Losses for index heavyweight Infosys and shares of oil exploration and production companies offset gains for automobile stocks and index heavyweight ITC to push key benchmark indices lower for the second day in a row. The barometer index, the S&P BSE Sensex, dropped 57.58 points or 0.21% to settle at 26,846.53. The 50-unit CNX Nifty shed 11.90 points or 0.15% to settle at 8,131.70. IT major Infosys extended previous trading session's losses triggered by the company lowering its full year revenue growth guidance in dollar terms. Metal and mining stocks witnessed a mixed trend after weak Chinese trade data.
Key indices witnessed volatility in intraday trade. After languishing in red earlier during the trading session, the Sensex and the Nifty erased almost entire losses in early afternoon trade. But, weakness in European stocks pulled the Sensex and the Nifty to their lowest level in more than a week in mid-afternoon trade. Intraday recovery in index heavyweights HDFC and Reliance Industries (RIL) helped key indices once again trim losses at the fag end of the trading session.
The Sensex and the Nifty edged lower for the second day in a row. The Sensex dropped 57.58 points or 0.21% to settle at 26,846.53, its lowest closing level since 8 October 2015. The barometer index dropped 185.01 points or 0.68% at the day's low of 26,719.10 in mid-afternoon trade, its lowest level since 5 October 2015. The Sensex gained 14.41 points or 0.05% at the day's high of 26,918.52 at the onset of the trading session.
The Nifty shed 11.90 points or 0.15% to settle at 8,131.70, its lowest closing level since 8 October 2015. The Nifty shed 55 points or 0.67% at the day's low of 8,088.60, in mid-afternoon trade, its lowest level since 5 October 2015. The index gained 6.65 points or 0.08% at the day's high of 8,150.25 at the onset of the trading session.
The market breadth indicating the overall health of the market was positive. On BSE, 1,538 shares rose and 1,229 shares declined. A total of 106 shares were unchanged. The BSE Mid-Cap index rose 0.02%. The BSE Small-Cap index gained 0.41%. Both these indices outperformed the Sensex.
The total turnover on BSE amounted to Rs 2766 crore, higher than turnover of Rs 2390.13 crore registered during the previous trading session.
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Among the sectoral indices on BSE, the S&P BSE Bankex (down 0.19%), the S&P BSE Metal index (up 0.08%), the S&P BSE Power index (up 0.29%), the S&P BSE Consumer Durables index (down 0.08%), the S&P BSE FMCG index (up 0.14%), the S&P BSE Realty index (up 1.31%), the S&P BSE Auto index (up 0.02%) and the S&P BSE Healthcare index (down 0.07%), outperformed the Sensex. The S&P BSE IT index (down 1.03%), the S&P BSE Teck index (down 0.87%), the S&P BSE Oil & Gas index (down 0.56%), and the S&P BSE Capital Goods index (down 0.21%) underperformed the Sensex.
Realty stocks rose on renewed buying. Sobha (up 1.38%), Indiabulls Real Estate (up 1.51%), Omaxe (up 0.07%), Unitech (up 1.48%), Housing Development & Infrastructure (HDIL) (up 3.17%), Oberoi Realty (up 2.02%) and DLF (up 0.66%) edged higher.
Shares of PSU banks edged lower. State Bank of India (down 0.45%), Bank of India (down 1.15%), Union Bank of India (down 1.02%), Indian Overseas Bank (down 0.93%), Punjab National Bank (down 0.73%), Bank of Baroda (down 0.4%), Oriental Bank of Commerce (down 0.4%), Andhra Bank (down 1.14%) and Corporation Bank (down 0.44%) edged lower. Syndicate Bank (up 2.89%) and Canara Bank (up 0.49%) edged higher. Vijaya Bank was flat at Rs 36.
IDBI Bank rose 0.06%. With respect to news titled "Vijay Mallya faces CBI heat over loan fraud", IDBI Bank clarified after market hours yesterday, 12 October 2015, that the bank does not have any official communication from the Central Bureau of Investigation (CBI) in the matter. There is no price sensitive angle to the matter as the matter is not new and has been probed by the CBI earlier also and relates to the normal business activities of the bank and other consortium lender banks, it said. IDBI has been and will be continuing to extend full assistance to CBI in any enquiry in the matter, the bank added. IDBI Bank is one of the 17 consortium lenders to Kingfisher Airlines (KAL). KAL had defaulted in its payment obligations to the banks and banks have jointly taken several recovery actions against the promoter and the company.
Shares of private sector banks were mixed. Axis Bank (up 0.77%) and IndusInd Bank (up 0.26%) edged higher. HDFC Bank (down 0.47%), ICICI Bank (down 0.1%) and Kotak Mahindra Bank (down 0.9%) edged lower.
Yes Bank rose 1.33% after the bank announced during market hours today, 13 October 2015, that it has become the first Indian bank to be selected as an index component of the Dow Jones sustainability indices in the Emerging Markets Index.
Most auto stocks gained. Mahindra & Mahindra (M&M) (up 0.44%), Ashok Leyland (up 0.32%), Bajaj Auto (up 1.3%) and TVS Motor Company (up 1.47%) gained. Eicher Motors (down 0.92%), Hero MotoCorp (down 0.63%) and Tata Motors (down 0.4%) declined.
Maruti Suzuki India rose 1.02%. The company after market hours today, 13 October 2015, announced the opening of pre-launch bookings for its premium passenger car Baleno. The car is slated for launch by the end of the month.
Index heavyweight and cigarette major ITC rose 1.36% at Rs 345.35. The stock hit a high of Rs 346 and a low of Rs 340.80 in intraday trade.
Index heavyweight and housing finance firm HDFC rose 0.42% at Rs 1,277.50. The stock hit a high of Rs 1,280.90 and a low of Rs 1,264.30 in intraday trade.
Metal and mining stocks witnessed a mixed trend after weak Chinese trade data. Tata Steel (down 2.59%), Vedanta (down 2.93%) and Hindalco Industries (down 3.21%) edged lower. Hindustan Zinc (up 3.48%), Jindal Steel & Power (up 1.93%), National Aluminium Company (up 1.63%), JSW Steel (up 1.33%), NMDC (up 0.15%) and Steel Authority of India (up 0.09%) edged higher. China is the world's largest consumer of steel, copper and aluminum.
China's September exports continued to struggle against weak global demand. Exports fell 3.7% in September 2015 from a year earlier in US dollar terms following a 5.5% drop in August 2015. Imports fell 20.4% in September 2015 compared with a 13.8% decrease in August 2015.
Shares of state-run coal mining giant Coal India were up 2% at Rs 341.20.
Shares of public sector oil marketing companies (PSU OMCs) edged higher on lower crude oil prices. BPCL (up 1.58%), HPCL (up 0.92%) and Indian Oil Corporation (up 0.25%) edged higher.
Decline in crude oil prices could reduce under-recoveries of PSU OMCs on domestic sale of LPG and kerosene at government controlled prices. However, a weakness in rupee against the dollar will restrict the benefit of falling global crude oil prices to that extent. A weak rupee raises the cost of imports. The government has already decontrolled pricing of petrol and diesel.
In global commodities markets, Brent for November settlement was currently up 27 cents at $50.13 a barrel. The contract had slumped $2.79 a barrel or 5.29% to settle at $49.86 a barrel during the previous trading session. The Brent November contract is to expire on 15 October 2015. Brent for December settlement was currently down 11 cents at $50.14 a barrel.
In the foreign exchange market, the partially convertible rupee was currently hovering at 65.155, compared with its close of 64.755 during the previous trading session.
Shares of oil exploration and production (E&P) firms dropped along with decline in crude oil prices. ONGC (down 3.68%), Cairn India (down 1.85%) and Oil India (down 0.1%) declined. Lower crude oil prices will decrease realizations from crude sales for oil exploration firms.
Index heavyweight Reliance Industries was up 0.06%. The stock hit a high of Rs 895 and a low of Rs 883 in intraday trade.
Telecom stocks were mixed. Idea Cellular (down 3.68%) and Bharti Airtel (down 1.56%) edged lower. Reliance Communications (up 3.94%) edged higher.
Infosys lost 2.35% at Rs 1,096.10, with the stock extending previous trading session's decline triggered by the company lowering its full year revenue growth guidance in dollar terms at the time of announcement of Q2 September 2015 results. The stock had fallen 3.88% to settle at Rs 1,122.50 yesterday, 12 October 2015. Infosys now expects its revenue to grow 6.4%-8.4% in dollar terms for the year ending 31 March 2016 (FY 2016). At the time of announcing Q1 June 2015 results, Infosys had forecast revenue growth of 7.2%-9.2% in dollar terms for FY 2016. The revenue growth guidance for FY 2016 has been kept unchanged at 10%-12% in constant currency terms.
Key indices dropped for the second day in a row today, 13 October 2015. The Sensex has declined 232.98 points or 0.86% in the preceding two sessions from a recent high of 27,079.51 on 9 October 2015. The Sensex has risen 691.70 points or 2.64% in this month so far (till 13 October 2015). The Sensex has fallen 652.89 points or 2.37% in this calendar year so far (till 13 October 2015). From a 52-week low of 24,833.54 hit on 8 September 2015, the Sensex has risen 2,012.99 points or 8.1%. The Sensex is off 3,178.21 points or 10.58% from a record high of 30,024.74 hit on 4 March 2015.
On the macro front, the latest data showed acceleration in consumer price inflation in September 2015, mainly due to increase in vegetable prices. Another data showed that a surge in production of two items contributed to more than half of the 6.4% increase in industrial production in August 2015. Inflation based on the consumer price index (CPI) increased to 4.4% in September 2015 from with 3.7% in August 2015. The core CPI inflation rose to 4.1% in September 2015 from 3.9% in August 2015. Growth in industrial production (IIP) hit its highest level in almost three years on the back a surge in the output of the manufacturing sector. Gems and jewellery and rubber insulated cables contributed to more than half of the 6.4% increase in industrial production in August 2015.
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