Key benchmark indices extended losses to hit fresh intraday low in early afternoon trade as data showing a muted 2% growth in industrial production in April 2013 and weakness in Asian stocks hit investor sentiment adversely. The S&P BSE Sensex hit over 7-week low below the psychological 19,000 mark. The 50-unit CNX Nifty hit its lowest level in nearly 8 weeks. The Sensex was down 145.55 points or 0.76%, off close to 140 points from the day's high and up about 5 points from the day's low. The market breadth, indicating the overall health of the market, was weak.
Shares of power generation and power distribution firms edged lower in weak market. Auto stocks edged lower. Realty stocks edged higher on renewed buying. Index heavyweight Reliance Industries (RIL) reversed intraday gains. Jindal Steel & Power rose on bargain hunting amid volatility after Tuesday's 15.18% losses triggered by media reports the Central Bureau of Investigation (CBI) has registered an FIR against Congress MP and company's Chairman Naveen Jindal in the coal scam case.
The market edged lower in early trade. A bout of volatility was witnessed as the Sensex trimmed intraday losses in morning trade. The market hit fresh intraday low in mid-morning trade. The market extended losses to hit fresh intraday low in early afternoon trade. The Sensex hit over 7-week below the psychological 19,000 mark. The CNX Nifty hit its lowest level in nearly 8 weeks.
The market sentiment was affected adversely by data showing that foreign funds remained net sellers of Indian stocks on Tuesday, 11 June 2013. Foreign institutional investors (FIIs) sold shares worth a net Rs 885.85 crore on Tuesday, 11 June 2013, as per provisional data from the stock exchanges.
At 12:20 IST, the S&P BSE Sensex was down 145.55 points or 0.76% to 18,997.45. The index declined 152.46 points at the day's low of 18,990.54 in early afternoon trade, its lowest level since 22 April 2013. The index fell 7.80 points at the day's high of 19,135.20 in morning trade.
The CNX Nifty was down 40.55 points or 0.7% to 5,748.25. The index hit a low of 5,747.30 in intraday trade, its lowest level since 18 April 2013. The index hit a high of 5,789.95 in intraday trade.
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The market breadth, indicating the overall health of the market, was weak. On BSE, 1,194 shares fell and 778 shares rose. A total of 121 shares were unchanged.
Among the 30-share Sensex pack, 23 stocks fell and rest of them rose. Coal India (down 3.24%), Hero MotoCorp (down 3.13%) and Bajaj Auto (down 2.96%), edged lower.
Jindal Steel & Power rose 1.08% to Rs 228.80 on bargain hunting after Tuesday's 15.18% losses triggered by media reports the Central Bureau of Investigation (CBI) has registered an FIR against Congress MP and company's Chairman Naveen Jindal in the coal scam case. The stock was volatile. The stock hit high of Rs 232.50 and low of Rs 219 so far during the day. The stock had hit 52-week low of Rs 202 in intraday trade on Tuesday, 11 June 2013.
The FIR has accused Navin Jindal and Jindal Power and Steel of misrepresentation of networth and concealing previous coal allotment. They are also charged with cheating and forgery. The Naveen Jindal group was allotted a total of 11 blocks, making it the single largest beneficiary of the controversial coal block allotment.
The CBI has also filed an FIR against former Minister of State for Coal Dasari Narayan Rao.
Index heavyweight Reliance Industries (RIL) fell 0.09%, with the stock reversing intraday gains.
ONGC rose 0.57%. ONGC withdrew a statement issued on Monday, 10 June 2013, saying its overseas oil exploration unit ONGC Videsh (OVL) and Oil India (OIL) had signed an agreement to buy a 10% stake in a Mozambique gas field viz. Rovuma Area 1 Offshore Block from Videocon Group for $2.48 billion. The company did not give the reason for the withdrawal. The field has the potential to become one of the world's largest liquefied natural gas (LNG) producing hubs by 2018, and is strategically located to supply gas to India at competitive prices, the withdrawn statement said.
Auto stocks edged lower. M&M, Tata Motors and Maruti Suzuki India dropped by 0.22% to 1.55%.
Shares of power generation and power distribution companies edged lower in weak market. GVK Power & Infrastructure, NTPC, Tata Power Company, Reliance Infrastructure, Reliance Power, Adani Power, JSW Energy, and Reliance Power shed by 0.06% to 2.36%.
Realty stocks edged higher on renewed buying. Unitech, HDIL, D B Realty and DLF rose by 0.01% to 1.23%.
Lanco Infratech tumbled 6.2%, with the stock extending Tuesday's 8.15% losses. The company on Tuesday, 11 June 2013, said in reply to queries made by a news channel that the company is not considering corporate debt restructuring proposal. The company also said that that the management is not considering any other debt restructuring proposal including bond issue. The debt of Lanco group excluding working capital of power companies and Griffin acquisition debt is Rs 34249 crore as at March 31, 2013. This debt is the total of 21 companies of the group. There are 15 operating companies which constitute around 50% of the debt which is serviced by them from their operations. The balance 50% debt is to projects under construction where the interest is part of project funding and part of the approved project cost, Lanco Infratech said.
Kirloskar Oil Engines (down 8.13%), Amtek Auto (down 5.25%), Parsvnath Developers (down 4.86%) and Opto Circuits India (down 4.67%), were the other biggest losers from the BSE Mid-Cap index.
ING Vysya Bank lost 1.38% as the stock turned ex-dividend today, 12 June 2013, for dividend of Rs 5.50 per share for the year ended 31 March 2013.
Industrial production rose 2% in April 2013, lower than a revised growth of 3.4% in March 2013, data released by the government today, 12 June 2013, showed. The manufacturing sector registered a growth of 2.8% and electricity generation rose 0.7%. The mining sector registered a decline of 3%. As per use-based classification, production of basic goods rose 1.3%, capital goods production rose 1%, production of intermediate goods rose 2.4% and production of consumer non-durables jumped 12.3%. Production of consumer durables declined 8.3%.
Meanwhile, industrial production growth for March 2013 was revised upwards to 3.4% from 2.5% growth reported earlier.
Inflation based on the combined consumer price index (CPI) for urban and rural India eased to 9.31% in May 2013 from 9.39% in April 2013, another data released by the government today, 12 June 2013, showed. With the CPI, inflation based on the category food and beverages stood at 10.65% in May 2013.
The Reserve Bank of India (RBI) on Tuesday took measures to increase the supply of dollars in the market including asking exporters to realise their dollar earnings and get them back into the country within one year to support a plunging rupee. The RBI also hastened the process of dollar inflows through online payment channels by increasing the amount that exporters can bring back to $10,000 from $3000. The new norms will be applicable with immediate effect, the Reserve Bank of India said. The rupee hit record low of 58.98 per dollar in intraday trade on Tuesday.
Dr. Raghuram G. Rajan, Chief Economic Adviser, Ministry of Finance, on Tuesday, 11 June 2013, said that the government continues to undertake measures to ensure the Current Account Deficit (CAD) is safely financed. Dr. Rajan issued the statement after a recent steep slide in rupee against the dollar. "In the coming weeks, we will be recommending the policies to enhance foreign direct investment (FDI) limits in a number of areas", he said. All this will help not just in the short term objective of financing the CAD but also in the longer term objective of ensuring sustainable growth, Dr. Rajan said.
Asian stocks fell on Wednesday as Japanese machinery orders declined more than expected and concern grew that central banks from Tokyo to Washington are increasingly reluctant to add stimulus. Key benchmark indices in Indonesia, Japan, Singapore and South Korea shed by 0.21% to 1.46%. Stock markets in Hong Kong, Taiwan and the Philippines were closed for holidays. Mainland Chinese markets are closed from Monday, 10 June 2013 till today, 12 June 2013, for the Dragon Boat Festival.
Japan's machinery orders, an indicator of future capital spending dropped 8.8% in April, more than estimated.
Trading in US index futures indicated that the Dow could gain 26 points at the opening bell on Wednesday, 12 June 2013. US stocks dropped on Tuesday after the Bank of Japan's status-quo policy decision revived concerns about the winding down of central bank stimulus measures. The restraint in Japan also raised questions about the US Federal Reserve's future direction of policy measures ahead of next week's Federal Open Market Committee meeting.
On Tuesday, Germany's constitutional court began hearing debate on whether the European Central Bank's Outright Monetary Transactions -- a yet-to-be-used program to buy bonds from struggling euro-bloc nations -- is allowable under German law. A ruling isn't expected until later this year, however.
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