Markets recover; Nifty hovers around 7,600

Markets have recovered during late noon trades after index heavy weights have trimmed their early losses.

 

Though during mid-day trades, markets edged lower under selling pressure as crude oil prices surged following media reports that militants have attacked Iraq's largest oil refinery.

 

Increase in oil prices has triggered macroeconomic worries over India which imports majority of its crude oil requirements.

Increase in crude oil prices have raised concerns of increase in fuel price inflation and increase in India's current account deficit and fiscal deficit.

 

At 14.25 PM, the S&P BSE Sensex shed over 170 points and traded at 25,346 while the CNX Nifty slumped over 40 points 7,591.

 

 

Broader are trading marginally lower. The market breath at BSE remains marginally weak as 1,619 shares declined and 1,300 advanced

 

Crude:

 

India's government sees oil prices going as high as $120 per barrel for three to four months because of fighting in Iraq, potentially driving a hole of at least 200 billion rupees ($3.4 billion) in the budget, two government sources told Reuters.

 

Meanwhile, Brent crude held above $113 per barrel on Wednesday as heavy fighting in Iraq shut the country's biggest refinery and led to the withdrawal of staff by foreign oil firms, stoking worries about exports from the key oil producer. Some oil companies are pulling foreign staff from Iraq, fearing Islamic militants from the north could strike at major oilfields concentrated in the south despite moves by the Baghdad government to tighten security.

 

Rupee:

 

The rupee slipped to 60.2825/3000 versus its previous close of 60.03/04 as the intensifying Iraq crisis leads to fears of supply disruption in oil supplies and domestic shares fall sharply.

 

Global Markets:

 

Asian stocks were mostly lower on Wednesday, 18 June 2014, as investors await the Federal Reserve monetary policy decision scheduled to be released later in the global day today,

 

Korean markets were off 0.2% to 1%. Key benchmark indices in Singapore, Taiwan and Japan were up 0.08% to 0.93%.

Sectoral indices and Stocks:

 

BSE Realty index was the top loser as it slipped over 1% followed by counters such as Power, Oil & Gas, Consumer Durables, Auto, IT Metal, FMCG, all down between 0.9% to 0.4%.

 

BSE Healthcare outperformed major indices as it surged over 0.4%.

 

Among oil refiners, Bharat Petroleum Corp fell 4%, Hindustan Petroleum Corp lost 4.5% and Indian Oil Corp slumped 3.9%.

 

Oil explorers also fell on worries about a higher subsidy burden as crude oil jumps. Oil and Natural Gas Corp fell 1.4% while Oil India lost 0.4%.

 

In other blue-chips, HDFC Bank fell 1.8% while Larsen & Toubro lost 1.7 percent.