Volatility ruled the roost in afternoon trade as the key benchmark indices cut losses after extending intraday fall. The Sensex was down 69.33 points or 0.32%, up 36.47 points from the day's low and off 89.72 points from the day's high. The market breadth, indicating the overall health of the market was negative. Sentiment was hit by weakness in Asian stocks.
Index heavyweight and cigarette maker ITC edged lower in choppy trade. Index largest FMCG company by sales Hindustan Unilever gained in volatile trade. Capital goods stocks declined. Many pharma shares gained. Eveready Industries India rose after the company announced a hike in the prices of its batteries.
The market edged lower in early trade on weak Asian stocks. The Sensex extended initial losses and hit fresh intraday low in morning trade. The Sensex and the 50-unit CNX Nifty, both, hit their lowest level in almost a week. The Sensex trimmed intraday losses in mid-morning trade. A bout of volatility was witnessed as the Sensex once again slipped into the red after briefly moving into positive zone from negative zone in early afternoon trade. Volatility ruled the roost in afternoon trade as the key benchmark indices cut losses after extending intraday fall.
At 13:15 IST, the S&P BSE Sensex was down 69.33 points or 0.32% to 21,763.53. The index declined 105.80 points at the day's low of 21,727.06 in morning trade, its lowest level since 14 March 2014. The index rose 20.39 points at the day's high of 21,853.25 in early afternoon trade.
The CNX Nifty was down 26.70 points or 0.41% to 6,497.35. The index hit a low of 6,488.50 in intraday trade, its lowest level since 14 March 2014. The index hit a high of 6,523.65 in intraday trade.
The BSE Mid-Cap index was down 7.39 points or 0.11% at 6,732.19. The BSE Small-Cap index was up 18.77 points or 0.28% at 6,741.12. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market was negative. On BSE, 1,392 shares fell and 1,174 shares rose. A total of 171 shares were unchanged.
The total turnover on BSE amounted to Rs 1118 crore by 13:15 IST.
GAIL (India) (down 2.89%), Coal India (down 2.34%) and HDFC (down 1.73%) edged lower from the Sensex pack.
TCS (up 3.46%), Wipro (up 2.45%) and Infosys (up 2.24%) edged higher from the Sensex pack.
Index heavyweight and cigarette maker ITC was off 1.81% at Rs 353.05. The stock hit high of Rs 358.50 and low of Rs 352.55 so far during the day.
Index largest FMCG company by sales Hindustan Unilever gained 1.76% at Rs 571.45 in volatile trade. The stock hit high of Rs 574 and low of Rs 561.90 so far during the day.
Capital goods stocks declined. L&T (down 2.22%), Bharat Heavy Electricals (Bhel) (down 2.5%), ABB India (down 0.25%), BEML (down 1.08%), Bharat Electronics (down 1.09%), Crompton Greaves (down 3.1%) and Thermax (down 1.39%) declined. Siemens rose 0.36%.
Cummins India fell 2.33% to Rs 568.85, with the stock declining on profit booking. Shares of Cummins India had gained 13.03% in four trading days to Rs 582.45 on 19 March 2014 from a recent low of Rs 515.30 on 12 March 2014.
Many pharma shares gained. Cadila Healthcare (up 2%), Cipla (up 0.87%), Glenmark Pharmaceuticals (up 0.52%), Lupin (up 0.85%), Ranbaxy Laboratories (up 0.36%) and Sun Pharmaceutical Industries (up 1.37%) gained.
Dr Reddy's Laboratories fell 0.87%.
Eveready Industries India rose 1.03% after the company announced a hike in the prices of its batteries. The company made the announcement during trading hours today, 20 March 2014.
According to Mr Deepak Khaitan, Vice Chairman of Eveready, "A long cycle of continuous upward trend in cost of materials and overhead expenses had adversely impacted the cost of batteries. This necessitates another round of price increase to protect margins. Realization will go up by 3% to 8% - through increase of MRP's from April 2014 of pencil size batteries by Rs 5 to Rs 10 per strip of 10 batteries and for all D size batteries by Rs 10 per box of 20 batteries.
In the foreign exchange market, the rupee edged lower against the dollar after the US Federal Reserve on Wednesday, 19 March 2014, announced a further reduction of monetary stimulus for the US economy and signaled US interest rates will be raised, potentially damping fund flows into emerging markets. The partially convertible rupee was hovering at 61.13, compared with its close of 60.95/96 on Wednesday, 19 March 2014.
Indian government bond prices dropped, tracking surge in yields on US Treasury notes on Wednesday, 19 March 2014, after the US Federal Reserve signaled it may raise US interest rates from the middle of next year. The yield on 10-year benchmark federal paper, 8.83% GS 2023, was hovering at 8.8305%, higher than its close of 8.7772% on Wednesday, 19 March 2014. Bond yield and bond prices move in opposite direction.
The Reserve Bank of India will announce the First Bi-monthly Monetary Policy Statement, 2014-15 on 1 April 2014. Citing price pressures, 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.
The next major trigger for the stock market is the outcome of the upcoming Lok Sabha elections. Lok Sabha elections will be held between 7 April 2014 and 12 May 2014 in nine phases. The counting of votes will be take place on 16 May 2014. The term of the current Lok Sabha expires on June 1 and the new House has to be constituted by May 31. Along with the Lok Sabha election, Andhra Pradesh (AP), including the regions comprising Telangana, Odisha and Sikkim will go to polls to elect new assemblies. AP, Odisha and Sikkim assemblies come to end on June 2, June 7 and May 7 respectively.
Asian stocks fell on Thursday, 20 March 2014, after the Federal Reserve signaled it may raise US interest rates from the middle of next year. Key benchmark indices in China, Hong Kong, Taiwan, Singapore, South Korea, Indonesia and Japan were off 0.59% to 2.29%.
China will keep economic growth at a reasonable rate while keeping inflation stable, Premier Li Keqiang reportedly said on Wednesday. Li also told a regular meeting of the State Council, or the cabinet, that China will continue to push forward reforms.
New Zealand's annual economic growth exceeded 3% for a second straight quarter, buoyed by dairy exports, adding to signs of increasing inflation pressure that may require higher borrowing costs. Gross domestic product increased 3.1% in the fourth quarter from a year earlier, Statistics New Zealand said in Wellington today. That's slower than the revised 3.3% pace in the third quarter. GDP rose 0.9% from the third quarter.
Trading in US index futures indicated that the Dow could drop 36 points at the opening bell on Thursday, 20 March 2014. US stocks dropped on Wednesday, 19 March 2014, as the Federal Reserve's latest policy statement raised jitters about the prospect of interest rates rising sooner than anticipated.
The Federal Reserve announced a further reduction in its bond-buying program by $10 billion to $55 billion after the conclusion of a monetary policy review on Wednesday, 19 March 2014. The purchases will finish by year-end with a borrowing-cost increase to follow in "around six months," Chair Janet Yellen indicated on Wednesday, 19 March 2014. The Federal Open Market Committee said on Wednesday, 19 March 2014, it will no longer link borrowing costs to a specific unemployment rate, and will consider a broad range of indicators on the labor market, inflation and financial markets instead. Separately, the Fed released forecasts showing more officials predicting the benchmark rate, now close to zero, will rise at least to 1% at the end of 2015 and 2.25% by the end of the following year, higher than previously forecast.
The US and Europe are moving to increase sanctions on Russia after Russian President Vladimir Putin signed an accord setting in motion Crimea's accession to Russian territory. With visa bans and asset freezes on Russian officials failing to sway Putin, European Union leaders meet today, 20 March 2014, to consider their next move. Ukraine on Wednesday, 19 March 2014, ordered the removal of its military from the majority Russian-speaking Crimea and said it will strengthen its deployments on the country's border with Russia.
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