More than five losers for every gainer on BSE

Intraday recovery witnessed in early afternoon trade after a steep slide in mid-morning trade proved short lived. The barometer index, the S&P BSE Sensex, was hovering below the psychological 27,000 mark after falling below that mark earlier during the trading session. The Sensex was currently off 464.73 points or 1.7% at 26,854.83. Indian stocks fell today, 16 December 2014, amid weakness in global stocks. November trade data showing weakness on India's external front also hit sentiment on the domestic bourses adversely.

The market breadth indicating the overall health of the market was quite weak, with more than five losers for every gainer on BSE. The BSE Mid-Cap index was off 2.09%. The BSE Small-Cap index was off 2.86%. The fall in both these indices was higher than the Sensex's decline in percentage terms.

Shares of oil exploration and production (E&P) companies declined as global crude oil prices fell. Auto stocks fell on reports the government may not extend excise duty concessions to the auto sector beyond 31 December 2014.

Earlier, the Sensex had hit 7-week low and the 50-unit CNX Nifty had hit its lowest level in nearly 7 weeks in mid-morning trade amid weakness in global stocks.

Due to sharp jump in gold imports, India's trade deficit rose sharply to $16.86 billion in November 2014 from $9.57 billion in November 2013, data released by the Ministry of Commerce & Industry after trading hours yesterday, 15 December 2014, showed.

Foreign portfolio investors sold shares worth a net Rs 455.72 crore yesterday, 15 December 2014, as per provisional data.

In overseas markets, Asian stocks edged lower as oil's slump and weaker-than-estimated Chinese manufacturing stoked concern that the global economy may falter. US stocks fell yesterday, 15 December 2014, amid a continuing slump in oil prices and ahead of a closely watched Federal Reserve meeting. Investors fret that the sharp slide in global crude oil prices since June could be signaling that the global economy is slowing more quickly than data currently suggest.

In the foreign exchange market, the rupee weakened past the 63 mark against the dollar as India's trade deficit rose sharply last month due to a sharp surge in gold imports.

Brent crude futures hit 5-1/2-year low amid speculation that US oil producers may further increase output.

At 13:15 IST, the S&P BSE Sensex was down 464.73 points or 1.70% at 26,854.83. The index lost 474.02 points at the day's low of 26,845.54 in mid-morning trade, its lowest level since 28 October 2014. The index fell 120.19 points at the day's high of 27,199.37 in early trade.

The CNX Nifty was down 131.25 points or 1.60% at 8,088.35. The index hit a low of 8,082.80 in intraday trade, its lowest level since 29 October 2014. The index hit a high of 8,189.35 in intraday trade.

The BSE Mid-Cap index was off 233.18 points or 2.32% at 9,829.40. The BSE Small-Cap index was off 340.60 points or 3.10% at 10,657.31. The fall in both these indices was higher than the Sensex's decline in percentage terms.

The market breadth indicating the overall health of the market was quite weak, with more than five losers for every gainer on BSE. On BSE, 2,168 shares fell and 427 shares rose. A total of 79 shares were unchanged.

Shares of oil exploration and production companies declined as global crude oil prices fell. Cairn India (down 2.36%), ONGC (down 2.3%), Videocon Industries (off 1.89%) and Reliance Industries (down 0.17%) edged lower. Oil India, however, was up 1.79%.

Alstom T&D India fell 2.89%. The company announced during trading hours today, 16 December 2014, that it has secured an order worth about Rs 151.50 crore from Rajasthan Rajya Vidyut Prasaran Nigam (RRVPNL) to supply a 400/220 kilovolt (kV) substation in Bhadla, and expand the existing 400/220 kV substation in Bikaner. All equipment for these two projects will be manufactured and supplied from Alstom T&D India's manufacturing facilities in India.

Strides Arcolab fell 1.93% to Rs 903.90. The company announced during trading hours today, 16 December 2014, that it has received approval from the United States Food & Drug Administration (USFDA) for Calcitriol Softgel Capsules in 0.25 microgram (mcg) and 0.5 mcg strengths. Calcitriol is a Vitamin D capsule, used in patients with kidney disease who can't make enough of the active form of Vitamin D. This medication is also used to prevent and treat certain types of calcium/phosphorus/parathyroid problems that can happen with long-term kidney dialysis or hypoparathyroidism. Calcitriol is usually used along with specific diet recommendations and sometimes other medications.

According to IMS data, the US market for generic Calcitriol Softgel Capsules is approximately $50 million, with only three players having approval for both the strengths of Calcitriol. The product will be manufactured at the company's oral dosage facility at Bangalore.

Shares of automobile companies fell on media reports that excise duty concessions to the automobile sector may not continue beyond 31 December 2014. Escorts (down 2.62%), Ashok Leyland (down 2.58%), Mahindra & Mahindra (down 2.15%), Tata Motors (down 2.11%), TVS Motor Company (down 2.11%), Eicher Motors (down 1.16%), Maruti Suzuki (India) (down 1.02%), Bajaj Auto (down 0.55%) and Hero MotoCorp (down 0.47%) edged lower.

With automobile sales entering positive territory in November 2014 and the government under pressure to raise revenues, excise duty concessions to the automobile sector may not continue beyond 31 December 2014, media reports said. In February 2014, the UPA government had reduced the excuse duty on small cars, motorcycles, scooters, three wheelers and commercial vehicles from 12% to 8%; mid-segment cars from 24% to 20%; large cars from 27% to 24%; and SUVs from 30% to 24%. This was done in the wake of an unprecedented negative growth in the automobile industry. In order to provide a fillip to the automobile sector, and given its commitment to revive the economic growth, the newly elected Narendra Modi-led government on 25 June 2014, decided to extend duty concessions beyond 30 June 2014 for a period of six months upto 31 December 2014.

In the foreign exchange market, the rupee weakened past the 63 mark against the dollar as India's trade deficit rose sharply last month due to a sharp surge in gold imports. The partially convertible rupee was hovering at 63.35, compared with its close of 62.945 during the previous trading session.

Brent crude futures hit 5-1/2-year low amid speculation that US oil producers may further increase output. Brent for January settlement, which expires today, 16 December 2014, was off $1.09 a barrel at $59.97 a barrel. The contract had lost 79 cents settle at $61.06 a barrel during the previous trading session. Brent for February settlement was off $1.24 a barrel at $59.97 a barrel.

India's merchandise exports rose 7.27% to $25.96 billion in November 2014 over November 2013, data released by the Ministry of Commerce & Industry after trading hours yesterday, 15 December 2014, showed. Imports jumped 26.79% at $42.82 billion in November 2014 over November 2013. Oil imports dropped 9.7% at $11.72 billion in November 2014 over November 2013. Non-oil imports jumped 49.6% at $31.10 billion in November 2014 over November 2013. The trade deficit rose sharply to $16.86 billion in November 2014, from $9.57 billion in November 2013.

Finance Minister Arun Jaitley yesterday, 15 December 2014, said that various welfare programmes of the government for vulnerable sections of the society are essential and working well. In this regard he mentioned about food security and education for all programmes among others. The Finance Minister made those comments while speaking to the students of Stanford University, USA when they called on him in his office yesterday, 15 December 2014.

Meanwhile, investors are closely monitoring if the government's key legislative reform bills are passed during the ongoing winter session of the parliament. The government may table the constitutional amendment bill to facilitate the levy of goods & services tax (GST) during the ongoing winter session of the parliament. The constitutional amendment Bill will provide the legal framework for rolling out the levy, giving states power to tax both goods and services. As of now only the central government can impose service tax. The amendment Bill will also create a GST council, a body that will have representatives of the states and the Centre that will take decisions on the tax after it is rolled out.

The government's intension is to implement a nationwide GST from 1 April 2016. GST is a major indirect tax reform. GST will subsume central indirect taxes such as excise duty and service tax at the central level and value added tax at the state level besides other local levies such as octroi and entry tax.

Meanwhile, the Indian government intends to get the Insurance Laws (Amendment) Bill, 2008 passed in both the Houses of Parliament in this week. The Union Cabinet, last week, approved the official amendments to the Insurance Laws (Amendment) Bill, 2008. The Parliamentary Select Committee in its report tabled in Rajya Sabha on 10 December 2014 agreed a composite cap of 49% on foreign investment in the insurance sector, which includes all types of foreign investment as opposed to the 26% foreign direct investment (FDI) allowed at present. Finance Minister Arun Jaitley had said in his maiden budget speech in July that the composite cap in the insurance sector should be increased to 49% from the current level of 26%, with full Indian management and control.

It also remains to be seen if the government will be to find support for the Coal Mines (Special Provisions) Bill, 2014 in the Rajya Sabha where it's in a minority. The Lok Sabha last week passed the Coal Mines (Special Provisions) Bill, 2014. The bill allows the government to enforce rules and guidelines for auction/allocation of 204 coal blocks cancelled by the Supreme Court in September this year.

Asian stocks edged lower today, 16 December 2014, as oil's slump and weaker-than-estimated Chinese manufacturing stoked concern that the global economy may falter. Key indices in Hong Kong, Singapore, Indonesia, South Korea, Taiwan, and Japan were off 0.39% to 2.01%. China's Shanghai Composite rose 2.31%.

China's flash manufacturing purchasing managers' index (PMI) from HSBC Holdings Plc and Markit Economics fell to 49.5 for December, from 50 last month. It's the first time since May that the gauge has slipped below 50, the threshold between expansion and contraction. The preliminary reading, which is usually issued about one week before the final PMI reading, was released more than two weeks before the final estimate for December due to the year-end holidays. The final reading is due on 2 January 2015.

In Indonesia, the country's Finance Minister Bambang Brodjonegoro will reportedly meet Bank Indonesia and financial regulator Otoritas Jasa Keuangan today, 16 December 2014, to discuss a policy response to the weakening currency.

Meanwhile, heavily armed Australian police reportedly stormed a Sydney cafe early on Tuesday morning and freed hostages being held there at gunpoint, in a dramatic end to a 16-hour siege in which two captives and the attacker were killed.

Trading in US index futures indicated that the Dow could gain 20 points at the opening bell today, 16 December 2014. US stocks fell Monday, 15 December 2014, amid a continuing slump in oil prices and ahead of a closely watched Federal Reserve meeting.

Among economic data, US manufacturing output recorded its largest increase in nine months in November as production expanded across the board, pointing to underlying strength in the economy. Factory production rose 1.1% after advancing 0.4% in October, the Federal Reserve said on Monday.

A two-day meeting of Federal Open Market Committee (FOMC) to discuss monetary policy review begins today, 16 December 2014. The policy meeting will be keenly watched for any hints on the timing of interest rate increases in the world's biggest economy. It remains to be seen whether Federal Reserve officials would signal a rate hike by dropping their assurance that rates will stay low for a considerable time.

Meanwhile in Russia, the nation's central bank unexpectedly raised its benchmark interest rate to 17% from 10.5% yesterday, 15 December 2014, its biggest step yet to shore up the ruble and defuse the currency crisis threatening the country's stricken economy.

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