Key benchmark indices tumbled in morning trade as the rupee dropped to a record low against the dollar. The S&P BSE Sensex dropped below the psychological 19,000 mark. The S&P BSE Sensex was down 463.89 points or 2.4%, off 407.25 points from the day's high and up 34.22 points from the day's low. The market breadth, indicating the overall health of the market, was weak. Indian bourses were closed on Thursday, 15 August 2013, on account of Independence Day.
Auto stocks edged lower. Titan Industries slumped after the Reserve Bank of India (RBI) issued clarificatory circular on gold import norms after market hours on Wednesday, 14 July 2013. Shares of other jewellery retailers also declined. Shares of Financial Technologies (India) cut steep intraday fall triggered by the company's unit, National Spot Exchange Ltd (NSEL), finalizing the detailed settlement plan. Shares of group firm Multi Commodity Exchange of India (MCX) hit record low.
Key benchmark indices declined in early trade on negative Asian stocks. Key benchmark indices tumbled in morning trade as the rupee dropped to a record low against the dollar. The S&P BSE Sensex dropped below the psychological 19,000 mark in morning trade. Key benchmark indices tumbled in morning trade as the rupee dropped to a record low against the dollar.
The rupee dropped to a record low against the dollar in early trade on increased selling of the US currency by banks after RBI announced stern measures to curb foreign exchange outflow amid weakening of the US currency overseas. The partially convertible rupee was hovering at 61.85 after hitting a record low of 62.02, weaker than its close of 61.43/ 61.44 on Wednesday, 14 August 2013.
Foreign institutional investors (FIIs) bought shares worth a net Rs 247.96 crore on Wednesday, 14 August 2013, as per provisional data from the stock exchanges.
At 10:20 IST, the S&P BSE Sensex was down 463.89 points or 2.4% to 18,903.70. The index lost 498.11 points at the day's low of 18,869.48 in morning trade, its lowest level since 13 August 2013. The index fell 56.64 points at the day's low of 19,310.95 in early trade.
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The CNX Nifty was down 151.75 points or 2.64% to 5,590.55. The index hit a low of 5,575.25 in intraday trade, its lowest level since 12 August 2013. The index hit a high of 5,716.60 in intraday trade.
The market breadth, indicating the overall health of the market, was weak. On BSE, 883 shares declined and 402 shares rose. A total of 31 shares were unchanged.
The total turnover on BSE amounted to Rs 479 crore by 10:20 IST on BSE compared to Rs 135 crore by 09:25 IST.
Among the 30-share Sensex pack, 27 stocks declined and only three of them gained.
Auto stocks edged lower. Maruti Suzuki India lost 4.48%.
Tata Motors shed 1.97%. The company's global wholesale vehicle sales fell 14% to 87,566 vehicles in July 2013 over July 2012. Global sales of passenger cars fell 13% to 46,684 vehicles in July 2013 over July 2012. Sales of its Jaguar Land Rover brand rose 30.61% to 35,162 units. Sales of its Jaguar cars rose 76.53% to 7,174 vehicles and Land Rover sales were higher by 22.45% at 27,988 vehicles during the month. The announcement was made after market hours on Wednesday, 14 August 2013.
Mahindra & Mahindra (M&M) declined 3.53%. The company after market hours on Wednesday, 14 August 2013, said it plans to invest Rs 200 crore to strengthen its current product line-up of trucks and buses. The company plans to invest Rs 300 crore to explore new product lines in the LCV, ICV and MCV range, it said.
Shares of two wheeler companies were mixed. Bajaj Auto slipped 0.81%. Bajaj Auto after market hours on Tuesday, 13 August 2013, said that the company has received a notice from the workmen's union viz. Vishwa Kalyan Kamgar Sanghatana stating that the stoppage of work at Chakan plant has been withdrawn and all the workmen at Chakan plant will resume their duty in their respective shifts from 14 August 2013. The company had earlier informed on 25 June 2013, that it had received a notice from the workmen's union of its Chakan plant viz., Vishwa Kalyan Kamgar Sanghatana stating that they propose to call for a stoppage of work by all the workmen employed in Chakan plant from the morning shift of 28 June 2013. The workmen at Chakan Plant had however, stopped coming from 25 June 2013 itself, without assigning any reason.
Hero MotoCorp rose 1.46%.
Titan Industries slumped 12.05% after the Reserve Bank of India (RBI) issued clarificatory circular on gold import norms after market hours on Wednesday, 14 July 2013. The RBI on Wednesday, 14 July 2013, banned the import of gold coins and medallions, and importers of gold will have to pay upfront before getting any of the yellow metal with the condition that at least 20% of the gold imported will have to be re-exported and the balance for domestic use.
Further, RBI said, nominated banks/ nominated agencies and other entities should make available gold for domestic use only to the entities engaged in jewellery business/bullion dealers and to banks authorised to administer the gold deposit scheme against full upfront payment.
Also, RBI said, nominated banks/agencies/refineries and other entities should ensure that there is no front-loading of imports, particularly in the first and second lots of imports. Such imports should be linked to normal quantities of gold supplied to the exporters by the nominated banks/agencies and should not exceed the highest quantity supplied during any one year out of last three years. The quantity thus arrived at, however, will not be imported in one or two lots only.
Shares of other jewellery retailers also declined. Tribhovandas Bhimji Zaveri Ltd (TBZ) (down 4.44%), Thangamayil Jewellery (down 0.53%), PC Jeweller (down 3.45%), Shree Ganesh Jewellery House (down 3.43%) and Tara Jewels (down 1.12%) declined. Gitanjali Gems gained 4%.
Shares of Financial Technologies (India) dropped 3.41% to Rs 141.60 after sliding as much as 18.14% to the day's low of Rs 120 in volatile trade. The company's unit, National Spot Exchange Ltd (NSEL), finalized the detailed settlement plan. As per the plan, starting 16 August 2013, there will be pay-in every Friday and pay-out every subsequent Tuesday. The detailed pay-in/pay-out schedule is given below and will be implemented in accordance with the Rules and Bye Laws of the Exchange.
"As the Managing Director and CEO, I and my management team at the NSEL have been solely and directly responsible for all operations, including screening of parties, warehouse management, risk management and other related company matters. As you are aware, there are 24 buyers are required to complete funds pay in obligation to ensure smooth settlement. Therefore, the focus should be on these buyers/processors for realization of pending dues and on nothing else. I and my management team will solely focus on ensuring smooth settlement as per the schedule annexed herewith," Mr. Anjani Sinha, MD & CEO, NSEL said in a statement.
Shares of group firm Multi Commodity Exchange of India (MCX) were locked at 5% lower circuit at Rs 240.65, also its record low.
The Reserve Bank of India on Wednesday, 14 August 2013 announced measures including reducing the limit for Overseas Direct Investment (ODI) under automatic route for all fresh ODI transactions, from 400% of the net worth of an Indian Party to 100% of its net worth. This reduced limit would also apply to remittances made under the ODI scheme by Indian Companies for setting up unincorporated entities outside India in the energy and natural resources sectors. This reduction in limit, however, would not apply to ODI by Navratna PSUs, ONGC Videsh and Oil India in overseas unincorporated entities and incorporated entities, in the oil sector. The RBI also announced reduction in the limit for remittances made by Resident Individuals, under the Liberalised Remittance Scheme (LRS Scheme), from $200,000 to $75,000 per financial year. Resident Individuals have, however, now been allowed to set up Joint Venture (JV)/Wholly Owned Subsidiary (WOS) outside India under the ODI route within the revised LRS limit.
While current restrictions on the use of LRS for prohibited transactions, such as, margin trading and lottery would continue, use of LRS for acquisition of immovable property outside India directly or indirectly will, henceforth, not be allowed, RBI said.
The present set of measures is aimed at moderating outflows. However, any genuine requirement beyond these limits will continue to be considered by RBI under the approval route.
Asian stocks were mostly higher on Friday as mainland Chinese stocks staged a steep rebound from initial losses, with the spike also helping other regional markets pare losses or pull higher. Key benchmark indices in China, Hong Kong, Singapore and Taiwan rose by 0.13% to 3.19%. Key benchmark indices in Indonesia, South Korea and Japan were down by 0.41% to 1.54%.
Trading in US index futures indicated that the Dow could gain 20 points at the opening bell on Friday, 16 August 2013. US stocks dropped on Thursday for a second day, with the Dow industrials posting their first back-to-back triple-digit drop since June, as Treasury yields spiked to 2011 highs and Wal-Mart Stores Inc. and Cisco Systems Inc. cut their forecasts.
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