Weakness in key benchmark indices prevailed in afternoon trade as a negative opening in European stocks spoiled sentiment. The CNX Nifty hit a fresh intraday low while the S&P BSE Sensex slipped below the psychological 20,000 mark. The S&P BSE Sensex was down 125.51 points or 0.62%, off close to 146 points from the day's high and up about 55 points from the day's low. The market breadth, indicating the overall health of the market, was weak. Cigarette major ITC declined after Q1 results. Redington India, Vardhman Textiles, Tata Communications, MCX and Ambuja Cements saw a surge in volumes on BSE today, 25 July 2013.
Key benchmark indices hovered near the flat line in early trade after alternately moving between positive and negative zone. Key benchmark indices edged lower in morning trade. The market was range bound in mid-morning trade. Key benchmark indices hovered in red in early afternoon trade. Key benchmark indices were weak in afternoon trade as weak opening in European stocks spoiled sentiment
The market may remain volatile today, 25 July 2013, as traders roll over positions in the futures & options (F&) segment from the July 2013 series to August 2013 series. The near month July 2013 derivatives contracts expire today, 25 July 2013.
Foreign institutional investors (FIIs) sold shares worth a net Rs 404.50 crore on Wednesday, 24 July 2013, as per provisional data from the stock exchanges.
At 12:20 IST, the S&P BSE Sensex was down 125.51 points or 0.62% to 19,965.17. The index fell 180.60 points at the day's low of 19,910.08 in early trade, its lowest level since 17 July 2013. The index rose 20.13 points at the day's high of 20,110.81 in early trade.
The CNX Nifty was down 33.10 points or 0.55% to 5,957.40. The index hit a low of 5,946.75 in intraday trade, its lowest level since 17 July 2013. The index hit a high of 5,990.65 in intraday trade.
The S&P BSE Mid-Cap index was down 0.67% and the S&P BSE Small-Cap index was down 0.64%. Both these indices underperformed the Sensex.
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The market breadth, indicating the overall health of the market, was weak. On BSE, 1,336 shares fell and 730 shares rose. A total of 167 shares were unchanged.
Among the 30-share Sensex pack, 19 stocks fell and rest of them rose. Wipro (down 5.03%), Hindustan Unilever (down 3.63%), Tata Power (down 2.87%), Bhel (down 2.42%), Sterlite Industries (India) (down 1.89%), Coal India (down 1.07%), Larsen & Toubro (down 0.88%), Tata Steel (down 0.78%), ICICI Bank (down 0.77%), Sun Pharmaceutical Industries (down 0.67%) and Cipla (down 0.66%), edged lower from the Sensex pack.
Hero MotoCorp (up 3.83%), Dr. Reddy's Laboratories (up 1.37%), M&M (up 0.95%), HDFC (up 0.87%), Tata Motors (up 0.66%), Infosys (up 0.56%) and ONGC (up 0.55%), edged higher from the Sensex pack.
ITC tumbled 3.83% to Rs 361.60. The company's net profit rose 18.05% to Rs 1891.33 crore on 10.72% increase in total income to Rs 7,613.88 crore in Q1 June 2013 over Q1 June 2012. The result was announced during trading hours today, 25 July 2013.
Shares of ITC had witnessed a pre-result rally. The stock had jumped 15.71% to settle at Rs 376 on Wednesday, 24 July 2013, from a low of Rs 324.95 on 2 July 2013.
Redington India fell 2.36% to Rs 53.70. The counter clocked volume of 12.48 lakh shares, a 313.55-times surge over two-week average daily volume of 4,000 shares.
Vardhman Textiles fell 2.59% to Rs 287.15. The counter notched up volume of 5 lakh shares, a 39.81-fold surge over two-week average daily volume of 13,000 shares.
Tata Communications fell 1.06% to Rs 159. The counter saw volume of 10.36 lakh shares, a 21.61-fold surge over two-week average daily volume of 48,000 shares. The company unveils Q1 results on Friday, 26 July 2013.
MCX rose 0.29% to Rs 716.80. The counter clocked volume of 1.51 lakh shares, a 7.56-fold surge over two-week average daily volume of 20,000 shares. The company unveils Q1 results on 29 July 2013.
Ambuja Cements slumped 11.02% to Rs 170.05. The counter saw volume of 15.86 lakh shares, a 7.02-fold rise over two-week average daily volume of 2.26 lakh shares.
Ambuja Cements shares tumbled after Swiss parent Holcim announced a major restructuring of its India operations on Wednesday, 24 July 2013. Weak Q2 results also weighed on the counter. Currently, Holcim owns a little over 50% stake in Ambuja.
The board of directors of Ambuja Cements on Wednesday, 24 July 2013, approved a proposal, wherein Ambuja will first acquire from Holderind Investments, Mauritius (Holcim), a 24% stake in Holcim India for a cash consideration of Rs 3500 crore, followed by a merger of Holcim India into Ambuja. The intra-group transaction will result in Ambuja holding 50.01% stake in ACC. The merger swap ratio proposed by two independent accounting firms and approved by Ambuja's board, is one Ambuja share for 7.4 Holcim India shares, translating into an implied swap ratio of 6.6 Ambuja shares for every ACC share, Ambuja said in a statement. Based on the approved merger ratio, Ambuja will issue 58.4 crore new equity shares of the company to Holcim, as consideration for the merger. Post the merger, the expanded capital base of Ambuja (post cancellation of the shares held by Holcim India in Ambuja and the issuance of new shares as aforesaid) will increase by 28%. Holcim will then own 61.39% of Ambuja and Ambuja in turn own 50.01% of ACC.
In addition, Ambuja's board also provided its approval for Ambuja to make commercially reasonable efforts to invest up to Rs 3000 crore to acquire an economic ownership in ACC of up to 10% without triggering a mandatory open offer.
Ambuja said that this restructuring exercise is expected to be EPS accretive from year one post completion of the transaction. There is synergy potential of about Rs 900 crore through supply chain and fixed cost optimization expected to be realised in a phased manner over two years post completion of the transaction.
Meanwhile, Ambuja Cements' net profit fell 30.9% to Rs 324 crore on 8.6% decline in net sales to Rs 2346 crore in Q2 June 2013 over Q2 June 2012. The company announced Q2 result after market hours on Wednesday, 24 July 2013.
The cement industry is going through subdued demand on account of overall economic slowdown, Ambuja Cements said. Early onset of monsoon has put further pressure on demand, the company said. With regard to future business outlook, Ambuja Cements said that despite difficult macroeconomic conditions, the company is committed to its thrust in improving operational efficiency and productivity. The company believes that these initiatives will go a long way in preserving and even growing operating margins, it said.
Ambuja Cements also said that the board of directors of the company at its meeting held on 24 July 2013 approved setting up of a 2.17 million tonnes per annum (MTPA) greenfield clinkerization project at Marwar Mundwa, District Nagaur, Rajasthan and three clinker grinding units of 1.5 MTPA capacity each at Marwar Mundwa, Rajasthan, Dadri (phase II), Uttar Pradesh and Osara, Madhya Pradesh at an approximate cost of Rs 3500 crore.
European indices were trading lower in early trade. Key benchmark indices in UK, France and Germany were down by 0.14% to 0.47%.
Asian stocks fell on Thursday, 25 July 2013, as investors weighed US economic data to gauge the fate of Federal Reserve stimulus. Key benchmark indices in Indonesia, China, South Korea, Hong Kong, Singapore, Japan, and Taiwan were down by 0.13% to 1.14%.
China on Wednesday, 24 July 2013, announced some new, minor stimulus measures. China's cabinet on Wednesday, 24 July 2013, said it would cut taxes for small businesses and seek to aid some exporters, while also increasing state investment in railways.
Trading in US index futures indicated that the Dow could fall 28 points at the opening bell on Thursday, 25 July 2013. US stocks closed largely lower on Wednesday after improving home sales in the US renewed expectations that the Federal Reserve remains on course to winding down stimulus measures this year.
A report yesterday showed that new home sales rose more than forecast in June to a five-year high, and a manufacturing gauge rose. Fed Chairman Ben S. Bernanke has said asset purchases that have stoked bond and equity gains may be trimmed this year should economic risks subside. US new-home sales climbed 8.3% to an annualized pace of 497,000, the highest level since May 2008, according to Commerce Department data. The Markit Economics preliminary index of US manufacturing increased to 53.2 in July from a final reading of 51.9 a month earlier, the London-based group said.
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