A recovery from lower level after initial losses proved short lived as key benchmark indices weakened once again in morning trade. The S&P BSE Sensex was down 73.22 points or 0.36%, off about 40 points from the day's high and about 45 points from the day's low. The market sentiment was hit adversely as the government revised downwards the GDP growth rate for the year ended 31 March 2013 (FY 2013) to 4.5% from 5% reported earlier. Weakness in Asian stocks also dampened sentiment on the domestic bourses.
Telecom stocks dropped ahead of the spectrum auction scheduled today, 3 February 2014. Shares of organised retailers declined after the Rajasthan state government reversed its earlier stand of allowing entry of global supermarket chains in the state. Bajaj Auto rose after the company reported increase in exports for the month just gone by.
The market breadth, indicating the overall health of the market, was positive.
The market edged lower in early trade on weak Asian stocks. A recovery from lower level after initial losses proved short lived as key benchmark indices weakened once again in morning trade.
Asian stocks fell on Monday, 3 February 2014, as slowdown in Chinese manufacturing growth added to concern the global economic recovery is faltering.
The market sentiment was affected adversely by data showing that foreign funds were net sellers of Indian stocks on Friday, 31 January 2014. Foreign institutional investors (FIIs) sold shares worth a net Rs 652.97 crore on Friday, 31 January 2014, as per provisional data from the stock exchanges.
At 10:20 IST, the S&P BSE Sensex was down 73.22 points or 0.36% to 20,440.63. The index fell 121.89 points at the day's low of 20,391.96 in early trade, its lowest level since 30 January 2014. The index declined 33.50 points at the day's high of 20,480.35 in early trade.
The CNX Nifty was down 18.40 points or 0.3% to 6,071.10. The index hit a low of 6,052.20 in intraday trade, its lowest level since 30 January 2014. The index hit a high of 6,074.85 in intraday trade.
The market breadth, indicating the overall health of the market, was positive. On BSE, 849 shares rose and 725 shares declined. A total of 98 shares were unchanged.
Among the 30-share Sensex pack, 20 stocks declined and rest of them rose. M&M (down 2.03%), Tata Motors (down 1.39%) and Hindalco Industries (down 1.32%) edged lower from the Sensex pack.
Telecom stocks dropped ahead of the spectrum auction scheduled today, 3 February 2014. MTNL (down 2.2%), Reliance Communications (down 1.38%), Idea Cellular (down 1.29%) and Bharti Airtel (down 2.36%) declined. Tata Teleservices (Maharashtra) rose 0.83%. The government has put up for sale 403 units of airwaves in 1800 Mhz band and 46 units in the 900 Mhz band for spectrum auction scheduled today, 3 February 2014.
Bajaj Auto rose 1.07%. The company said during market hours that its total sales fell 8% to 3.18 lakh units in January 2014 over January 2013. Exports rose 7% to 1.37 lakh units in January 2014 over January 2013. Motorcycle sales declined 7% to 2.81 lakh units in January 2014 over January 2013. Commercial vehicles sales dropped 20% to 36,781 units in January 2014 over January 2013.
Shares of organised retailers declined after the Rajasthan state government reversed its earlier stand of allowing entry of global supermarket chains in the state. Trent (down 0.58%) and Shopper Stop (down 0.69%) declined. Future Retail rose 0.49%.
Rajasthan, one of the 12 states that had agreed to allow global companies to open supermarkets, has scrapped the approval given by the previous government for foreign direct investment (FDI) in multi-brand retail. A letter reversing the decision was sent by Rajasthan Chief Minister Vasundhara Raje to commerce and industry minister Anand Sharma.
Rajasthan has become the second state, after Delhi, to withdraw approval for FDI in multi-brand retail following a change of government after the assembly elections held in November-December. The Congress lost to the Bharatiya Janata Party in Rajasthan and to the Aam Aadmi Party in Delhi. The central government permitted 51% FDI in multi-brand retail trading in September 2012 and left its implementation to the states.
In the foreign exchange market, the rupee edged higher against the dollar on dollar's board based decline against major currencies. The partially convertible rupee was hovering at 62.61, compared with its close of 62.68/69 on Friday, 31 January 2014.
The First Revised Estimates of National Income, Consumption Expenditure, Saving and Capital Formation, for the year 2012-13 released on Friday, 31 January 2014, showed India GDP revised down to 4.5% in 2012-13 from 5% earlier and as against a growth of 6.7% in the year 2011-12. The downward revision was mainly due to lower than provisionally estimated output in primary and secondary sectors. The data also showed lower-than-estimated growth numbers for exports, capital investment and consumption sectors, thereby pointing out to deeper underlying weaknesses.
The Eight Core Industries having a combined weight of 37.9% in the Index of Industrial Production (IIP) increased by 2.1% in December 2013 compared with a growth of 7.5% growth in December 2012 and 1.7% growth in November 2013, data released by the government after trading hours on Friday, 31 January 2014, showed.
The fiscal deficit reached Rs 5.16 lakh crore during April-December 2013, or 95.2% of the full-year target, compared with 78.8% a year earlier, data released by the government after trading hours on Friday, 31 January 2014, showed. Factory gate duties were down 6.9% at Rs 1.02 lakh crore during April-December from the year-earlier period, while customs tax receipts rose 4.3% to Rs 1.24 lakh crore -- much lower than the 13.6% annual growth target.
Markit Economics will unveil HSBC India Manufacturing PMI, which gauges the business activity of India's factories for January 2014 today, 3 February 2014. The HSBC Manufacturing PMI, compiled by Markit, eased to 50.7 in December, from 51.3 in November.
The Reserve Bank of India next undertakes monetary policy review on 1 April 2014. Sighting elevated consumer price inflation, the Reserve Bank of India raised its key lending rates by 25 basis points after Third Quarter Review of Monetary Policy for 2013-14 on 28 January 2014.
Asian stocks fell on Monday, 3 February 2014, after a slowdown in Chinese manufacturing growth added to concern the global economic recovery is faltering. Key benchmark indices in Indonesia, Japan, Singapore and South Korea shed by 0.65% to 1.49%.
China's markets remain closed until 7 February 2014 for the Lunar New Year holiday, while Hong Kong and Taiwan is shut until 4 February 2014.
China's Purchasing Managers' Index was at 50.5 in January compared with December's 51 reading, the National Bureau of Statistics and China Federation of Logistics and Purchasing said on Saturday, 1 February 2014 in Beijing. Numbers above 50 signal expansion. The survey showed jobs and export orders shrinking, amplifying risks of a deeper slowdown as Communist Party leaders clamp down on the $6 trillion shadow-banking industry and interbank borrowing costs rise. A separate private manufacturing gauge released by HSBC Holdings Plc and Markit Economics on Jan. 30 pointed to the first contraction in six months.
Growth in China's services sector cooled in January to its slowest pace in at least a year, data showed on Monday, the latest sign that the Chinese economy lost momentum last month in the run-up to the Lunar New Year holiday. The official non-manufacturing Purchasing Managers' Index slipped to 53.4 from December's 54.6, the lowest reading in at least a year but still above the 50-point level that indicates growth.
Trading in US index futures indicated that the Dow could advance 26 points at the opening bell on Monday, 3 February 2014. US stocks fell sharply on Friday amid continued unease over emerging markets and a number of high-profile earnings disappointments.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review on 18-19 March 2014. After a monetary policy review, the FOMC on 29 January 2014 announced it will reduce monthly bond purchases by another $10 billion to $65 billion. The Fed also signaled that it is likely to keep reducing bond purchases in the coming months, citing a pickup in US economic activity and improvement in the US labor market.
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