Key benchmark indices reversed intraday gains and hit fresh intraday low in late trade with the market sentiment hit adversely after the rupee hit record low below 60 against the dollar. The S&P BSE Sensex was provisionally down 109.33 points or 0.59%, off 170.68 points from the day's high and up 5.47 points from the day's low. The market breadth, indicating the overall health of the market, was negative. Also hitting market sentiment was data showing that foreign institutional investors (FIIs) remained net sellers of Indian stocks on Tuesday, 25 June 2013.
Index heavyweight and cigarette major ITC pared gains in late trade. Reliance Industries (RIL) reversed intraday gains and slipped into the red in late trade. Bharti Airtel dropped on reports the Department of Telecom (DoT) has decided to slap a Rs 650-crore penalty on the company for violating roaming norms in 13 circles between 2003-2005. Auto stocks were mostly lower. IT stocks rose on positive economic data in the US, the biggest outsourcing market for the Indian IT firms.
In the currency market, the rupee breached the 60-mark against dollar and touched all-time low in the mid-session trading on higher demand from banks and importers and heavy outflows by foreign institutional investors. The rupee was hovering at 60.53 against the dollar, weaker than Tuesday's close of 59.66/67. A weak rupee makes the cost of oil and other imported goods higher in rupee terms, adding to inflationary pressure.
Key benchmark indices edged higher in early trade on mostly positive Asian stocks. The market pared gains in morning trade. A bout of volatility was witnessed as key benchmark indices regained positive zone after sliding into the red in mid-morning trade. Key benchmark indices hovered in positive zone within a narrow range in early afternoon trade. The Sensex was slightly higher in afternoon trade. Key benchmark indices hovered in positive zone after moving in a narrow range in mid-afternoon trade. Key benchmark indices reversed intraday gains and hit fresh intraday low in late trade with the market sentiment hit adversely after the rupee hit record low below 60 against the dollar.
The market may remain volatile tomorrow, 27 June 2013, as traders roll over positions in the futures & options (F&O) segment from the near month June 2013 series to July 2013 series. The June 2013 F&O contracts expire tomorrow, 27 June 2013.
The market sentiment was hit adversely by data showing that foreign funds remained net sellers of Indian stocks on Tuesday, 25 June 2013. Foreign institutional investors (FIIs) sold shares worth a net Rs 1285.86 crore on Tuesday, 25 June 2013, as per provisional data from the stock exchanges.
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As per provisional closing, the S&P BSE Sensex was down 109.33 points or 0.59% to 18,519.82. The index gained 61.35 points at the day's high of 18,690.50 in morning trade. The index fell 114.80 points at the day's low of 18,514.35 in late trade.
The CNX Nifty was down 27.85 points or 0.5% to 5,581.25. The index hit a high of 5,635.25 in intraday trade. The index hit a low of 5,579.35 in intraday trade.
The market breadth, indicating the overall health of the market, was negative. On BSE, 1,394 shares declined and 981 shares rose. A total of 146 shares were unchanged.
The total turnover on BSE amounted to Rs 1483 crore, lower than Rs 1930 crore on Tuesday, 25 June 2013.
Among the 30-share Sensex pack, 20 stocks declined and rest of them gained. Jindal Steel & Power (down 3.44%), Hindalco Industries (down 2.38%) and HDFC Bank (down 2.25%) edged lower from the Sensex pack.
Index heavyweight and cigarette major ITC rose 0.83% to Rs 322.85. The stock hit a high of Rs 326.80 and low of Rs 318.95.
Reliance Industries (RIL) shed 0.32% at Rs 801.20. The stock hit a high of Rs 814.55 and low of Rs 800.85. As per reports, the Cabinet Committee on Economic Affairs (CCEA) will consider a proposal this week for a steep hike in natural gas prices. The CCEA last week deferred a decision on a proposal to hike natural gas prices as Oil Minister M Veerappa Moily was away on an official tour. The oil ministry has proposed an increase in gas prices to $6.775 million British thermal unit (mbtu) from current $4.2 mbtu. The Oil Ministry has proposed raising gas price for state-run firms immediately and that for Reliance Industries (RIL) from April 2014 when it is contractually due.
Auto stocks were mostly lower. Bajaj Auto fell 0.29% to Rs 1,794.70, off day's low of Rs 1,764. The company after market hours on Tuesday, 25 June 2013 said workmen at its Chakan plant in Pune have stopped coming to work. Bajaj Auto said the workers had earlier given a notice for a stoppage of work at the plant from the morning shift of 28 June 2013. The reason for the strike was that management had refused to concede their demand that all the workmen working in Bajaj Auto should each be given an option to subscribe to 500 equity shares of the company at a discounted price of Re 1 per share, Bajaj Auto added. The workmen have, however, stopped coming to the Chakan plant from 25 June 2013, itself, without assigning any reason for this stoppage, the company said in a filing.
Hero MotoCorp surged 4.19%. Maruti Suzuki India rose 0.2%.
M&M (down 4.85%) and Tata Motors (down 3.34%) declined.
IT stocks rose on positive economic data in the US, the biggest outsourcing market for the Indian IT firms. TCS (up 3.41%), Infosys (up 1.14%) and Wipro (up 1.1%), edged higher.
Rupee's weakness also aided gains in IT stocks. The rupee hit record low below 60 versus the dollar today, 26 June 2013. The rupee was hovering at 60.53 against the dollar, weaker than Tuesday's close of 59.66/67. A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports.
Bharti Airtel tumbled 6.03% to Rs 277.60 on reports the Department of Telecom (DoT) has decided to slap a Rs 650 crore penalty on Bharti Airtel for violating roaming norms in 13 circles between 2003-2005. It was the top loser from the Sensex pack.
NTPC gained 1.99%. Coal India fell 1.86%. Reportedly NTPC has resolved its public spat with Coal India over quality and payment terms and agreed to sign fuel-supply agreement (FSA) with the state-run coal major. NTPC had earlier publicly challenged Coal India on various issues, particularly the quality of coal supplied, and said it would make payments only on the basis of quality of the fuel supplied. NTPC accounts for more than 35% of the quantity that Coal India supplies under the new FSAs. As per reports, Coal India's board is scheduled to consider the fuel pact at a meeting today, 26 June 2013, after which the final agreement will be signed.
Lupin shed 1.96%. The company during market hours today said that the company's board of directors has approved the increase in the limit of investments by foreign institutional investors (FIIs) in the equity share capital of the company from 33% to 49%.
Asian Paints rose 3.47%. The company during market hours today said that it has fixed 31 July 2013 as the record date for 10-for-1 stock split.
Market regulator Securities & Exchange Board of India (Sebi) on Tuesday approved changes to buyback of shares or other specified securities from the open market through stock exchange mechanism as part of its constant endeavour to align regulatory requirements with the changing market realities as well as to enhance efficiency of the buy-back process.
Sebi said after a board meeting that the mandatory minimum buy-back has been increased to 50% of the amount earmarked for the buy-back, as against existing 25%, failing which amount in the escrow account would be forfeited subject to a maximum of 2.5% of the total amount earmarked. The maximum buy-back period has been reduced to 6 months from 12 months, it added.
Sebi's new rules will require companies to not raise further capital for a period of one year from the closure of the buy-back except in discharge of subsisting obligations as against the existing 6 months. The company shall not make another buy-back offer within a period of one year from the date of closure of the preceding offer. The companies can buy-back 15% or more of capital (paid-up capital and free reserves) only by way of tender offer, it added.
Approving a Sebi committee report on the rationalization of foreign investment routes, Sebi also introduced uniform entry norms for existing foreign institutional investors (FIIs), sub-accounts and qualified foreign investors (QFIs) and combined these entities under a category known as foreign portfolio investors (FPIs).
In another key move, the regulator approved the proposal to put in place a single self-regulatory organization (SRO) for mutual fund distributors. In order to speed up the process, Sebi decided to have a cut-off time for accepting applications from potential SROs.
European stocks edged higher on Wednesday, 26 June 2013, as positive sentiment from the US on the back of upbeat data encouraged investors to move into the stock market. Key benchmark indices in France, Germany and UK rose by 0.88% to 1.5%.
French gross domestic product contracted in the first quarter of the year, confirming the euro-zone's second largest economy succumbed to the recession in the wider euro zone, statistics showed Wednesday.
France's economy contracted 0.2% in the first quarter from the previous quarter, when GDP fell 0.2%, statistics agency Insee said. Through 2009, France posted weak or negative GDP, but had avoided recession defined as two consecutive quarters of economic contraction.
Asian stocks edged higher to reverse a four-day losing streak on Wednesday, 26 June 2013, as investors took comfort from firm US data underscoring an American recovery, and assurances from China's central bank to provide funds to institutions if needed. Key benchmark indices in Hong Kong, South Korea, Indonesia, Taiwan and Singapore were up by 0.16% to 3.82%. China's Shanghai Composite index fell 0.41%, extending recent losses on fears of a credit crunch and slower loan growth. Japan's Nikkei 225 index shed 1.04%.
Trading in US index futures indicated that the Dow could advance 42 points at the opening bell on Wednesday, 26 June 2013. US stocks rose sharply on Tuesday cheered by upbeat economic data showing increases in durable-goods orders, new-home sales and consumer confidence.
The Commerce Department said orders for goods built to last at least three years rose 3.6% in May. Another report from the Commerce Department indicated new-home sales rising 2.1% last month. Separately, the S&P/Case-Shiller index of home values rose 12.1% in April from a year earlier, the biggest jump in more than seven years. The Conference Board's consumer-confidence index rose to 81.4 in June from 74.3 in May.
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