Key benchmark indices continued to hover in negative terrain in afternoon trade, with investor sentiment hit adversely on data showing that foreign institutional investors (FIIs) remained net sellers of Indian stocks on Friday, 21 June 2013. The barometer index, the S&P BSE Sensex, was down 150.26 points or 0.8%, off close to 90 points from the day's high and up about 40 points from the day's low. The market breadth, indicating the overall health of the market, was weak.
Shares of oil exploration firms declined as crude oil prices fell. Shares of Jaypee Group companies slumped. ICICI Bank and housing finance major HDFC, both, reversed initial losses and moved into positive zone after the Reserve Bank of India on Friday, 21 June 2013, reduced the risk weightage on home loans and residential housing projects. Shares of India's largest power equipment maker by capacity Bhel extended intraday losses to hit fresh 52-week low.
Key benchmark indices edged lower in early trade on weak Asian stocks. Key benchmark indices dropped to fresh intraday low in morning trade. The Sensex and Nifty, both, hit their lowest level in almost 10 weeks. Fresh selling derailed a brief recovery in mid-morning trade. A setback in mainland Chinese stocks hit investor sentiment as key benchmark indices hovered in red in afternoon trade. The Sensex continued to hover in negative terrain in afternoon trade.
The market may remain volatile this week 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 on Thursday, 27 June 2013.
The market sentiment was hit adversely after data showed that foreign funds remained net sellers of Indian stocks on Friday, 21 June 2013. Foreign institutional investors (FIIs) sold shares worth a net Rs 1768.60 crore on Friday, 21 June 2013, as per provisional data from the stock exchanges.
At 13:20 IST, the S&P BSE Sensex was down 150.26 points or 0.8% to 18,623.97. The index declined 191.69 points at the day's low of 18,582.55 in morning trade, its lowest level since 16 April 2013. The index fell 60.18 points at the day's high of 18,714.06 in opening trade.
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The CNX Nifty was down 49.75 points or 0.88% to 5,617.90. The index hit a low of 5,602.25 in intraday trade, its lowest level since 16 April 2013. The index hit a high of 5,640 in intraday trade.
The market breadth, indicating the overall health of the market, was weak. On BSE, 1,433 shares declined and 544 shares rose. A total of 118 shares were unchanged.
Among the 30-share Sensex pack, 21 declined and rest of them gained. GAIL (India) (down 2.86%), Sterlite Industries (down 2.54%) and L&T (down 2.49%), edged lower. Tata Power Company (up 1.47%), Sun Pharmaceutical Industries (up 1.07%) and NTPC (up 0.45%), edged higher.
ICICI Bank was up 0.74%, with the stock reversing initial losses. The stock came off the day's low of Rs 1,029.50.
HDFC was up 0.55%, with the stock reversing initial losses. The stock came off the day's low of Rs 810.
In a move to boost the real estate sector, the Reserve Bank of India on Friday, 21 June 2013, reduced the risk weightage on home loans and residential housing projects. RBI said the risk weightage on housing loans up to Rs 75 lakh has been brought down to 50% from the earlier requirement of 75%. On home loans above Rs 75 lakh, the risk weight has been brought down to 75% from 100% earlier. Risk weight to residential housing projects under commercial real estate (CRE) too has been brought down to 75% from the previous requirement of 100%.
India's largest power equipment maker by capacity Bhel fell 3.11% to Rs 165.35 after hitting a 52-week low of Rs 165.10 in intraday trade today, 24 June 2013.
Oil exploration stocks declined as crude oil prices fell. Cairn India (down 3.04%), ONGC (down 1.62%) and Oil India (down 1.37%), edged lower. US crude oil futures for August 2013 delivery were down 0.89% a barrel at $92.86 a barrel in the electronic trading today, 24 June 2013. US crude oil futures for August 2013 delivery settled 1.5% lower at $93.69 a barrel Friday, 21 June 2013. Lower crude oil prices would result in lower realizations from crude sales for oil exploration firms.
Shares of Jaypee Group companies slumped. Jaiprakash Power Ventures tumbled 9.31% to Rs 18.30 after hitting record low of Rs 17.30 in intraday trade today, 24 June 2013. The company before market hours today, 24 June 2013, said the generation of power from its 400 MW Vishnuprayag Hydro-power plant situated at district Chamoli in Uttarakhand has been stopped with effect from 16 June 2013 due to floods. The company said that the unprecedented floods in river Alaknanda has resulted in Force Majeure event for the power unit. While the company is taking effective steps to restore generation, assessment of damages due to the flood conditions shall be made on restoration of commutation and connectivity to Barrage site, the company said.
As prudent practice, 400 megawatt Vishnuprayag project is also covered under Industrial All Risk Insurance Policy, the company said.
Jaiprakash Associates tumbled 7.98%.
Jaypee Infratech slumped 5.26%.
Meanwhile, in the foreign currency market, the rupee came under renewed pressure against the dollar. The rupee was hovering at 59.68, lower than Friday's close of 59.27/28. The rupee had hit a record low of 59.9850 in intraday deals on Thursday, 20 June 2013, as global investors pulled out of emerging markets broadly amid concerns over the reduction of a US program that has injected billions of dollars into the global financial system.
European stock markets were mostly lower on Monday, with investors remaining cautious ahead of German business-confidence data. Key benchmark indices in France, and UK shed by 0.09% to 0.57%. Germany's DAX rose 0.18%.
Asian stocks dropped on Monday, 24 June 2013, on mounting concerns that the US Federal Reserve may start scaling back its huge monthly bond-buying plan which was aimed at keeping bond yields down and provide support to its faltering economy. Key benchmark indices in Japan, Singapore, Taiwan, Indonesia and South Korea were off 0.45% to 1.31%.
Chinese stocks tumbled as a recent spike in Shanghai interbank interest rates fueled worries about the world's second-largest economy. In mainland China, the Shanghai Composite lost 5.3% and Hong Kong's Hang Seng lost 2.27%. Short-term interbank interest rates in Shanghai, which hit record highs on Thursday, 20 June 2013, extended their drop from levels seen on Friday, 21 June 2013, but remained above the 6%-level on Monday, 24 June 2013. This fed worries that the People's Bank of China, China's central bank, may keep those rates at a high level.
The China's central bank warned Monday that the nation's banks need to strengthen their liquidity management and control liquidity risks. The statement was the first by the central bank that appeared to be aimed at banks caught in a recent liquidity crunch which sent short-term rates on the interbank market soaring, with the overnight lending rate hitting an intraday high of 30% late last week. The People's Bank of China said liquidity in the banking system is at a reasonable level. It also said banks need to maintain "stable and appropriate" credit growth and adhere to its prudent monetary policy.
Trading in US index futures indicated that the Dow could fall 50 points at the opening bell on Monday, 24 June 2013. US stocks ended mixed on Friday, 21 June 2013, as investors picked up beaten down stocks. While the Dow Junes Industrial Average and S&P 500 score small gains the tech laden Nasdaq Composite index registered small losses.
Federal Reserve Chairman Ben Bernanke said last week the central bank may start dialing down its stimulus effort if the economy achieves sustainable growth.
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