The News International Team
11:50 am Rupee check: The rupee spurted 43 paise to trade at a fresh one-month high of 61.75 against the dollar as the RBI cut interest rates by 25 bps to 7.75 per cent.
After opening strong at 61.72 at the Interbank Foreign Exchange market, the domestic unit hovered in the range of 61.71 and 62.19 in the morning trade.
Forex dealers said a strong domestic equity market and dollar’s weakness against other Asian currencies also supported the rupee.
11:40 am Poll: Bajaj Auto ‘s third quarter profit is expected to fall 6 percent to Rs 850 crore for the quarter ended December 2014, according to the average of estimates of analysts polled by CNBC-TV18. Profit in the year-ago quarter was Rs 904 crore. The company will announce its earnings on Thursday. The two-wheeler maker’s revenue may jump 9 percent to Rs 5,591 crore during October-December quarter compared to Rs 5,131.2 crore in same quarter last fiscal, supported by higher export sales volumes. Big decline in domestic motorcycle sales has been continued but year-on-year growth in both exports and 3 wheelers has been strong. Domestic motorcycle sales fell 13.5 percent on yearly basis to 4.94 lakh units. Even domestic motorcycle market share dropped significantly to 12 percent in H1FY15 from 14 percent in FY14 and 19 percent in FY10.
11:30 am Market outlook: Hailing the Reserve Bank’s move to pare repo rate by 25 basis points, Raamdeo Agrawal, joint managing director, Motilal Oswal Financial Services, says the cut was imminent for the Indian market due to global deflation and fall in inflation.
In an interview to CNBC-TV18, Agrawal says the rate cut will give a momentum to the economy and he sees more rate cuts in the upcoming days.
“But don’t try to time the market,” advises Agrawal who believes that retail investor participation will now increase significantly.
“Though we may not get very large foreign instituitional investor (FII) flows, if we get USD 15 billion from FIIs and a similar figure from domestic instituitional investor (DIIs), then we’ll still be very comfortable,” he adds.
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The stellar rally on Dalal Street continues. The Sensex is up 494.69 points or 1.8 percent at 27841.5 and the Nifty is up 144.10 points or 1.7 percent at 8421.65. About 1523 shares have advanced, 717 shares declined, and 311 shares are unchanged.
The market welcomes the move with the Nifty capturing 8400 last seen on January 5, led by gains in the Bank Nifty that hit a record high. Midcap index also touched an all time high.
Industry and experts welcome the move. The chief economic advisor Dr Arvind Subramaniam says there has been a shift in dis-inflationary pressures and quantum or rate cuts and time will be determined by data.
ICICI Bank, HDFC, SBI, Tata Power and M&M are top gainers in the Sensex while GAIL, Tata Steel and Sesa Sterlite.
Oil prices fell in Asia today after a bargain-buying rally the day before lost steam, with a pick-up in US inventories reinforcing reinforcing concerns about weak demand and a supply glut. US benchmark West Texas Intermediate (WTI) for delivery in February fell 37 cents to USD 48.11 in late-morning trade and Brent crude for February fell 56 cents to USD 48.13. Both contracts rose sharply yesterday — WTI gained USD 2.59 and Brent advanced USD 2.10 — as bargain hunters moved in after prices tumbled close to six-year lows.
Analysts say the market remains hobbled by weak fundamentals, notably weaker demand and an oversupply of the commodity as the world’s major oil producers have vowed to maintain production levels.