Key benchmark indices edged lower in early trade tracking negative global cues. At 9:18 IST, the barometer index, the S&P BSE Sensex, was down 127.09 points or 0.48% at 26,475.75. The Nifty 50 index was currently down 50.50 points or 0.62% at 8,131.95.
The BSE Mid-Cap index was currently down 0.53%. The decline in this index was higher than the Sensex's decline in percentage terms. The BSE Small-Cap index was currently off 0.41%. The decline in this index was lower than the Sensex's decline in percentage terms.
Overseas, Asian stock markets edged lower as the dollar strengthened sharply and investors digest the Federal Reserve's first interest rate rise this year and its hawkish rate outlook for 2017. Higher interest rates in US would attract foreign investments from emerging markets towards the US.
US stocks ended a volatile session lower yesterday, 14 December 2016, as investors grappled with the prospect of a faster pace of rate increases in 2017 than had been previously forecast.
The Federal Reserve raised its key short-term rate yesterday, 14 December 2016, on the expected lines, but it also forecast three rate increases in 2017, compared with the two that had been anticipated at its previous meeting in September. The increase was unanimous and modest, raising the Fed's key interest rate by a quarter point, from a range of 0.25 to 0.5% to a range of 0.5 to 0.75%.
Closer home, the market breadth, indicating the overall health of the market, was negative. On the BSE, 675 shares declined and 435 shares rose. A total of 51 shares were unchanged.
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Cipla was up 0.99% at Rs 574.10 after the company announced that Cipla Holding B. V., a wholly owned subsidiary of the company in Netherlands, Cipla Netherlands, has entered into a joint venture agreement with Ahran Tejarat Company. The announcement was made after market hours yesterday, 14 December 2016. Cipla Netherlands will hold a 75% stake in a joint venture company in Iran while Ahran Tejarat will hold the remaining 25% stake. Investment by Cipla Netherlands is estimated to a maximum of Euro 16.875 million. The joint venture proposes to undertake manufacturing and marketing of pharmaceutical products in Iran.
Separately, Cipla announced that a meeting of the board of directors of the company is scheduled to be held on 19 December 2016, to consider the proposal of raising funds through issue of equity shares or American depository receipts or global depository receipts or foreign currency convertible bonds or non-convertible debenture (in form of bonds or otherwise) or bonds or any other securities/financial instruments, whether denominated in Indian Rupee and/or foreign currency(ies), either by way of a public issue or by way of a private placement (including through a qualified institutions placement) in accordance with the provisions of the applicable law. The fund raising would be subject to necessary permissions, sanctions and approvals (including shareholders' approval and such other statutory approvals as may be required) and the provisions of the laws.
Index heavyweight and cigarette major ITC fell 1.03% at Rs 230.70.
Axis Bank rose 0.29% at Rs 468.30 after the bank announced that its board of directors at its meeting held yesterday, 14 December 2016, approved the allotment of non-convertible debentures aggregating to Rs 3500 crore on a private placement basis. The debentures will be listed on the wholesale debt market segment of the BSE and National Stock Exchange of India. The announcement was made after market hours yesterday, 14 December 2016.
Infosys was up 0.62% at Rs 1,005.20 after the company announced that it has made an investment from its Innovation Fund in IdeaForge, an Indian startup focused on Unmanned Aerial Vehicle (UAV) solutions. IdeaForge's high performance UAVs, which have been designed and built in India, have significant potential in industrial use cases. The investment is subject to receipt of regulatory approvals and customary closing conditions. The announcement was made after market hours yesterday, 14 December 2016.
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