- ITC closed 1.16% down at Rs 333.45 on BSE after turning ex-dividend for a dividend of Rs 6 per share for the financial year ended 31st March, 2014.

- Uflex closed 5.38% down at Rs 117.00 on BSE, with the stock sliding on profit booking after Monday's 19.58% rally triggered by the company reporting strong Q4 earnings.

- Ipca Laboratories closed 1.49% up at Rs 800.00 on BSE after the company inked an agreement with US-based Oncobiologics Inc to develop and manufacture bio similar monoclonal antibody products.

- Hero MotoCorp closed 2.96% up at Rs 2,455.75 on BSE, with the stock extending Monday's gains triggered by the company reporting decent sales in May, 2014.

- Hindustan Unilever closed 1.51% down at Rs 592.00 on BSE, with the stock sliding on profit booking after recent rally.

- Eicher Motors closed 5.07% up at Rs 7,206.65 on BSE after the company reported 86% rise in total motorcycle sales to 25,011 units in May, 2014 over May, 2013.

- Ruchi Soya Industries closed 4.36% up at Rs 44.25 on BSE, with the stock recovering on bargain hunting after recent slide.

- Arvind closed 2.24% up at Rs 196.20 on BSE, with the stock extending Monday's gains triggered by the company's joint venture with OG Corporation of Japan inaugurating its manufacturing facilities near Ahmedabad, Gujarat, on 31st May, 2014.

- Tata Chemicals closed 2.66% up at Rs 309.00 on BSE, with the stock recovering on bargain hunting after recent slide.

- Venus Remedies closed 2.05% up at Rs 288.95 on BSE after the company said its novel antibiotic product received European patent.

- India Nippon Electricals closed 3.07% down at Rs 208.45 on BSE as the stock turned ex-dividend on, 3rd June, 2014, for second interim dividend of Rs 5 per share for the year ended 31st March, 2014.

- Hubtown closed 3.12% down at Rs 175.40 on BSE after the promoters have offered to sell an aggregate of 54.4- lakh equity shares, representing 7.49% of the paid-up equity share capital of the company.

- Network 1- Media & Investments closed 5.47% down at Rs 51.85 on BSE on profit booking after the stock surged 43.77% in the preceding five trading sessions to Rs 54.85 on 2nd June, 2014, from a recent low of Rs 38.15 on 26th May, 2014.