The Finance Ministry granted approval to 12 proposals of PSBs to raise a sum of Rs 2,914.038 crore through preferential allotment and United Bank via QIP.
Nifty stays in a range between 5750 to 6050, any meaningful breakout above 6050, could lead get to the newer levels.
Tirthankar Patnaik of Religare Capital Markets, shares his views on the RBI policies.
"I believe the markets were excited about the state elections, which is unprecedented," says Ritu G Arora
Raghuram Rajan got prize in recognition of his ground-breaking research work which has influenced financial and macro-economic policies around the world.
Punjab National Bank has already raised Rs 1,000 crore by selling infrastructure bonds at 8.23 per cent with 10-year maturity.
1000 point of rally in Nifty obviously expects 250 to 300 point correction out of which 200 point correction has already happened today.
Nifty may take immediate support at 5640 and strong support at 5600-5580, in case of any profit-booking.
Rate sensitive stocks in banks, realty, capital goods and auto sector rallied in morning trade, supported by sharp short covering rally.
Infusion of Rs 4,000 crore would take the lender's total capital adequacy to over 13 per cent, with the core tier-I at 9.8 per cent.
“It has been decided in consultation with the Government of India to introduce greater flexibility in the pricing of instruments/securities,” RBI said.
Rajan went on to say that even as growth from large companies has slowed down, rural areas have been contributing to the economy.
“Sentiment was buoyed by the higher-than-expected stimulus measure by the ECB as well as the optimism created by RBI’s rate cut last week,” said Dipen Shah.
In a veiled attack on the govt, Subbarao said the country’s economy would have been better had the monetary tightening begun earlier.
The central bank has stated that once the monetary policy stance shifts, subsequent policy actions will be consistent with this stance.
Tackling supply side constraints for arresting food prices should be top most priority of new government, India Inc today said, after inflation rose again in March.
The RBI last week surprised the markets with a 25 basis point reduction in interest rates and signalled that it could cut further, amid signs of cooling inflation.
The metal sector has seen a strong rebound in terms of pricing. If you look at the category as a whole, ferrous and non-ferrous, the pricing has moved up significantly.
Among auto stocks, Mahindra & Mahindra rose by 3.10 per cent, Maruti Suzuki India by 3.04 per cent, Tata Motors by 2.33 per cent and Bajaj Auto by 2.30 per cent.
Home loan borrowers may see lower equated monthly instalments (EMIs), which however may not fall for all across the board.
Demonetisation may cause a temporary dip in the economy as purchases are postponed, but the long-term picture is looking bright, says Aashish Sommaiyaa, MD & CEO, Motilal Oswal AMC.
Banking index was down 0.2%, Capital Goods Index lost 1.2% and the Realty index was trading 0.6% lower as compared to 0.02% per cent fall in the Sensex.
The RBI maintained status quo at its 5th bi-monthly monetary policy review by keeping repo rates unchanged at 6.75 per cent.
The market level is at a life time high, but the market PE is just at an average. This probably could be the beginning of good times for these markets, he said.
"There could be outflows; no doubt about that. But I am not sure whether it will be a knee-jerk reaction or a sustained phenomenon."
“We are in very, very murky waters and I would sense that the markets could certainly drift lower”
"Even if the RBI does a 25 bps cut but gives a very definitive dovish guidance, market may continue the rally."
India has seen one of the largest outflows within EMs - strong outflow of close to $1 billion each was also seen from South Korea, Brazil, and Thailand.
GST which is very good from a tax GDP ratio perspective, throws up a collateral damage.
The RBI today said the measures would be rolled back in a calibrated manner once stability is restored in the forex market.
If credit picks up in the second half in the busy season and then the banks may not need to buy G-sec, which could have some impact on bond prices.
While the RBI's policy stance could result in interest rates rising, it would help maintain financial stability, she said.
My first reactions -- fuel price obviously has dropped. It has a bigger influence on the WPI than the CPI.
"What the IIP number is showing us is a broader trend of a very sharp slowdown in the economy, which is already getting corroborated by other numbers like automobile numbers and mobile subscriber base," says Sanjay Sinha.
Big time reforms cannot revive the overall economic situation because this government is really no different from the earlier government.
The slowdown in China has affected the global markets. Despite easy monetary policies from China, the commodities market has failed to pick up.
Srei BNP Paribas today raised its benchmark rate by 0.25 per cent to 17.25 per cent following a rise in borrowing cost.
Indian markets are expected to trade in a range. Here is a list of ten stocks which are likely to be in focus today.
'In the short term, the markets are taking it as a fact that a large part of the crude price fall will be passed on to customers,' says Gorakssakar.
'On the fiscal front, there are some concerns. The RBI would probably want to wait for the budget before they go ahead with any further action,' says Bhardwaj.
From the macro perspective, the sharp plunge in oil prices is extremely positive for the government to put its house in order.
'The macros and interest rates are not supportive of growth right now. RBI's policy has done a huge damage to India's growth prospects,' Sharma said.
November series witnessed a strong bull-run and breached 8,500 for the first time in history. It registered a lifetime high at 8,540 levels.
Tracking the momentum, the index is expected to reclaim 8500 and head higher to touch its fresh record highs.
"The recent depreciation of the rupee and the absence of any uncertainty about its future course warranted holding action by the RBI," HDFC Bank said.
" I expect the rupee to be stabilising very soon and if a rate cut has not happened this time, it does not mean that it can be postponed for long."
India Inc today asked the RBI cut key rates and demanded that the government take immediate steps to revive manufacturing.
The south-west monsoon would touch Mumbai during next 48 hours, Indian Meteorological Department said today.
"There is a need to ensure that more underlying supply side issues are resolved so that demand side is taken care of and prices are under manageable levels," he said.
Giving up the fight on inflation by saying that food is beyond RBI's control is underestimating the power of the central bank," Rajan said.
India Inc expressed disappointment over the RBI increasing the key rate by 0.25% and hoped that banks would refrain from hiking lending rates.
Rajan, who surprised the markets with his actions at three policy meets after taking charge, is unlikely to do so again and is widely expected to keep key rates on hold.
"I guess it will continue for some more time. But then, we might have a change of base at some point, which might make a bit of a difference to the overall WPI number."
If you are reading this, chances are the Sensex and the Nifty are part of your daily life, and actions on Dalal Street can make or mar your day.
The top rupee forecaster sees the currency maintaining its position as Asia’s best performer after India allowed foreigners greater access to its debt.
A 50 bps rate cut announced by RBI in recent monetary policy review could attract an average annual flow of Rs 48k cr in govt bonds.
Soon after the RBI policy announcement, FM Arun Jaitley had expressed hope that banks will transmit the benefit to borrowers.
All the factors such as a slow domestic economic expansion, negative inflation and low CAD at 0.2 per cent of GDP make a compelling case for a rate cut.
RBI Governor Raghuram Rajan may budge to government and industry pressure to cut interest rate with a view to spur economic recovery.
Falling gold prices is "net positive" for the Indian economy and if the precious metal settles at current levels CAD is likely to be 3.9 pc in 2013-14.
The S&P BSE Sensex closed 541.14 points, or 2.07 per cent, lower at 25,651.84. It hit a low of 25,571.34 and a high of 26,339.10 during the day.
ET Now spoke to various experts and here's what they have to recommend for today's trade:
"It is a good decision by RBI since the data was not confirmatory, in terms of giving a direction on where inflation is heading," he said.
"Compared to the food inflation in the previous period, it is almost at a 15-year high and contributes nearly one-third to the overall inflationary pressure."
The clamour for a rate cut is just getting louder. Industry experts expect at least a 50-bps reduction in repo rate, reports ET Now.
“We are adding some of the names in the cyclical space especially the corporate lenders, some of the metal names and typical oil and gas sector which were not in favour for last three to four years.”
Trading of interest rate futures (IRF) on BSE, NSE and MCX-SX cumulatively stood at about Rs 1.48 lakh crore during April-September period.
"There is every possibility that the cost of deposit may witness a rapid fall in the next quarter or so. That will enable the banks to start transmitting the cuts."
The Reserve Bank is likely to switch focus to supporting growth from fighting inflation and is likely to go for 0.75 per cent rate cut in the current fiscal, BofA ML said in a report.
“Commodities, PSU banks and to some extent the industrial sector, are the three sectors that we think can help profit growth in FY18 as well.”
"For markets, the policy has come as per expectations. More importantly, those expectations were managed way ahead of the policy."
"We are expecting perhaps another cut in the SLR. But, absolutely, no change on the rate front," says Indranil Pan.
If the tapering is starts because the US economy is producing data which is better than expectations, then it should be positive for India.
Since taking over in early September, Governor Raghuram Rajan has hiked rates twice with an eye on inflation, which quickened to 7 per cent in October.
According to analysts, the market is near important support levels and the correction can be utilized to buy some stocks.
SBI chairman said that there is no scope of transmitting the RBI's repo rate cut. "Repo rate cut will have no impact on loan, deposit rates," he said.
The RBI cut repo rate by 25bps to 7.5% for the second time since the start of the year, but warned that its scope for further policy easing is limited.
"Food prices might go up in the near future, but given the lower oil prices, it is unlikely that in the immediate future they will go up."
Realty and banking stocks today gained as much as 8 per cent as core inflation in February fell below 4 per cent mark for the first time in nearly 3 years.
Rajan said politics and history both have been important forces in determining the economic policymakers' goals and tactics globally.
S&P outlook upgrade provided some bit of respite but analysts still feel that the bias is on the downside till the time Nifty trades below 8100 levels.
“If the trajectory of the rate hikes into 2017 is more than what the markets are anticipating that clearly would be the negative event.”
The Indian markets are witnessing a choppy session as bulls took a breather after two-days of gains.
'India has brought about a lot of positive changes compared to the previous quarter,' says Arindam Ghosh.
Industrial production expanded at a 4-month high rate of 3.8 per cent in June due to improvement in manufacturing activity.
Poor performance of IIP has led to further expectations of a reduction in key policy rates by Reserve Bank of India (RBI).
Reserve Bank of India Governor Raghuram Rajan kept interest rates unchanged as expected but raised hopes of a cut before year end.
RBI said that inflation projections for January-March 2016 are lower by about 0.2%, with risks broadly balanced around the target of 6.0% for January 2016.
"One of the key factors which will impact the Indian markets is FII allocations in emerging markets over the next few weeks or so."
Sell Zee Telefilms at a stop loss of Rs 225.5 - Rs 226.
The ten-year new benchmark bond yields on Monday fell about five basis points to 8.60% prompting some amount of bullishness.
If the interest rate on a 20 year housing loan of Rs 50 lakh home lowers to 11% from 11.25%, it will translate into a saving of Rs 853 per month in the EMI.
ET Now spoke to various experts and here's what they have to recommend for today's trade:
After a better start at 20,072.28, Sensex fell by 102.83 pts, or 0.51 pc to 19,923.78 as auto majors Tata Motors and M&M recorded losses.
At this point in time, I would still want to be more bullish than bearish, says Prateek Agarwal, ASK Investment Managers.
After rallying as much as 106 points in morning trade, the S&P BSE Sensex slipped in the red as the RBI kept repo rate unchanged at 8%.
The market is rebounding after a sharp correction in last trading session. The intermediate trend remains weak and profit booking is likely to continue.
"It is very important to stay with quality in the midcap universe particularly now that most of them have run up," Purushottam said.
The State Bank of India has made loans dearer by raising base rate by 25 basis points, ahead of RBI’s annual monetary policy review on May 3.
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