Amid negative cues from global markets, key benchmark indices continued to languish in red in early afternoon trade. The market breadth indicating the overall health of the market was negative. The barometer index, the S&P BSE Sensex, was currently down 76.90 points or 0.28% at 27,129.78. Bank stocks declined. Metal and mining stocks also declined. Most pharma stocks gained after Department of Pharmaceuticals, under the Ministry of Chemicals and Fertilizers, scrapped guidelines issued on 29 May 2014 that gave the National Pharmaceutical Pricing Authority (NPPA) the powers to fix the prices of drugs that are not on the essential medicines list. Foreign portfolio investors (FPIs) sold shares worth a net Rs 186.41 crore yesterday, 22 September 2014. Meanwhile, Food Minister Ram Vilas Paswan said in a newspaper interview published today, 23 September 2014, that the government intends to increase the supply of heavily subsidised grain as it seeks to expand coverage under the food security law, a move that can inflate the government's subsidy bill and cause food prices to rise.
In overseas markets, Asian stocks edged lower in choppy trade after a preliminary reading of China's manufacturing sector showed activity making a surprise improvement this month while the subindexes for the flash manufacturing Purchasing Managers' Index (PMI) report painted a mixed picture. US stocks closed sharply lower yesterday, 22 September 2014, on concerns about global growth amid falling commodity prices.
Earlier, key indices had drifted lower after alternately swinging between positive and negative zone in early trade.
Brent crude oil prices rebounded from a one-week low after a survey showed China's factory activity unexpectedly picked up in September.
In the foreign exchange market, the rupee edged lower against the dollar on month-end dollar demand from importers to pay month-end bills.
At 12:15 IST, the S&P BSE Sensex was down 76.90 points or 0.28% at 27,129.78. The index lost 104.91 points at the day's low of 27,101.83 in mid-morning trade. The index rose 50.13 points at the day's high of 27,256.87 in early trade, its highest level since 9 September 2014.
The CNX Nifty was down 23.95 points or 0.29% at 8,122.35. The index hit a low of 8,113.80 in intraday trade. The index hit a high of 8,159.75 in intraday trade.
The market breadth indicating the overall health of the market was negative. On BSE, 1,450 shares declined and 1,166 shares rose. A total of 111 shares were unchanged.
The BSE Mid-Cap index was down 6.71 points or 0.07% at 9,878.11. The BSE Small-Cap index was up 8.07 points or 0.07% at 11,256.76. Both these indices outperformed the Sensex.
PSU bank stocks declined. Canara Bank (down 0.78%), Union Bank of India (down 1.05%), Bank of India (down 0.29%), Punjab National Bank (down 0.85%) Syndicate Bank (down 0.52%), Indian Overseas Bank (down 0.16%), Andhra Bank (down 0.95%), Oriental Bank of Commerce (down 2.57%), Dena Bank (down 0.16%) and Indian Bank (down 1.51%), declined. State Bank of India (SBI) rose 0.28%.
Among private sector banks, HDFC Bank (down 0.25%), ICICI Bank (down 0.87%), IndusInd Bank (down 0.09%), Yes Bank (down 0.61%), Kotak Mahindra Bank (down 0.73%) and Axis Bank (down 0.59%), declined. Federal Bank rose 0.61%.
Metal and mining stocks declined. Sesa Sterlite (down 0.32%), Hindalco Industries (down 2.19%), Jindal Steel & Power (down 1.61%), Tata Steel (down 1.23%), National Aluminum Company (down 3.91%) and NMDC (down 1.51%) declined. Steel Authority of India (Sail) (up 0.35%), JSW Steel (up 0.11%) and Hindustan Copper (up 0.8%) gained.
Most pharma stocks gained after Department of Pharmaceuticals, under the Ministry of Chemicals and Fertilizers, scrapped guidelines issued on 29 May 2014 that gave the National Pharmaceutical Pricing Authority (NPPA) the powers to fix the prices of drugs that are not on the essential medicines list. Sanofi India (up 12.24%), GlaxosmithKline Pharma (up 3.17%), Pfizer (up 0.33%), Merck (up 1.26%), Dr Reddy's Laboratories (up 0.54%), Sun Pharmaceutical Industries (up 0.31%), and Lupin ((up 0.04%) gained. Ranbaxy Laboratories (down 0.18%) and Cipla (down 1.12%) declined.
The NPPA had issued a notice in July imposing price caps on 108 non-essential drugs, which are used to treat diseases ranging from diabetes to HIV/AIDS. The move has been challenged by the industry lobby groups in courts, according to reports.
Indian stocks may remain volatile this week as traders roll over positions in the futures & options (F&O) segment from the near month September 2014 series to October 2014 series. The near-month September 2014 F&O contracts expire on Thursday, 25 September 2014.
Provisional data released by the stock exchanges after trading hours on Monday, 22 September 2014, showed that foreign portfolio investors (FPIs) sold shares worth a net Rs 186.41 crore on that day.
In the foreign exchange market, the rupee edged lower against the dollar on month-end dollar demand from importers to pay month-end bills. The partially convertible rupee was hovering at 60.8725, compared with its close of 60.825 during the previous trading session.
Brent crude oil prices rebounded from a one-week low after a survey showed China's factory activity unexpectedly picked up in September, helping brighten the demand outlook in a market that has been weighed by a supply glut. Brent for November settlement was up 25 cents at $97.25 a barrel. The contract had fallen $1.1 a barrel or 1.12% to settle at $96.97 a barrel yesterday, 22 September 2014, the lowest close since 15 September 2014.
Meanwhile, Food Minister Ram Vilas Paswan said in a newspaper interview published today, 23 September 2014, that the monthly entitlement of 5 kg foodgrain per person under food security law was meagre and that the government intends to increase the monthly entitlement to 7 kg, a move that can inflate the government's subsidy bill and cause food prices to rise. He said the food law passed by the previous government was inadequate.
Prime Minister Narendra Modi is scheduled to launch the ambitious 'Make in India' campaign on Thursday, 25 September 2014. The initiative is one of the several steps which government has announced in order to improve ease of doing business in India and attract investments to boost manufacturing in the country. In his maiden independence day address, Modi invited the global business community to set up manufacturing facilities in India, giving the slogan 'come, make in India'.
Asian stocks edged lower today, 23 September 2014, after a preliminary reading of China's manufacturing sector showed activity making a surprise improvement this month while the subindexes for the flash manufacturing Purchasing Managers' Index (PMI) report painted a mixed picture. Key benchmark indices in Indonesia, Hong Kong, Taiwan, and South Korea were off 0.01% to 0.64%. Key benchmark indices in China and Singapore were up 0.2% to 0.99%.
A Chinese manufacturing gauge unexpectedly increased this month. The preliminary Purchasing Managers' Index from HSBC Holdings Plc and Markit Economics was at 50.5, up from August's final reading of 50.2. The data was released today, 23 September 2014. Subindexes for the flash PMI report painted more of a mixed picture, however, with new export orders and overall new orders both showing gains at a faster rate than in August, but with the employment subindex falling at a faster rate. Likewise, prices for both inputs and outputs saw further weakness. HSBC chief China economist Hongbin Qu said in remarks accompanying the PMI data that economic activity in the manufacturing sector showed signs of stabilization in September. However, overall, the data still point to modest expansion, he said.
Trading in US index futures indicated that the Dow could gain 10 points at the opening bell on Tuesday, 23 September 2014. US stocks closed sharply lower on Monday, 22 September 2014, with the S&P 500 index suffering its biggest one-day decline since early August, as the latest housing data came in much weaker than expected, raising new concerns about the rate of growth in the economy. Sales of existing homes unexpectedly declined in August, for the first time in five months, the National Association of Realtors (NAR) reported. NAR attributed the drop to fewer all-cash sales to investors.
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