The News International Team
9:56 am Petrol price cut: Petrol price was today cut by 54 paisa a litre, but the first reduction in diesel rates in over five years was put off until the return of Prime Minister Narendra Modi from the US. State-owned oil firms, which skipped raising rates on September 16 even though their cost had gone up, cut prices in view of the downward trend in international markets.
Petrol price was reduced by 54 paisa a litre without including local sales tax or VAT, with effect from midnight tonight.
9:45 am Weak yen: The dollar hit a new high six-year high against the yen, breaching 110 for the first time since August 2008. The currency pair reached 110.08 in early Asian trading, prompting a response from a Japanese government spokesperson, saying authorities will monitor the yen’s movement carefully.
The greenback has strengthened more than 8 percent against the yen since early August, driven by the Federal Reserve’s tightening monetary policy and recent weakness in the Japanese economy.
9:30 am Deposit rate cut: State Bank of India has reduced the short-term deposit rates by 1 percentage point for amount below Rs 1 crore, second such move this month. In an exchange filing on Tuesday, the banking giant said it has reduced the pricing of short-term deposits of below Rs 1 crore to 6 percent from 7 percent now for a maturity of 7 to 45 days.
The new pricing will be effective October 7, said the lender, which controls close to a quarter of the total liabilities in the banking system. The bank has retained the existing rates for all other maturities in this bucket.
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Equity benchmarks started October month on a flat note with the Sensex falling 2.97 points to 26627.54 and the Nifty declining 5.95 points to 7958.85 while the broader markets saw marginal gains.
The BSE Midcap and Smallcap indices gained 0.3 percent each. About 596 shares have advanced, 254 shares declined, and 27 shares are unchanged.
Auto sector will remain in focus today as all auto companies are going to announce their September auto sales data. Strong volume growth is expected across all segments on the back of improvement in the demand scenario in the past 2-3 months. Hero Motocorp’s total September sales came in 30 percent higher at 6 lakh units; the stock gained 2 percent.
Wipro extended gains, up nearly 2 percent. TCS, Sesa Strelite and Dr Reddy’s Labs are top gainers in the Sensex. Among the losers are GAIL, ITC, Tata Steel, Tata Power and HDFC.
The Indian rupee declined in the early trade. It has opened lower by 18 paise at 61.93 per dollar against 61.75 Tuesday.
Mohan Shenoi of Kotak Mahindra Bank said, “With the USD appreciating in response to expectation of rise in dollar interest rates, dollar-funded carry trades are shifting to euro as an attractive funding currency.”
“This dollar rally is impacting rupee to some extent. The rupee is expected to trade today in a range of 61.60-62/dollar,” he added.
On the global front, the US stocks fell with equities posting September losses and quarterly gains, as portfolio managers engaged in end-of-quarter positioning. S&P 500, Nasdaq extended quarterly win streak.
On the economic data front – the S&P Case Shiller Home Price Index rose at an annual pace of 6.7 percent in July. That is the lowest pace of growth in twenty months. US consumer confidence has fallen unexpectedly this month, to a four-month low.
In Europe, shares closed broadly higher, as investors focused on key data from the euro zone rather than the geopolitical risk posed by the protests in Hong Kong.
Two of the Asian markets, Hong Kong and Shanghai are closed. Hong Kong markets are closed until Friday, while Shanghai markets are shut until October 7.
In Japan, Bank of Japan’s Tankan survey showed business sentiment improving in the past quarter. Kospi extended losses into a fourth session.
In the currency space, dollar gained strength and trades near 4-year high. The euro languished near a fresh two-year trough having come under fire as a further slowdown in euro zone inflation intensified pressure for more stimulus from the European central bank.