Key benchmark indices extended losses and hit fresh intraday low in morning trade. At 10:20 IST, the barometer index, the S&P BSE Sensex was down 144.02 points or 0.51% at 28,035.06. The Nifty 50 index was currently down 39.85 points or 0.46% at 8,669.10. Weakness in most Asian stocks weighed on sentiment.
In overseas stock markets, most Asian stocks declined following the release of data pointing to a South Korean slowdown. South Korea gross domestic product grew 2.7% year-on-year in the third quarter, down from a 3.3% gain in the prior three-month period, according to preliminary data from the Bank of Korea.
US stocks rose yesterday, 24 October 2016, on flurry of M&A deals, part of the single largest week for M&A since the dot-com era. More than five multi-billion dollar deals were announced over the past week. Latest data showed that the Markit flash US manufacturing purchasing managers' index rose to 53.2 in October from 51.5 in September.
Closer home, the market breadth indicating the overall health of the market was negative. On BSE, 1,213 shares fell and 873 shares rose. A total of 128 shares were unchanged. The BSE Mid-Cap index was currently down 0.54%. The decline in this index was higher than the Sensex's decline in percentage terms. The BSE Small-Cap index was currently down 0.28%. The decline in this index was lower than the Sensex's decline in percentage terms.
Shares of Tata Group companies fell after Tata Sons, the holding company of the Tata Group, said its board of directors replaced Cyrus P. Mistry as chairman of Tata Sons. Tata Metaliks (down 4.06%), Tata Steel (down 2.52%), Tata Communications (down 2.81%), Tata Global Beverages (down 2.34%), Tata Chemicals (down 3%), Tata Motors (down 0.3%), Tata Investment Corporation (down 1.62%), Tata Power (down 1.79%), Tinplate Company of India (down 1.73%), Tata Sponge Iron (down 1.67%), Rallis India (down 0.7%), and Tata Coffee (down 1.97%), edged lower. The decision was taken at a board meeting held yesterday, 24 October 2016. The board named Ratan N. Tata as interim chairman of Tata Sons. The board has constituted a selection committee to choose a new chairman. The committee comprises Ratan N. Tata, Venu Srinivasan, Amit Chandra, Ronen Sen and Lord Kumar Bhattacharyya, as per the criteria in the Articles of Association of Tata Sons. The committee has been mandated to complete the selection process in four months. The announcement was made after market hours yesterday, 24 October 2016.
Tata Sons is the promoter of the major operating Tata companies and holds significant shareholdings in these companies. About 66% of the equity capital of Tata Sons is held by philanthropic trusts endowed by members of the Tata family. The largest of these trusts are the Sir Dorabji Tata Trust and the Sir Ratan Tata Trust, which were created by the families of the sons of Jamsetji Tata, the Founder.
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Telecom stocks declined. Reliance Communications (RCom) fell 0.42%. MTNL dropped 0.25%.
Bharti Airtel declined 1.03% ahead of its Q2 results today, 25 October 2016.
Shares of Bharti Infratel rose 1.78% after the company announced good Q2 results. The company's consolidated net profit rose 30.79% to Rs 773.80 crore on 8.98% rise in total income to Rs 1515 crore in Q2 September 2016 over Q2 September 2015. The result was announced after market hours yesterday, 24 October 2016. Bharti Infratel is a provider of tower and related infrastructure and is a unit of Bharti Airtel.
Idea Cellular dropped 1.3% after the company reported weak Q2 results. On a consolidated basis, net profit of Idea Cellular declined 88% to Rs 91.46 crore on 7.23% rise in net sales to Rs 9298.89 crore in Q2 September 2016 over Q2 September 2015. Idea Cellular reported net loss of Rs 42.79 crore in Q2 September 2016 as against net profit of Rs 739.59 crore in Q2 September 2015. Net sales rose 6.78% to Rs 9223.78 crore in Q2 September 2016 over Q2 September 2015. The result was announced after market hours yesterday, 24 October 2016.
Adani Enterprises shed 4.13% after consolidated net profit fell 78.87% to Rs 63.09 crore on 18.49% decline in total income to Rs 7770.59 crore in Q2 September 2016 over Q2 September 2015. The result was announced after market hours yesterday, 24 October 2016. Ameet Desai, Executive Director of Adani Enterprises and Group CFO said that this has been a good quarter with recurring financial performance despite multiple headwinds including market volatility for commodities. The company has well-rounded growth in volume at its mining, agro and city gas businesses during the quarter. With improving economic climate and business sentiment, the company expects to further boost its financial performance, Desai said.
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