HINDUJA BANK (SWITZERLAND) LTD

Transcription

1 HINDUJA BANK (SWITZERLAND) LTD BUILDING WEALTH, ENABLING ENTERPRISE 11 May 2015 DAILY MARKET COMMENTS INDIA SUMMARY The benchmark indices ended at the high point of the day, touching one-week highs, led by strong buying in metal, auto and banking shares. A rate cut by China and uplifting US jobs data kept the momentum going for the markets. The government's decision to ease its combative stance on MAT demand along, accompanied by a decline in global crude oil prices, hopes of a rate cut by Reserve Bank of India and the likelihood of a normal monsoon further boosted investor sentiment. The Sensex ended at 27,507, higher by 401 points or 1.4% and the Nifty ended above the crucial 8,300 mark at 8,325, up 133 points. The metal sector was in the limelight in this session on hopes of pick-up in demand for commodities after China announced a cut in interest rates for the third time in six months. Banking shares, mainly public sector undertakings (PSU) banks, had a roaring session. The Bank index surged by nearly 5% on hopes of a rate cut by RBI as retail inflation is expected to remain below 6%. SBI zoonmed by 5.4% and Bank of Baroda soared 16% after the bank's assets quality improved during the quarter ended March 2015 on a sequential basis. From the auto space, Hero Moto, Tata Motors, Bajaj Auto and M&M gained 1-4% each. Domestic passenger car sales grew 18.14%. HIGHLIGHTS IN THE HEADLINES TODAY Markets end at day's high; Sensex surges 400 points Bank of Baroda soars as assets quality improves in Q4; Q4 profit declines 48% at Rs 5.98 bn Domestic car sales up 18.1%, bikes down 2.7% in April Adani Power's Q4 net profit down 71% at Rs 7.15 bn Credit conditions to strengthen with growth, reforms: Moody's Federal Bank gains on bonus issue plan Relaxo Footwears hits record high on 1:1 bonus issue INSTITUTIONAL ACTIVITY ON NSE, BSE & MCX-SX Category Buy Value (Rs bn) Sell Value (Rs bn) Net Value (R bn) Foreign Institutional Investors (FII) Domestic Institutional Investors (DII)

2 INDEX MOVEMENTS Index Close Open High Low Close Gain / Loss Var. S&P BSE Sensex 27,105 27,249 27,544 27,231 27, CNX Nifty 8,192 8,243 8,333 8,225 8, CNX 500 6,729 6,771 6,843 6,765 6, CNX Nifty Junior 18,920 19,057 19,363 19,046 19, CNX Midcap 12,530 12,602 12,774 12,602 12, CNX IT 11,172 11,225 11,351 11,185 11, CNX 100 8,230 8,283 8,379 8,267 8, BANK Nifty 17,797 17,921 18,241 17,842 18, NIFTY GAINERS Company Curr. Gain BANKBARODA VEDL SBIN ULTRACEMCO 2,823 2, HEROMOTOCO 2,390 2, NIFTY LOSERS Company Curr. Loss HINDUNILVR (3.55) ITC (0.61) COMMODITIES & CURRENCIES Commodity (Futures) Day Curr. Day Brent Crude (USD / bbl) Gold (USD / t. Oz) 1, , Silver (USD / t. Oz) Currency Curr. Rate USD / INR EUR / INR ASIAN MARKETS Index Closing Gain / Loss Var. Hang Seng 27, Nikkei , Shanghai Composite 4, Straits Times 3, Taiwan TAIEX 9, Yen / INR 53.27

3 GLOBAL MARKET OVERVIEW European stocks edged lower today, 11 May 2015 as investors await the outcome of the Eurogroup finance ministers meeting on Greece in Brussels later today. Asian stocks edged higher today, 11 May 2015, led by gains in Chinese stocks, as investors cheered China's latest cut to interest rates to bolster its flagging economy and as US markets rallied on Friday, 8 May 2015 after a robust headline reading for US employment. Key benchmark indices in China, Singapore, Hong Kong, Japan, and South Korea rose by 0.54% to 3.04%. Key benchmark indices in Taiwan and Indonesia were off 0.19% to 0.29%. GLOBAL NEWS The Bank of England made no changes to monetary policy at its meeting today, 11 May 2015, as expected, maintaining its lending rate at a record low of 0.5%. The rate has been held at that level since March The bank's quantitative-easing program was also left unchanged at 375 billion pounds ($579.5 billion). Minutes from the meeting will be released on May 20. The newly re-elected British Prime Minister David Cameron on Sunday, 10 May 2015 reportedly ruled out giving Scotland another independence referendum despite gains by Scottish nationalists in a UK-wide election. Eurogroup finance ministers will meet today, 11 May 2015 to discuss once more Greece's progress in implementing economic reforms in exchange for bailout funds as it gets dangerously close to running out of cash. The Greece government is facing a 750 million euro ($832 million) debt repayment to the International Monetary Fund (IMF) tomorrow, 12 May China cut interest rates for the third time in six months on Sunday, 10 May 2015 to stimulate growth. The People's Bank of China cut its benchmark, one-year lending rate by 25 basis points to 5.1% effective from today, 11 May 2015 and its benchmark deposit rate by the same amount to 2.25%. US stocks surged on Friday, 8 May 2015 after a robust headline reading for US employment. In economic data, the US Labor Department data showed on Friday, 8 May 2015 nonfarm payrolls increased 223,000 in April 2015, while the unemployment rate dropped to a near seven-year low of 5.4%. ECONOMIC AND POLITICAL NEWS Rating agency Moody's today said credit conditions are likely to improve for rated Indian corporates over the next months on the back of upturn in economic activities, government's reform push and transmission of monetary easing. In a report, the global agency said that over the next 12 to 18 months, credit conditions are likely to improve for rated Indian corporates and infrastructure debt issuers in a number of pro-cyclical industries, such as industrials, transport infrastructure, metals and automotives. "These industries stand to benefit from an upturn in economic growth, gradual transmission of monetary easing, weaker commodity prices and the government's pro-growth policy agenda," it said. The NDA government has proposed to substantially reduce the kind of information the whistleblowers will be able to disclose under the Whistleblowers Protection Act, The government has tabled an amendment bill in the Lok Sabha that reduces the mandate of the law considerably. If the amendment is passed, the whistle-blower would no more be able to provide documents and information that are protected under the Officials Secrets Act, 1923 putting all classified and secret documents of the government out of reach.

4 INDUSTRY NEWS Domestic passenger car sales grew 18.14% to 159,548 units in April this year compared with 135,054 in the same month of According to the data released by the Society of Indian Automobile Manufacturers (SIAM), motorcycle sales last month were down 2.77% at 881,751 units from 906,909 in the same month of the previous year. Total sales of commercial vehicles, however, jumped 6.48% to 45,872 units from 43,080 a year ago, SIAM said. SECTOR PERFORMANCE AND TRENDS Out of 2831 scrips traded over BSE, 1758 advanced & 971 declined. Sector Var S&P BSE Fast Moving Consumer Goods (0.32) S&P BSE Healthcare 1.69 S&P BSE Information Technology 1.34 S&P BSE AUTO 2.52 S&P BSE BANKEX 2.40 S&P BSE CAPITAL GOODS 1.18 S&P BSE CONSUMER DURABLES 2.27 S&P BSE METAL 2.52 S&P BSE OIL & GAS 1.25 Sector Trend * Auto BFSI Construction Consumer Goods Energy Industrial Manufacturing IT Metals Telecom * Shows trend for current and previous trading session S&P BSE POWER 1.56 S&P BSE REALTY 0.90 S&P BSE TECK 1.12 BONDS, T-BILLS & IPOs Diagnostics and pathology services company Dr Lal PathLabs has mandated investment banks Kotak Investment Bank and Citi Investment Bank to lead its initial public offering, expected to take place later this year. The IPO is expected to be in the range of $ million (about Rs billion), and could take place around the last quarter of 2015, with the draft red herring prospectus - the preliminary prospectus filed by a company in connection with its IPO - expected to be filed in the next days. With bonds becoming expensive, companies are deferring their plans to raise funds from debt market and preferring to tap banks for funds where lending rates have started coming down. In the last one month, bonds prices have started coming down while yields have gone up. Bond yields have moved up by up to 0.20 per cent in the last one month.

5 COMMODITIES Gold imports have remained unabated in the month of April despite fears that unseasonal rains and hailstorms that had impacted agri crop and fortunes of farmers will impact rural demand for the yellow metal. Trade sources said India's total gold import in April is estimated around tonnes ($3.5-4 billion). Gold import in March was much higher at ($4.98 billion) tonnes but that was because many traders and investors had delayed their purchases in previous months expecting cut in import duty in the budget, the hope that didn't materialised. Gold import in April, 2014 was 58 tonnes. China overtook the United States as the world's top importer of crude oil for the first time in April, and its purchases are expected to remain strong despite a slowing economy, with farreaching consequences for global oil and commodities markets. The soaring imports came as a surprise as growth in the world's second-largest economy was sputtering and its oil demand was expected to ease. However, low oil prices and China's series of interest rate cuts - including one over the weekend - in a bid to stoke growth are factors boosting demand. China's crude oil imports hit a record of almost 7.4 million barrels a day (bpd) last month, putting it ahead of the United States' estimated imports of 7.2 million bpd for April, Reuters data show. COMPANY ANNOUNCEMENTS State-run Bank of Baroda's standalone net profit declined by 48 per cent to Rs 5.98 bn for the quarter ended March 31. Total standalone income rose by 4 per cent to Rs bn in January- March of from Rs bn in the same quarter of the previous fiscal. Adani Power on Monday said that the company reported 71% reduction in consolidated net profit, which stood at Rs bn, for the fourth quarter of , compared to the corresponding period in the previous year. The company's consolidated total income for Q4 of stood at Rs bn while the same for the final quarter of was Rs bn. The information in this publication was developed using data which Hinduja Bank () Ltd assumes to be accurate; nevertheless, Hinduja Bank () Ltd accepts no liability and offers no guarantee. The availability of such information does not constitute a recommendation to buy or sell any of the securities discussed therein. Statements made in this publication can be changed without prior notice. Moreover, the content is not intended for individuals (or entities) who (which), by reason of their nationality or domicile or for any other reason, are subject to foreign regulations prohibiting access to banking services or investment instruments via one or several distribution channels, or prohibiting or restricting the use of any information provided in this document.