After languishing in red earlier during the day, key benchmark indices extended losses during the latter part of the trading session as European stocks dropped after the latest data showed that activity in the euro zone's private sector slowed again this month. The barometer index, the S&P BSE Sensex, fell below the psychological 27,000 mark. The Sensex and the 50-unit CNX Nifty, both, hit their lowest closing level in almost a week. The market breadth indicating the overall health of the market was weak, with more than two losers for every gainer on BSE. All the twelve sectoral indices on BSE were in the red. The Sensex lost 431.05 points or 1.58% to settle at 26,775.69. Quite a few side counters fell sharply. The BSE Mid-Cap index tumbled 1.91%. The BSE Small-Cap index shed 2.48%.
Realty, oil and gas, and capital goods stocks lead today's decline. Bank stocks slumped. Metal and mining stocks tumbled on concerns about weak Chinese demand. Auto and two-wheeler stocks also declined. Index heavyweight Reliance Industries (RIL) dropped. Meanwhile, Food Minister Ram Vilas Paswan reportedly said that the government has no plans to raise grain allocations under its food welfare programme after a newspaper had quoted him calling for an increase in such subsidised handouts.
Pharma stocks were mostly lower after the Department of Pharmaceuticals, under the Ministry of Chemicals and Fertilizers, scrapped guidelines issued on 29 May 2014 that gave the National Pharmaceutical Pricing Authority (NPPA) the powers to fix the prices of drugs that are not on the essential medicines list.
In overseas markets, European stocks extended initial losses after the latest data showed that activity in the euro zone's private sector slowed again this month. Asian stocks edged lower after a preliminary reading of China's manufacturing sector showed activity making a surprise improvement this month while the subindexes for the flash manufacturing Purchasing Managers' Index (PMI) report painted a mixed picture. US stocks closed sharply lower yesterday, 22 September 2014, on concerns about global growth amid falling commodity prices.
Earlier, key indices had drifted lower after alternately swinging between positive and negative zone in early trade.
Brent crude oil prices rebounded from a one-week low after a survey showed China's factory activity unexpectedly picked up in September.
In the foreign exchange market, the rupee edged lower against the dollar on month-end dollar demand from importers to pay month-end bills.
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The S&P BSE Sensex tumbled 431.05 points or 1.58% to settle at 26,775.69, its lowest closing level since 17 September 2014. The index lost 462.67 points at the day's low of 26,744.07 in late trade. The index rose 50.13 points at the day's high of 27,256.87 in early trade, its highest level since 9 September 2014.
The CNX Nifty shed 128.75 points or 1.58% to settle at 8,017.55, its lowest closing level since 17 September 2014. The index hit a low of 8,008.10 in intraday trade. The index hit a high of 8,159.75 in intraday trade.
The total turnover on BSE amounted to Rs 3800 crore, higher than Rs 3299.06 crore on Monday, 22 September 2014.
The market breadth indicating the overall health of the market was weak, with more than two losers for every gainer on BSE. On BSE, 2,148 shares declined and 875 shares rose. A total of 79 shares were unchanged.
The BSE Mid-Cap index tumbled 188.67 points or 1.91% to settle at 9,696.15. The BSE Small-Cap index shed 279.39 points or 2.48% to settle at 10,969.30.
Among BSE sectoral indices, the S&P BSE Auto index (down 1.88%), Bankex index (down 1.76%), Consumer Durables index (down 1.59%), Capital Goods index (down 2.4%), Healthcare index (down 2.15%), Metal index (down 2.33%), Oil & Gas index (down 2.58%) and Realty index (down 4.91%) underperformed the Sensex.
The FMCG index (down 0.38%), IT index (down 0.64%), Power index (down 1.48%), and Teck index (down 0.98%), outperformed the Sensex.
Reliance Industries (RIL) fell 2.52% to Rs 966.10. The stock was volatile. The stock hit high of Rs 994.95 and low of Rs 963. The company after market hours on Monday, 22 September 2014, said that its subsidiary Reliance Jio Infocomm (Reliance Jio) and Indus Towers have signed a master services agreement (MSA) for tower infrastructure sharing. Under the agreement, Reliance Jio would utilize the telecom tower infrastructure services being provided by Indus Towers to launch its services across the country. As per the agreement, the pricing would be based on prevailing market rates.
Realty stocks tumbled. Unitech (down 10.77%), D B Realty (down 5%), Godrej Properties (down 4.06%), Housing Development & Infrastructure (down 3.18%), Oberoi Realty (down 3.27%) and Sobha Developers (down 1.42%) declined.
DLF shed 6.51% at Rs 155.80. A foreign brokerage has reportedly downgraded the stock to reduce from hold and cut its target price. The brokerage cited limited upside potential for shares and no major potential catalysts in the near-term. It highlighted DLF's weak operational data and negative newsflow from ongoing legal cases.
Meanwhile, the Delhi government has reportedly announced upto 20% increase in circle rates effective Tuesday, 23 September 2014. The circle rates are minimum rates below which a property cannot be registered and forms the basis of stamp duty and registration charges for a property. Circle rates, introduced in 2007, are revised periodically. In Delhi, these rates were last revised in November 2012, when the rates were hiked by 200%.
Bank stocks slumped. Canara Bank (down 4.17%), Bank of India (down 3.38%), Bank of Baroda (down 2.66%), Punjab National Bank (down 2.15%), ICICI Bank (down 2.46%), Federal Bank (down 2.1%), Axis Bank (down 2.18%), IndusInd Bank (down 1.75%), State Bank of India (down 1.77%), Yes Bank (down 1.64%), HDFC Bank (down 0.95%) and Kotak Mahindra Bank (down 0.18%) declined.
Metal and mining stocks tumbled. JSW Steel (down 3.46%), Tata Steel (down 2.95%), Hindalco Industries (down 3.09%), Hindustan Zinc (down 2.82%), Steel Authority of India (down 2%), NMDC (down 1.97%), Jindal Steel & Power (down 1.66%) and Sesa Sterlite (down 0.72%) declined.
Capital goods stocks slumped. Bharat Heavy Electricals (down 2.54%), Siemens (down 0.44%), ABB (down 2.69%), Crompton Greaves (down 2.86%), Thermax (down 2.76%), and Alstom T&D India (down 1.82%) declined.
L&T declined 2.41% to Rs 1,496.80. L&T during market hours today, 23 September 2014, said that the company has launched and priced an accelerated offering of foreign currency convertible bonds (FCCBs) to raise $200 million. The bonds carry a coupon of 0.675%m payable semi-annually with a tenor of 5 years and 1 day and initial conversion price of Rs 1,916.50 per share.
IT stocks declined. MphasiS (down 1.33%), TCS (down 1.17%), Infosys (down 1.04%), and Wipro (down 0.05%) declined.
Tech Mahindra lost 0.11% at Rs 2,468.35. The company during market hours announced that it has been selected by Ahlstrom to manage its IT operations. With the multi-year, multi-million euro agreement, Ahlstrom aims to increase efficiency, harmonize service levels and lower IT costs, Tech Mahindra said in a statement.
HCL Technologies rose 1.42% to settle at Rs 1,723.90. The stock hit a record high of Rs 1,734.30 in the intraday trade.
PSU OMCs edged lower. BPCL (down 2.99%), Indian Oil Corporation (IOC) (down 4.27%), and HPCL (down 1.68%) declined.
PSU OMCs have over recovery of 35 paise per litre on sale of diesel for the current fortnight, as per data released by the Petroleum Planning & Analysis Cell on 16 September 2014. PSU OMCs are currently incurring daily under-recovery of Rs 190 crore on the sale of Diesel, PDS Kerosene and Domestic LPG.
Shares of state-run upstream oil and gas companies also declined. ONGC (down 2.78%), GAIL (India) (down 2.33%) and Oil India (down 1.85%) declined.
State run upstream companies share a part of the under recoveries of state-run oil marketing companies (PSU OMCs) by allowing discount in the prices of crude oil, PSD kerosene, and domestic LPG based on the rates of discount communicated by the Ministry of Petroleum and Natural Gas and the Petroleum Planning & Analysis Cell.
Pharma stocks dropped. Aurobindo Pharma (down 4.88%), Cipla (down 4.65%), Glenmark Pharmaceuticals (down 3.75%), Ranbaxy Laboratories (down 3.41%), Lupin (down 2.35%), Biocon (down 2.29%), Sun Pharmaceutical Industries (down 2.14%), Dr Reddy's Laboratories (down 0.29%) and Divi's Laboratories (down 0.24%) declined. Sanofi India (up 11.35%) and GlaxosmithKline Pharma (up 1.7%) gained. The NPPA had issued a notice in July imposing price caps on more than 100 diabetes and cardiovascular medicines that weren't considered essential by the government, a move that had surprised pharmaceutical companies and investors.
Auto stocks edged lower. Ashok Leyland (down 4.65%) and Eicher Motors (down 0.96%) declined.
Mahindra & Mahindra fell 1.72% at Rs 1,347.90. A foreign brokerage has reportedly downgraded M&M stock to neutral from outperform, saying valuations are no longer attractive.
Tata Motors lost 4% at Rs 517.80. A foreign brokerage has reportedly upgraded the Tata Motors stock to outperform from neutral, citing abating near-term concerns on factors such as volume. It said shares have under-performed the auto sector recently and the company's long-term story remains promising.
Maruti Suzuki India advanced 0.07% at Rs 3,065.20.
Shares of two wheeler makers fell. Hero MotoCorp (down 0.06%), Bajaj Auto (down 0.45%) and TVS Motor Company (down 1%) declined.
Indian stocks may remain volatile this week as traders roll over positions in the futures & options (F&O) segment from the near month September 2014 series to October 2014 series. The near-month September 2014 F&O contracts expire on Thursday, 25 September 2014.
Foreign portfolio investors bought shares worth a net Rs 66.28 crore from the secondary equity markets yesterday, 22 September 2014, as per the data from the Securities and Exchange Board of India.
The Sensex has gained 137.58 points or 0.51% in this month so far (till 23 September 2014). The Sensex has gained 5,605.01 points or 26.47% in calendar year 2014 so far (till 23 September 2014). From a record high of 27,354.99 on 8 September 2014, the Sensex has declined 579.30 points or 2.11%. From a 52-week low of 19,264.72 on 1 October 2013, the Sensex has risen 7,510.97 points or 38.98%.
In the foreign exchange market, the rupee edged lower against the dollar on month-end dollar demand from importers to pay month-end bills. The partially convertible rupee was hovering at 60.9750, compared with its close of 60.825 during the previous trading session.
Brent crude oil prices rebounded from a one-week low after a survey showed China's factory activity unexpectedly picked up in September, helping brighten the demand outlook in a market that has been weighed by a supply glut. Brent for November settlement was up 32 cents at $97.29 a barrel. The contract had fallen $1.1 a barrel or 1.12% to settle at $96.97 a barrel yesterday, 22 September 2014, the lowest close since 15 September 2014.
Israel reportedly shot down a Syrian fighter jet as the US and allies expanded airstrikes on Islamic State into Syria.
Meanwhile, Food Minister Ram Vilas Paswan reportedly said that the government has no plans to raise grain allocations under its food welfare programme after a newspaper had quoted him calling for an increase in such subsidised handouts. Paswan had said in a newspaper interview published today, 23 September 2014, that the monthly entitlement of 5 kg foodgrain per person under food security law was meagre and that the government intends to increase the monthly entitlement to 7 kg.
Prime Minister Narendra Modi is scheduled to launch the ambitious 'Make in India' campaign on Thursday, 25 September 2014. The initiative is one of the several steps which government has announced in order to improve ease of doing business in India and attract investments to boost manufacturing in the country. In his maiden independence day address, Modi invited the global business community to set up manufacturing facilities in India, giving the slogan 'come, make in India'.
European stocks today, 23 September 2014, extended initial losses after the latest data showed that activity in the euro zone's private sector slowed again this month. Key indices in Germany, London and France were off 1.15% to 1.69%.
Markit Economics today, 23 September 2014, said euro area business activity grew in September at the lowest rate seen so far this year, according to the preliminary 'flash' PMI survey data. At 52.3, down from 52.5 in August, the Markit Eurozone PMI Composite Output Index fell for a second month running, dropping to its lowest since December of last year.
Meanwhile, September data signalled a continuation of the ongoing expansion in German private sector output, as highlighted by the seasonally adjusted Markit Flash Germany Composite Output Index rising slightly from 53.7 in August to 54. The current period of growth now stretches to 17 months and surveyed companies generally linked this to increased order intakes.
The latest flash PMI data from Markit Economics today, 23 September 2014, indicated a fifth consecutive monthly decline in French private sector output during September. At 49.1, down from 49.5 in August, the seasonally adjusted Markit Flash France Composite Output Index, based on around 85% of normal monthly survey replies, was at its lowest level in three months, albeit signalling a marginal rate of contraction. Flash manufacturing PMI climbed to a 4-month high of 48.8 in September, from 46.9 in August. Service sector activity fell for the first time in three months during September, offsetting a slower decline in manufacturing output, the latest data showed.
Asian stocks edged lower today, 23 September 2014, after a preliminary reading of China's manufacturing sector showed activity making a surprise improvement this month while the subindexes for the flash manufacturing Purchasing Managers' Index (PMI) report painted a mixed picture. Key benchmark indices in Indonesia, Hong Kong, Taiwan, and South Korea were off 0.49% to 0.61%. Key benchmark indices in Singapore and China rose 0.11% to 0.87%. Japanese markets were shut for a holiday.
A Chinese manufacturing gauge unexpectedly increased this month. The preliminary Purchasing Managers' Index from HSBC Holdings Plc and Markit Economics was at 50.5, up from August's final reading of 50.2. The data was released today, 23 September 2014. Subindexes for the flash PMI report painted more of a mixed picture, however, with new export orders and overall new orders both showing gains at a faster rate than in August, but with the employment subindex falling at a faster rate. Likewise, prices for both inputs and outputs saw further weakness. HSBC chief China economist Hongbin Qu said in remarks accompanying the PMI data that economic activity in the manufacturing sector showed signs of stabilization in September. However, overall, the data still point to modest expansion, he said.
Trading in US index futures indicated that the Dow could fall 44 points at the opening bell on Tuesday, 23 September 2014. US stocks closed sharply lower on Monday, 22 September 2014, with the S&P 500 index suffering its biggest one-day decline since early August, as the latest housing data came in much weaker than expected, raising new concerns about the rate of growth in the economy. Sales of existing homes unexpectedly declined in August, for the first time in five months, the National Association of Realtors (NAR) reported. NAR attributed the drop to fewer all-cash sales to investors
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