Key benchmark indices dropped in choppy trade, with investor sentiment hit by a weak rupee. The S&P BSE Sensex was provisionally down 71.90 points or 0.37%, off close to 265 points from the day's high and up about 50 points from the day's low. The market breadth, indicating the overall health of the market, was negative.
Dr Reddy's Laboratories scaled record high. IT stocks rose on a weak rupee. Index heavyweight Reliance Industries (RIL) reversed intraday gains triggered by its telecom unit, Reliance Jio Infocomm, and Reliance Communications announcing a pact for sharing of RCom's nationwide telecom tower infrastructure.
Bank stocks extended intraday losses in late trade. Auto stocks declined. Metal stocks also fell. Car major Maruti Suzuki India declined as the company suspended production for a day at both of its plants in Manesar and Gurgaon today, 7 June 2013, to adjust inventory levels in response to falling sales.
The rupee hit one-year low below the 57 mark and was trading at 57.06 against the dollar versus its previous close of 56.84/85. A weak rupee makes imports costlier, stoking inflation concerns, thereby capping the Reserve Bank of India's scope to extend monetary easing and counter the slowest economic growth in a decade.
The market recovered after slipping into the red after opening slightly higher. The Sensex hovered in negative terrain in morning trade. Key benchmark indices reversed intraday losses and hit fresh intraday high in mid-morning trade. The Sensex extended gains to hit fresh intraday high in early afternoon trade. Key benchmark indices pared gains after hitting fresh intraday high in afternoon trade. The market regained strength after witnessing high intraday volatility in mid-afternoon trade. The market reversed direction and slipped into the red in late trade.
As per provisional figures, the S&P BSE Sensex was down 71.90 points or 0.37% to 19,447.59. The index lost 121.98 points at the day's low of 19,397.51 in late trade. The index jumped 192.06 points at the day's high of 19,711.55 in afternoon trade, its highest level since 4 June 2013.
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The CNX Nifty was down 35.65 points or 0.6% to 5,885.75, as per provisional figures. The index hit a low of 5,871.30 in intraday trade. The index hit a high of 5,972.70 in intraday trade, its highest level since 4 June 2013.
The total turnover on BSE amounted to Rs 2258 crore, higher than Rs 1688.62 crore on Thursday, 6 June 2013.
The market breadth, indicating the overall health of the market, was negative. On BSE, 1,328 shares fell and 1,029 shares rose. A total of 165 shares were unchanged.
Among the 30-share Sensex pack, 22 stocks fell and rest of them rose.
Auto stocks declined. Car major Maruti Suzuki India declined 2.47%, with the stock extending initial losses. The company has suspended production for a day at both of its plants in Manesar and Gurgaon today, 7 June 2013, to adjust inventory levels in response to falling sales.
A firm yen also weighed on the Maruti counter as it could make imports of components costlier for the car major.
M&M and Tata Motors dropped by 1.69% to 1.98%.
Bank stocks extended intraday losses in late trade. ICICI Bank, HDFC Bank and State Bank of India (SBI) shed by 0.92% to 1.27%.
Metal stocks also fell. Jindal Steel & Power, Sterlite Industries, Hindalco Industries and Tata Steel dropped by 0.93% to 2.18%.
Index heavyweight Reliance Industries (RIL) declined 0.97% with the stock reversing intraday gains. The company today, 7 June 2013, said that its telecom unit, Reliance Jio Infocomm, and Reliance Communications have signed a definitive agreement for sharing of RCom's nationwide telecom towers infrastructure. Under the terms of the agreement, Reliance Jio Infocomm will utilise upto 45,000 ground and rooftop based towers across RCom's nationwide network for the accelerated roll out of its state of the art 4G services. The deal is valued at about Rs 12000 crore.
The agreement provides for joint working arrangements to configure the scope of additional towers to be built at new locations to ensure deep penetration and seamless delivery of next generation services, RIL and RCom said. This agreement follows the inter-city optic fiber sharing agreement already signed in April 2013 as part of a comprehensive framework of business co-operation between Reliance Jio Infocomm and Reliance Communications.
Shares of Reliance Communication dropped in choppy trade. The stock was off 1.49% at Rs 116.40. The stock hit high of Rs 119.90 and low of Rs 115.55 so far during the day.
Bharti Airtel dropped 2.4%.
IT stocks rose on a weak rupee. Infosys, TCS and Wipro gained by 0.8% to 3.48%. A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports.
Mahindra Satyam rose 1.19% after the company said after market hours on Thursday, 6 June 2013, that it has won a new multiyear contract from Bridgestone Europe for its managed services. The company will work on SAP based mission critical applications for Bridgestone Europe. Mahindra Satyam has been working with Bridgestone since 2005 in providing IT application development and support services.
At the end of FY 2012-13, 23% of Mahindra Satyam's total earnings came from Europe. Europe is also a key market for the company in terms of banking, aerospace and defense, sales domains, Mahindra Satyam said.
Dr Reddy's Laboratories rose 2.82% to Rs 2,192.65. The stock hit record high of Rs 2,200 in intraday trade today, 7 June 2013.
Kansai Nerolac Paints lost 1.44% as the stock turned ex-dividend today, 7 June 2013, for dividend of Rs 11 per share for the year ended 31 March 2013.
Mahindra Lifespace Developers jumped 3.82% after the company's board recommended raising foreign institutional investors' investment limit in the paid up equity share capital of the company to 49% from 30%.
European markets edged lower on caution ahead of the much anticipated nonfarm payrolls report from the US. Key benchmark indices in France and Germany were down 0.5% to 0.19%. However, UK's FTSE 100 rose 0.03%.
The European Central Bank (ECB) and the Bank of England (BoE) on Thursday, 6 June 2013, held their main interest rates at record lows, with the ECB saying data supports its forecast of a gradual economic recovery across the region. The ECB and BoE both held their benchmark interest rates at the record-low level of 0.5%.
Asian stocks fell on Friday as gains in yen weighed on Japanese shares and as investors awaited a US jobs report later in the global day. Key benchmark indices in Singapore, Japan, Indonesia, Taiwan and South Korea shed 0.01% to 2.72%.
Chinese stocks dropped ahead of a long weekend and before the release of a slew of economic data over the next three days, including monthly inflation and exports. Key benchmark indices in China and Hong Kong were off 1.21% to 1.39%. Mainland Chinese markets are closed from Monday, 10 June 2013 to Wednesday, 12 June 2013, for the Dragon Boat Festival.
Trading in US index futures indicated that the Dow could fall 8 points at the opening bell on Friday, 7 June 2013. US stocks ended higher on Thursday, snapping a two-session losing streak, as investors eagerly awaited Friday's May employment report for clues about monetary policy. Data showed that US jobless claims fell by 11,000 to 346,000 in the week ended June 1, essentially in line with expectations.
Federal Reserve Chairman Ben Bernanke said last month that the bank could start scaling back its aggressive easing program in coming months if data continue to improve.
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