The News International Team
9:55 am Grexit reality? Germany’s Angela Merkel played down the chances of a Greek exit from the euro zone, but made clear she expected Athens to stick to the terms of its international bailouts after this month’s election.
The chancellor addressed the issue for the first time since a German magazine said at the weekend her government had shifted its stance and was ready to accept a “Grexit” if Athens failed to meet its commitments under EU/IMF rescue packages totalling 240 billion euros.
She said she had “no doubts whatsoever” that the Greek situation would be brought to a “successful conclusion”, but stressed Athens needed to continue to respect its commitments if it wanted its partners to show solidarity.
As they plan for a possible clash with a new Greek government over bailout terms, they are also exploring a political compromise with the Syriza leader should he take power after the Jan. 25 election.
9:45 am FII view: Adrian Mowat, Chief Asian and Emerging Equity Strategist, JP Morgan is not worried about the fall in crude price. According to him, the fall in oil prices is a boon to G3 consumers and the importing Asian countries.
In an interview to CNBC-TV18, Mowat says the current correction in the global markets must be used as a good buying opportunity. He expects a reasonable 20 percent return from the Indian equities in 2015. ‘Domestic institutions will be key drivers of Indian equities this year,” he adds.
On the upcoming Budget, Mowat says it is a single day event and must not be given too much importance. The day-to-day operations of government matter more than just a one-day affair. He believes the Modi-led government has been working every day since it came to power and hence, Budget event is not a big event.
9:25 am Big buzzing: ING Vysya jumped 2.5 percent while Kotak Mahindra gained 3 percent intraday after shareholders have approved merger of both the banks.
The merger will be done through a share swap in which 725 equity shares of Rs 5 each of Kotak Mahindra will be issued for every 1,000 shares of Rs 10 each held in ING Vysya Bank. The swap ratio indicates price of Rs 790 for each ING Vysya Bank share.
Post the merger that was announced on November 20, 2014, Kotak Mahindra Bank will become the fourth largest private sector lender in India. The biggest three are ICICI Bank, HDFC Bank and Axis Bank.The combined banking entity will have a widespread network of 1214 branches across the country.
Don’t miss: Eyes on eurozone inflation data, ECB meet on Jan 22
After the massive losses in last few days, the market has opened with a bang on Thursday. The Sensex is up 312.29 points or 1 percent at 27221.11 and the Nifty is up 89.30 points or 1 percent at 8191.40. The 50-share index touched 8200 briefly just immediately in opening. About 491 shares have advanced, 65 shares declined, and 351 shares are unchanged.
All banks are up with key gainers like SBI and ICICI BAnk. Wipro, Coal India and Tata Motors are other gainers in the Sensex.
The Indian rupee has opened at 63.20 a dollar , down 3 paise compared to previous day’s closing value of Rs 63.17 a dollar.
Mohan Shenoi, Kotak Mahindra Bank says dollar rally against major currencies has continued on the back of strong US data and FOMC statement on expected lines. Risk sentiment has improved and consequently minor pull back in Indian stock market which earlier saw steep fall is likely. This should support rupee and USD-INR is expected to trade in a range of 63.10-63.40/USD today.”
Meanwhile, the euro held near a nine-year low as investors fear the European Central Bank would have to take bolder stimulus steps to combat growing deflationary pressures in the zone.
In the US, stocks jumped with the S&P 500 rebounding from a five-session dive, as US crude stopped a four-day skid, concerns eased about a Greek exit from the European Union and investors offered a favorable reaction to minutes from the Federal Reserve.
In Europe, shares ended higher, with investors anticipating more stimulus by the European Central Bank after new data showed that the euro zone has entered into deflation. Meanwhile, Germany has left the door open to discussing options with Greece’s next government on its debt.
However, Asian markets are moving higher this morning on the back of a strong overnight handover as global fears ease.
In commodities, crude prices rise following an unexpected drop in crude inventories and a positive economic outlook in US. US crude inventories fell 3.1 million barrels compared with analysts’ expectations for an increase of 880,000 barrels.
From precious metals space, gold eased, halting a three-day winning streak, after the Federal Reserve released the minutes from its mid-December meeting.