Key benchmark indices reversed direction after a higher opening triggered by gains in Asian stocks. The barometer index, the S&P BSE Sensex, fell below the psychological 25,000 level in early trade. The Sensex was down 46.85 points or 0.19%, off 118.26 points from the day's high and up 28.77 points from the day's low. IT major Infosys dropped sharply in early trade. The market breadth indicating the overall health of the market was weak.
The market sentiment was affected adversely by data showing that foreign portfolio investors (FPIs) were net sellers of Indian stocks on Friday, 11 July 2014. Foreign portfolio investors (FPIs) sold shares worth a net Rs 723.48 crore on Friday, 11 July 2014, as per provisional data from the stock exchanges.
At 9:25 IST, the S&P BSE Sensex was down 46.85 points or 0.19% to 24,977.50. The index gained 71.41 points at the day's high of 25,095.76 at the onset of the trading session. The index fell 75.62 points at the day's low of 24,948.73 in early trade.
The CNX Nifty was down 19.15 points or 0.26% to 7,440.45. The index hit a high of 7,471.65 in intraday trade. The index hit a low of 7,431.80 in intraday trade.
The market breadth, indicating the overall health of the market, was weak. On BSE, 817 shares declined and 437 shares rose. A total of 52 shares were unchanged.
The BSE Mid-Cap index was off 39.41 points or 0.44% at 8,835.83. The BSE Small-Cap index was off 51.98 points or 0.54% at 9,636.13. Both these indices underperformed the Sensex.
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The total turnover on BSE amounted to Rs 241 crore by 09:30 IST.
Among the 30-share Sensex pack, 16 stocks declined and rest of them gained.
Sun Pharmaceutical Industries (down 2.25%), Sesa Sterlite (down 1.74%) and State Bank of India (down 1.68%) edged lower from the Sensex pack.
Tata Motors rose 0.34%. Tata Motors after market hours on Friday, 11 July 2014, said that its global wholesales declined 10.46% to 75,623 units in June 2014 over June 2013.
Tata Steel fell 0.81%. Tata Steel turned ex-dividend today, 14 July 2014, for dividend of Rs 10 per share for the year ended 31 March 2014.
IT major Infosys dropped 3.27%. While Infosys shares had risen 1% amid intraday volatility on Friday, 11 July 2014, after the announcement of the results before trading hours on that day, the company's ADR had lost 2.57% on that day. The company's consolidated net profit as per International Financial Reporting Standards (IFRS) fell 3.5% to Rs 2886 crore on 0.8% decline in revenue to Rs 12770 crore in Q1 June 2014 over Q4 March 2014. The result was announced before market hours on Friday, 11 July 2014.
Infosys expects its consolidated revenue to grow 7%-9% in dollar terms in the year ending 31 March 2015 (FY 2015). The guidance is unchanged compared to the one the company had given at the time of announcement of Q4 March 2014 results in April this year. The guidance in rupee terms has also been kept unchanged from that given in April as the company has assumed rupee dollar conversion rate of 60 which is exactly the same conversion rate given in April guidance. The company expects its revenue to grow 5.6%-7.6% in rupee terms in FY 2015.
At a conference call held after the first quarter results, Infosys management said it expects margins to remain flattish in the current year, excluding the impact of the depreciation as it plans to invest in the business as growth remains top priority. Infosys' depreciation outgo was lower by sharp 36% at Rs 230 crore in Q1 June 2014 over Q4 March 2014 due to a change in depreciation policy during the quarter.
Infosys said that the deal pipeline is stable with marginal improvement. There is greater comfort in the pipeline over the last year due to the increase in the discretionary spending, the management said in conference call. The company is focusing lot more on execution.
Revenue Secretary Shaktikanta Das was quoted by the media as saying on Saturday, 12 July 2014, that the government would shortly take a view on whether tax law General Anti-Avoidance Rules (GAAR) should be implemented from the scheduled date of April 2015. Reports that the government has reiterated that General Anti Avoidance Rules (GAAR) will be applicable from 1 April 2015 spooked the market on Friday, 11 July 2014 -- a day after the presentation of the Budget on 10 July 2014. GAAR is a tool to curb tax avoidance. There was an expectation that the new government will postpone the implementation of GAAR to a future date. The Sensex lost 1.37% on Friday.
On the macro front, the government is scheduled to announce the data of inflation based on the wholesale price index (WPI) for the month of June 2014 today, 14 July 2014.
Industrial output grew at its strongest pace in 19 months by 4.7% in May 2014, higher than 3.4% growth in April 2014, government data released after market hours on Friday, 11 July 2014 showed.
Asian markets edged higher on Monday, 14 July 2014, as euro zone banking jitters faded. Key benchmark indices in South Korea, China, Taiwan, Hong Kong and Japan were up 0.26% to 0.38%. Key benchmark indices in Indonesia and Singapore were off 0.14% to 0.29%.
Singapore's economy unexpectedly contracted in the second quarter as a tight labor supply and company moves to shift production overseas hurt manufacturing. Gross domestic product fell an annualized 0.8% in the three months through June from the previous quarter, when it expanded a revised 1.6%, the trade ministry said in a statement today, 14 July 2014.
US stocks rose on Friday, 11 July 2014 as a rally in Amazon.com Inc. and EBay Inc. led an intraday rebound from declines spurred by concern over financial stress in Europe.
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