Key benchmark indices tumbled and hit fresh intraday low in mid-afternoon trade as a steep slide in rupee which took it to record low against the dollar rattled investor sentiment. The S&P BSE Sensex hit its lowest level in nearly six weeks. The 50-unit CNX Nifty hit 16-week low. The Sensex was down 368.35 points or 1.92%, off close to 320 points from the day's high and up about 20 points from the day's low. The market breadth, indicating the overall health of the market, was weak.
Tata Power Company tumbled and hit 52-week low after the company reported reverse turnaround in Q1 June 2013. Bank stocks extended intraday losses, with State Bank of India hitting a 52-week low. Steel major Tata Steel also hit 52-week low.
The market edged lower in early trade on weak Asian stocks. The Sensex extended initial losses to hit fresh intraday low in morning trade as the rupee hit record low against the dollar. The market weakened further to hit fresh intraday low in mid-morning trade. The Sensex fell below the psychological 19,000 mark. Weakness continued on the bourses in early afternoon trade. The Sensex slumped to hit fresh intraday low in mid-afternoon trade.
The rupee weakened to hit record low against the dollar today, 6 August 2013, as stronger growth in US service industries fueled speculation the Federal Reserve will soon be able to reduce economic stimulus to the US economy. The rupee was hovering at 61.65, sharply lower than Monday's close of 60.88/89.
Bond prices fell. The yield on the benchmark government paper 7.16 GS 2023 was at 8.2721%, higher than Monday's close of 8.2015%. Bond yield and bond prices are inversely related.
At 14:20 IST, the S&P BSE Sensex was down 368.35 points or 1.92% to 18,813.91. The index lost 386.93 points at the day's low of 18,795.33 in mid-afternoon trade, its lowest level since 27 June 2013. The index declined 50.34 points at the day's high of 19,131.92 in early trade.
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The CNX Nifty was down 117.05 points or 2.06% to 5,569.35. The index hit a low of 5,565.85 in intraday trade, its lowest level since 16 April 2013. The index hit a high of 5,664.90 in intraday trade.
The market breadth, indicating the overall health of the market, was weak. On BSE, 1,523 shares fell and 527 shares rose. A total of 141 shares were unchanged.
Among the 30-share Sensex pack, 24 stocks fell and rest of them rose. Sterlite Industries (down 5.98%), Bhel (down 4.92%) and Bharti Airtel (down 4.71%), edged lower.
Steel major Tata Steel dropped 4.52% to Rs 198.30 after hitting a 52-week low of Rs 197.50 in intraday trade today, 6 August 2013.
Bank stocks extended intraday losses. HDFC Bank declined 3.9%. ICICI Bank dropped 3.33%.
Among PSU bank stocks, Canara Bank, Union Bank of India, Bank of India, Bank of Baroda and Punjab National Bank shed by 1.39% to 7.39%.
State Bank of India declined 1.46% to Rs 1657.75 after hitting a 52-week low of Rs 1650.05 in intraday trade today, 6 August 2013.
Tata Power Company tumbled 9.5% to Rs 75.50 after the company reported reverse turnaround in Q1. The stock hit 52-week low of Rs 75.30 in intraday trade today, 6 August 2013. The company reported a consolidated net loss of Rs 114.70 crore in Q1 June 2013, compared with net profit of Rs 145.93 crore in Q1 June 2012. The company's total income rose 24.53% to Rs 9111.57 crore in Q1 June 2013 over Q1 June 2012. The company announced Q1 result during market hours today, 6 August 2013.
Economic output in emerging economies contracted in July to its slowest pace since April 2009, marking a fresh low since the global financial crisis, according to HSBC Holdings PLC. The HSBC Emerging Markets Index, which tracks purchasing managers' index reports from 16 emerging economies, declined to 49.4 in July from 50.6 the previous month, HSBC said in a report. A reading above 50 indicates an expansion in activity.
European indices were mostly lower on Tuesday, 6 August 2013, with comments from Dallas Fed chief Richard Fisher bringing the topic of the US central bank scaling back its $85 billion-a-month bond-buying program back into the spotlight. Key benchmark indices in Germany and UK were down by 0.04% to 0.18%. France's CAC 40 was up 0.28%.
Most Asian stocks fell on Tuesday, 6 August 2013, as stronger growth in American service industries fueled speculation the US Federal Reserve will soon be able to reduce economic stimulus. Key benchmark indices in Hong Kong, Taiwan, Singapore, and South Korea were off 0.50% to 1.34%. Key benchmark indices in China and Japan rose by 0.49% and 1%, respectively.
Australia's central bank cut its benchmark interest rate to a record low and damped expectations of further reductions. Governor Glenn Stevens and his board reduced the overnight cash-rate target by a quarter percentage point to 2.5%, the Reserve Bank of Australia said in a statement in Sydney today.
Trading in US index futures indicated a flat opening of US stocks on Tuesday, 6 August 2013. Most US stocks fell on Monday, 5 August 2013, with benchmark indices pulling away from record highs, as Wall Street considered a report indicating better-than-expected growth in the service sector and a Federal Reserve official's remarks that the central bank is closer to curbing its asset purchases. Dallas Federal Reserve Bank President Richard Fisher on Monday, 5 August 2013, said the fall in the US unemployment rate to 7.4% in July means the Fed is closer to slowing its asset purchases from $85 billion a month.
The Institute for Supply Management's non-manufacturing index for the US rose to 56 in July, beating the median estimate and June's 52.2 reading.
The US central bank currently buys $85 billion a month in US debt and mortgage-backed securities. Federal Reserve Chairman Ben Bernanke has on several occasions stressed that the tapering process is dependent on an improvement in data. Fed's bond-buying program has kept global markets flush with liquidity in recent years.
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