Key benchmark indices extended losses to hit fresh intraday low in afternoon trade as several upbeat economic reports spurred thinking that the Federal Reserve will begin to scale back its monthly bond buys in September 2013. The S&P BSE Sensex was down 544.18 points or 2.81%, off close to 490 points from the day's high and up about 20 points from the day's low. The market breadth, indicating the overall health of the market, was weak. All the thirteen sectoral indices on BSE were in the red.
Capital goods pivotals edged lower on worries the ongoing slowdown in the economy could restrict new orders, with L&T hitting 52-week low. IT stocks were mixed.
Key benchmark indices declined in early trade as several upbeat economic reports spurred thinking that the Federal Reserve will begin to scale back its monthly bond buys in September 2013. The Sensex dropped below the psychological 19,000 mark. Key benchmark indices tumbled in morning trade as the rupee dropped to a record low against the dollar. Key benchmark indices hit fresh intraday low in mid-morning trade. The Sensex extended losses to hit fresh intraday low in afternoon trade.
The rupee trimmed losses after hitting record low below 62 against the dollar as exporters step in to sell the greenback. The partially convertible rupee was hovering at 61.70, weaker than its close of 61.43/ 61.44 on Wednesday, 14 August 2013. The rupee hit record low of 62.02 in intraday trade. Indian financial markets were closed on Thursday, 15 August 2013, for Independence Day holiday.
At 13:20 IST, the S&P BSE Sensex was down 544.18 points or 2.81% to 18,823.41. The index lost 567.64 points at the day's low of 18,799.95 in afternoon trade, its lowest level since 12 August 2013. The index fell 56.64 points at the day's low of 19,310.95 in early trade.
The CNX Nifty was down 179.80 points or 3.13% to 5,582.50. The index hit a low of 5,558.60 in intraday trade, its lowest level since 12 August 2013. The index hit a high of 5,716.60 in intraday trade.
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The market breadth, indicating the overall health of the market, was weak. On BSE, 1,459 shares declined and 647 shares rose. A total of 128 shares were unchanged.
Among the 30-share Sensex pack, 27 stocks declined and only three of them gained. Sterlite Industries (down 4.86%), HDFC (down 5.05%) and Maruti Suzuki India (down 4.8%), edged lower from the Sensex pack.
Capital goods pivotals edged lower on worries the ongoing slowdown in the economy could restrict new orders. L&T declined 3.98% to Rs 766.25 after hitting a 52-week low of Rs 763.35 in intraday trade today, 16 August 2013.
Bhel tumbled 7.45%, with the stock extending intraday losses.
IT stocks were mixed. Infosys declined 2.27% to Rs 3,000. The stock had hit 52-week high of Rs 3,098.40 in intraday trade on Tuesday, 13 August 2013.
Wipro rose 0.96% to Rs 464.50. The stock had hit a 52-week high of Rs 473.20 in intraday trade on Wednesday, 14 August 2013.
HCL Technologies rose 0.46% to Rs 925. The stock had hit a record high of Rs 960.75 in intraday trade on 5 August 2013.
IT major TCS declined 2.28% to Rs 1,789.90. The stock had hit a record high of Rs 1,890.30 in intraday trade on 7 August 2013.
A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports.
Shares of Financial Technologies rose 8.65% to Rs 159.25, after sliding as much as 18.14% to the day's low of Rs 120 in volatile trade. The National Spot Exchange (NSEL), which shut its operations this month following regulatory probes over possible trading violations, on Wednesday, 14 August 2013, said it has 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. Financial Technologies is one of the two promoters of NSEL.
Shares of Multi Commodity Exchange of India (MCX), a commodities futures exchange promoted by Financial Technologies, rose 0.67% to Rs 255, with the stock recovering after hitting 5% lower circuit at Rs 240.65, also its record low earlier in the day.
The Reserve Bank of India on Wednesday, 14 August 2013, announced measures to curb gold imports and capital outflows. The RBI limited the investment Indian companies can make overseas without seeking its approval to 100% of their net worth. They were previously allowed to invest up to four times their net worth. The RBI also reduced the amount that people living in India can send abroad to $75,000 a year from $200,000. Further, it said the remittances cannot be used for buying property abroad. "The present set of measures is aimed at moderating outflows," the RBI said in a news release. The central bank would, however, consider requests for permission to invest beyond the limit it set Wednesday, it said. However, the central bank has exempted large state-run companies from this restriction.
European stocks were little changed on Friday, 16 August 2013, ahead of more data from the US, including a sentiment survey. Key benchmark indices in France, and UK rose by 0.01% to 0.09%. Germany's DAX fell 0.05%.
Asian stocks declined on Friday, 16 August 2013, as several upbeat economic reports spurred thinking that the Federal Reserve will begin to scale back its monthly bond buys in September 2013. Key benchmark indices in Indonesia, China, South Korea, Hong Kong, Singapore and Japan were down by 0.12% to 1.78%. Taiwan's Taiwan Weighted index rose 0.48%.
Trading in US index futures indicated that the Dow could gain 22 points at the opening bell on Friday, 16 August 2013. US stocks slumped on Thursday, 15 August 2013, as better-than-expected data, such as weekly jobless numbers, heightened fears of imminent tapering of the Federal Reserve's bond-buying program.
The US central bank currently buys $85 billion a month in US debt and mortgage-backed securities in a bid to hold interest rates low and encourage economic growth. Federal Reserve Chairman Ben Bernanke has on several occasions stressed that the tapering process is dependent on an improvement in data. Fed's bond-buying program has kept global markets flush with liquidity in recent years.
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