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Sensex hits lowest closing level in four weeks

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Capital Market
Last Updated : Jun 04 2015 | 5:28 PM IST

Bank and metal & mining stocks led decline for the key benchmark indices in what was a highly volatile trading session. The barometer index, the S&P BSE Sensex, and, the 50-unit CNX Nifty, closed the session with small losses. The market breadth indicating the overall health of the market was negative. The Sensex hit its lowest closing level in four weeks. The 50-unit CNX Nifty hit its lowest closing level in more than three weeks. The Sensex fell 23.78 points or 0.09% to settle at 26,813.42.

The Sensex dropped for the third straight trading session today, 4 June 2015. The Nifty dropped for the fourth straight trading session today, 4 June 2015.

Bank stocks were mostly lower. Metal and mining stocks also edged lower. Shares of public sector oil marketing companies (PSU OMCs) edged higher on lower crude oil prices.

Earlier, the Sensex and Nifty hit their lowest level in four weeks in afternoon trade as these two indices extended intraday slide. Key indices sharply pared losses towards the end of the trading session to close the session with small losses.

Meanwhile, the India Meteorological Department (IMD) yesterday, 3 June 2015 said that conditions are favourable for onset of southwest monsoon over Kerala during next 48 hours.

Foreign portfolio investors sold shares worth a net Rs 727.61 crore yesterday, 3 June 2015, as per provisional data. Domestic institutional investors (DIIs) bought shares worth a net Rs 412.66 crore yesterday, 3 June 2015, as per provisional data released by the stock exchanges.

In overseas markets, European stocks edged lower today, 4 June 2015. Asian stocks were mixed. Overnight, US stocks rose at the end of trade, following positive US economic data and as negotiations between Greece and its international creditors continued to move forward.

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The S&P BSE Sensex fell 23.78 points or 0.09% to settle at 26,813.42, its lowest closing level since 7 May 2015. The index fell 285.23 points at the day's low of 26,551.97 in mid-afternoon trade. The index rose 111.64 points at the day's high of 26,948.84 at the onset of trading session.

The CNX Nifty fell 4.45 points or 0.05% to settle at 8,130.65, its lowest closing level since 12 May 2015. The index hit a low of 8,056.75 in intraday trade, its lowest level since 7 May 2015. The index hit a high of 8,160.05 in intraday trade.

The BSE Mid-Cap index rose 17.99 points or 0.17% to settle at 10,347.45, outperforming the Sensex. The BSE Small-Cap index fell 4.45 points or 0.04% to settle at 10,823.73. The decline in this index was lower than the Sensex's decline in percentage terms.

The market breadth indicating the overall health of the market was negative. On BSE, 1,382 shares fell and 1,273 shares rose. A total of 119 shares were unchanged.

The total turnover on BSE amounted to Rs 4669 crore, higher than turnover of Rs 3501.33 crore registered during the previous trading session.

Among the sectoral indices on BSE, the S&P BSE FMCG index (down 0.33%), BSE Healthcare index (down 0.77%), BSE Auto index (down 0.7%), BSE Consumer Durables index (down 0.75%) and BSE Metal index (down 1.11%) underperformed the Sensex. The S&P BSE IT index (up 0.2%), BSE Bankex index (up 0.08%), BSE Capital Goods index (up 0.59%), BSE Oil & Gas index (up 0.53%), BSE Power index (up 0.13%), BSE Realty index (up 0.82%) and BSE Teck index (up 0.2%) outperformed the Sensex.

Bank stocks were mostly lower. Among public sector banks, Union Bank of India (down 4.01%), Bank of India (down 3.5%), Punjab National Bank (down 3.85%), Oriental Bank of Commerce (down 3.44%), Indian Overseas Bank (down 2.39%), IDBI Bank (down 1.93%) and Andhra Bank (down 1.26%) edged lower. State Bank of India (up 0.02%), Bank of Baroda (up 0.34%) and Central Bank of India (up 1.05%) edged higher.

Among private sector banks, Kotak Mahindra Bank (up 1.35%), HDFC Bank (up 1.05%), Axis Bank (up 0.98%) and IndusInd Bank (up 0.24%) edged higher. ICICI Bank (down 1.74%) and Yes Bank (down 0.14%) edged lower.

Metal and mining stocks declined. National Aluminium Company (down 4.39%), Steel Authority of India (down 4.01%), NMDC (down 4.48%), Tata Steel (down 2.58%), Jindal Steel & Power (down 0.65%), JSW Steel (down 0.13%) and Hindalco Industries (down 0.66%) edged lower. Hindustan Zinc (up 0.9%) edged higher.

Vedanta was off 1.69%. Cairn India was off 0.35%. Vedanta during market hours today, 4 June 2015 said it has notified transfer of 4.98% shareholding in Cairn India to Vedanta from Twinstar Mauritius Holdings, a wholly owned subsidiary of Vedanta. Vedanta has entered into an agreement with a wholly owned subsidiary, Twinstar Mauritius Holdings (TSMHL), whereby TSMHL has transferred 4.98% of its stake in Cairn India to Vedanta for a cash consideration of $315 million. The funds received by TSMHL will be used to service existing debt obligations at TSMHL. Vedanta's ownership in Cairn India does not change as a result of this share transfer.

Twin Star Mauritius Holdings held 39.41% stake in Cairn India as at 31 March 2015. Vedanta held 18.73% stake in Cairn India as at 31 March 2015.

Shares of public sector oil marketing companies (PSU OMCs) edged higher on lower crude oil prices. BPCL (up 3.2%) and HPCL (up 0.69%) edged higher.

Lower crude oil prices could decrease under-recoveries of PSU OMCs on domestic sale of LPG and kerosene at controlled prices. The government has already freed pricing of petrol and diesel. However, a weak rupee will increase cost of crude oil imports.

In global commodity markets, Brent crude oil futures edged higher in volatile trade today, 4 June 2015. Brent for July settlement was up 15 cents at $63.95 a barrel. The contract had fallen $1.69 a barrel or 2.58% to settle at $63.80 a barrel during the previous trading session.

Oil cartel OPEC is expected to keep its production target of 30 million barrels of oil per day unchanged at a meeting scheduled in Vienna tomorrow, 5 June 2015. The OPEC meeting is being closely watched for clues about the organization's next moves.

In the foreign exchange market, the rupee fell below 64 mark against the dollar. The partially convertible rupee was hovering at 64.04, compared with closing of 63.91 during the previous trading session.

Indian Oil Corporation (IOCL) was up 3.5%. With regard to news item titled "IOC, HPCL in talks with Iraq's SOMO to buy 4m bbls oil for strategic reserves", IOCL after market hours yesterday, 3 June 2015, said that the Government of India has directed IOCL and HPCL to procure crude oil from Iraq for "Indian Strategic Petroleum Reserves", a wholly wwned Government company under the Ministry of Petroleum & Natural Gas set up for storage of strategic reserves. IOCL has only acted as a facilitator for import, the company said.

Bharti Airtel fell 1.25% at Rs 416. The stock hit a high of Rs 424.35 and a low of Rs 414 in intraday trade. Bharti Airtel announced during trading hours today, 4 June 2015, that it has successfully priced an issuance of $1000 million 4.375% Senior Notes due 2025. The Notes are expected to carry a final rating of Investment Grade from Moody's, Standard & Poor and Fitch. With 66% bonds allocated to the US investors, this is the highest ever allocation to US investors in any Indian deal, demonstrating the strong investor base Bharti has created for itself in developed markets allowing it to efficiently raise capital from world's leading fixed income investors.

With total order book of $2 billion, the issue was subscribed 2 times with participation from 160 quality accounts. As per regional allocation, US received 66%, Europe 18% and Asia got 16%. There was 80% allocation to mutual funds and insurance companies, with balance to banks. The US dollar Notes have been priced at 210 basis points over 10 year US dollar Treasury with a fixed coupon of 4.375% per annum to yield 4.462%, Bharti Airtel said in a statement.

The Sensex slipped for the third straight trading session today, 4 June 2015. The Sensex has slumped 1,035.57 points or 3.71% in the past three trading sessions from a recent high of 27,848.99 on 1 June 2015. The Sensex has fallen 686 points or 2.49% in this calendar year so far (till 4 June 2015). From a 52-week low of 24,644.88 on 5 June 2014, the Sensex has risen 2,168.54 points or 8.79%. The Sensex is off 3,211.32 points or 10.69% from a record high of 30,024.74 hit on 4 March 2015.

The India Meteorological Department (IMD) yesterday, 3 June 2015 said that conditions are favourable for onset of southwest monsoon over Kerala during next 48 hours.

In overseas markets, European stocks edged lower today, 4 June 2015. Key indices in Germany, UK and France were off 1.27% to 1.45%.

France's unemployment rate fell to 10.3% in the first quarter from 10.4% in the previous three months, national statistics office Insee said today, 4 June 2015.

European Central Bank (ECB) left its main interest rates unchanged at record-low levels. Upbeat news around Greece's ability to pay its international creditors later this week also lingered in the market.

Asian stocks were mixed. Key benchmark indices in Hong Kong, Taiwan, Singapore and Indonesia were down by 0.07% to 2.18%. Key benchmark indices in China, Japan and South Korea were up by 0.07% to 0.76%.

China revised down its estimate of consumption's contribution to economic growth last year, trimming the figure to 50.2% from 51.2% previously. Investment and exports contributed 48.5% and 1.3%, respectively to gross domestic product in 2014, the National Bureau of Statistics said Wednesday. Consumption contributed an average 52.9% annually to the country's GDP over the past five years, official data showed. Investment averaged 51.2% while exports averaged a negative 4.1%.

Overnight, US stocks rose at the end of trade, following positive US economic data and as negotiations between Greece and its international creditors continued to move forward.

In economic readings ahead of the latest session, the Commerce Department said the US trade deficit contracted by 19.2% in April, the sharpest drop in more than six years. The West Coast port strike, which was resolved in February, caused big swings in the trade gap the first several months of the year. In March, the deficit increased to its highest level in more than six years.

Separately, an employment report showed private payrolls in the US increased at a modest clip in May, but at a pace that was below expectations.

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First Published: Jun 04 2015 | 4:06 PM IST

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