Key benchmark indices dropped sharply led by slide in index pivotals Reliance Industries, HDFC and HDFC Bank. The barometer index, the S&P BSE Sensex, lost 363.05 points or 1% at 35,891.52, as per the provisional closing data. The Nifty 50 index lost 117.60 points or 1.08% at 10,792.50, as per the provisional closing data. The Sensex provisionally settled below the psychological 36,000 mark. Negative global stocks weighed on the domestic bourses.
Volatility was high. Trading for the day began on a subdued note as the key benchmark indices drifted lower in early trade on negative Asian stocks. Key indices cut losses in morning trade. Stocks once again turned weak in mid-morning trade after latest data showed that manufacturing activity slowed in December. Shares extended intraday fall in early afternoon and afternoon trade. Indices hit intrday low in mid-afternoon trade. Stocks cut losses in late trade.
The S&P BSE Mid-Cap index dropped 1.26%. The S&P BSE Small-Cap index fell 0.74%.
The market breadth, indicating the overall health of the market, was weak. On the BSE, 956 shares rose and 1594 shares fell. A total of 167 shares were unchanged.
Vedanta lost 4.48%. According to media reports, the Tamil Nadu government on Wednesday, 2 January 2019, moved the Supreme Court challenging the National Green Tribunal's order to reopen Vedanta's Sterlite copper plant in Thoothukudi. In its petition, the state government argued that the tribunal has no jurisdiction to hear the matter.
The green tribunal had last month set aside the state government's order to shut down the plant and described the All India Anna Dravida Munnetra Kazhagam-led government's order as "unjustifiable". It had directed the Tamil Nadu Pollution Control Board to issue a fresh order of renewal of consent for the smelter within three weeks. The state government had then said it would challenge the order in the Supreme Court.
However, the Madras High Court on 21 December 2018 had restrained Vedanta from reopening the plant after protests by activists and local groups. The Madurai branch of the High Court had said that the status quo would remain in effect until 21 January 2019.
Bajaj Auto fell 1.29%. The company reported 18% growth in its total vehicles sales to 3.46 lakh units in December 2018 over December 2017. The announcement was made during market hours today, 2 January 2019.
Hero MotoCorp lost 2.64%. In December 2018, Hero MotoCorp sold 453,985 units, compared to 472,731 units in December 2017. The announcement was made during market hours today, 2 January 2019.
Tata Motors lost 2.91%. The trend of muted consumer sentiments continued in December 2018, impacting the sales performance of Tata Motors commercial and passenger vehicles business in the domestic market, which dropped by 8% at 50,440 units as against 54,627. In December 2018, liquidity crisis in the industry, higher interest rates and rising fuel costs continued to impact the commercial vehicle sales, with M&HCV (medium and heavy commercial vehicle) and I&LCV (intermediate and light commercial vehicles) segment witnessing a decline while the passenger vehicle business bounced back. Tata Motors' sales from exports (from CV and PV) in December 2018 was at 3,999 units as against 6,293 units in December 2017, lower by 36%, due to sharp TIV (total industry volume) contraction in Bangladesh due to elections and political uncertainty in Sri Lanka.
Coal India fell 1.7%. Coal India announced the provisional production and offtake figures of the company and its subsidiaries in December 2018. Production fell 0.9% to 54.13 million tonne in December 2018 over December 2017. Offtake fell 1.2% to 52.77 million tonne in December 2018 over December 2017. The announcement was made after market hours yesterday, 1 January 2019.
On the macro front, the health of India's manufacturing economy improved further at the end of the year, as companies continued to scale up production and employment in response to strong inflows of new business, data released today showed. Posting 53.2 in December, from 54 in November, the Nikkei India Manufacturing Purchasing Managers' Index (PMI) was consistent with a further improvement in operating conditions across the sector.
Overseas, European and Asian shares fell after data showed Chinese factory activity contracted in December. China's factory activity contracted for the first time in 19 months in December as domestic and export orders continued to weaken, data released today showed. The Caixin/Markit Manufacturing Purchasing Managers' Index (PMI) fell to 49.7 in December from 50.2 in November, marking the first contraction since May 2017.
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