Weakness continued on the bourses in mid-morning trade. The barometer index, the S&P BSE Sensex, was down 164.23 points or 0.79%, up 49.60 points from the day's high and off 321.82 points from the day's high. The market breadth, indicating the overall health of the market, was negative. The market sentiment was hit adversely after the Federal Open Market Committee (FOMC) after a two-day monetary policy meeting on Wednesday, 18 December 2013, announced plans to cut US Federal Reserve's monthly bond purchases to $75 billion from $85 billion, taking its first step toward unwinding the unprecedented stimulus put in place to help the US economy recover from the worst recession since the 1930s. The decision of the US central bank triggered fears of slowdown in inflow from foreign institutional investors in India. Fed's bond-buying program had become a source of funds for investment in Indian as well as other emerging markets in recent years. In the foreign exchange market, the rupee edged lower against the dollar.
Index heavyweight and cigarette major ITC edged lower. IT stocks rose as the rupee edged lower against the dollar, with Infosys and HCL Technologies hitting record high and Wipro and Tech Mahindra hitting 52-week high. Pharma stocks extended their recent gains.
Volatility ruled the roost in early trade as the key benchmark indices reversed direction after a firm opening. The Sensex fell below the psychological 21,000 level soon after breaching that level at the onset of the trading session. Key benchmark indices extended initial losses in morning trade. Weakness persisted on the bourses in mid-morning trade.
At 11:16 IST, the S&P BSE Sensex was down 164.23 points or 0.79% to 20,695.63. The index lost 213.83 points at the day's low of 20,646.03 in morning trade. The index jumped 157.59 points at the day's high of 21,017.45 in early trade, its highest level since 12 December 2013.
The CNX Nifty was down 52.65 points or 0.85% to 6,164.50. The index hit a low of 6,150.70 in intraday trade. The index hit a high of 6,263.75 in intraday trade, its highest level since 12 December 2013.
The market breadth, indicating the overall health of the market, was negative. On BSE, 982 shares declined and 871 shares rose. A total of 125 shares were unchanged. The breadth alternately swung between positive and negative zone so far during the day.
The total turnover on BSE amounted to Rs 1329 crore by 11:15 IST, compared with Rs 841 crore by 10:15 IST.
Among the 30-share Sensex pack, 20 stocks declined and rest of them gained.
Index heavyweight and cigarette major ITC reversed initial upmove in volatile trade. The stock fell 1.22% at Rs 311.90. The stock hit a high of Rs 316.95 and low of Rs 311.40 so far during the day.
IT stocks rose as the rupee edged lower against the dollar. A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports.
IT major Infosys rose 1.8% to Rs 3,519.90. The stock hit record high of Rs 3,540 in intraday trade.
Wipro gained 1.65% to Rs 531. The stock hit 52-week high of Rs 533.35 in intraday trade.
Tata Consultancy Services (TCS) rose 2.03%. The company on Wednesday, 18 December 2013, announced that MyState, an ASX-listed diversified financial Group in Australia, has implemented TCS BaNCS for core banking. The implementation realises further benefits of the merger between MyState and The Rock, a major provider of financial and insurance services to the Central Queensland region. MyState, with an integrated, scalable core banking platform, can now further support its growth opportunities through improved products and services, and simpler, faster business processes and operations, TCS said.
HCL Technologies rose 3.54% to Rs 1,240 after striking a record high of Rs 1,257 in intraday trade.
Tech Mahindra gained 2.89% to Rs 1,778.50. The stock hit 52-week high of Rs 1,781 in intraday trade.
Pharma stocks extended recent gains. Cipla (up 1.13%), Dr Reddy's Laboratories (up 0.75%), Ranbaxy Laboratories (up 2.27%), Cadila Healthcare (up 0.48%), and Sun Pharmaceutical Industries (up 1.97%) advanced.
Lupin rose 2.54%. The company during market hours on Wednesday, 18 December 2013, announced that its US subsidiary -- Lupin Pharmaceuticals Inc. -- has launched its Abacavir Sulfate, Lamivudine, and Zidovudine Tablets, 300 mg (base)/150 mg/300 mg in the US after the US District Court for the District of Delaware ruled that the Lupin's generic version of Trizivir did not infringe on patents. Lupin had earlier received approval for the drug. Lupin's Abacavir Sulfate, Lamivudine Zidovudine 300mg (Base)/150mg/300mg Tablets are the AB-rated generic equivalent of ViiV Healthcare's (ViiV) Trizivir Tablets, 300 mg (base)/150 mg/300mg and are indicated in combination with other antiretrovirals or alone for the treatment of HIV-1 infection.
Lupin is the first applicant to file an ANDA for Trizivir Tablets and as such is entitled to 180 days of marketing exclusivity, the company said in a statement. Trizivir Tablets, 300 mg (base)/150 mg/300mg had annual US sales of approximately $111.6 million, as per IMS MAT September 2013 data.
Aurobindo Pharma rose 1.74% to Rs 382.85, after hitting a record high of Rs 390 in intraday trade.
Biocon rose 0.82%, with the stock extending Wednesday's 11.38% surge triggered by the company's announcement that it has entered into a licensing and collaboration agreement with Quark Pharmaceuticals, Inc. for the development of a range of small interfering RNA based novel therapeutics. The announcement was made during trading hours on Wednesday, 18 December 2013. The collaboration will enable Biocon to co-develop, manufacture & commercialize QPI-1007, a novel small interfering RNA (siRNA) drug candidate for ophthalmic conditions, for India and other key markets, Biocon and Quark Pharmaceuticals, Inc. (Quark) said in a combined statement.
Biocon will have access to Quark's innovative and proprietary siRNA technology platform that can be leveraged for the development of novel therapeutics for various unmet medical needs.
An expert team of scientists from Quark and Biocon will jointly work on the development of QPI-1007, and the additional novel pipeline, leveraging the siRNA innovative technology, the statement said.
Wockhardt jumped 5.57% after the company said that its Swiss arm will list on the Berne Stock Exchange in Switzerland today, 19 December 2013. Wockhardt's Swiss arm, Wockhardt Bio AG, had offered 23.48 lakh ordinary shares of Swiss Franc (CHF) 1 each, representing 5% of the post diluted capital, for subscription at a price of CHF 5.05 per ordinary share in its initial public offering (IPO).
The ordinary shares of Wockhardt Bio AG are scheduled to be listed today, 19 December 2013 on the Berne Stock Exchange in Switzerland.
Wockhardt Bio AG is the holding company for the pharmaceutical and biotech firm's international operations. Close to 75% of Wockhardt's business comes from outside India and some of the major geographies where it is present include the US, the UK, Ireland and France.
Shares of Strides Arcolab dropped 57.41% to Rs 376 as the stock turned ex-dividend today, 19 December 2013, for special dividend of Rs 500 per share. The company announced the large special dividend after concluding the sale of its Agila Specialties Division to Mylan Inc. early this month.
In the foreign exchange market, the rupee edged lower against the dollar after the Federal Open Market Committee (FOMC) after a two-day monetary policy meeting on Wednesday, 18 December 2013, announced plans to cut US Federal Reserve's monthly bond purchases to $75 billion from $85 billion, taking its first step toward unwinding the unprecedented stimulus put in place to help the US economy recover from the worst recession since the 1930s. The partially convertible rupee was hovering at 62.405, compared with its close of 62.09/10 on Wednesday, 18 December 2013.
Asian markets edged higher on Thursday, 19 December 2013, after the US Federal Reserve expressed enough confidence in the US labor market to taper asset purchases while still promising to hold interest rates close to zero in the world's biggest economy. Key benchmark indices in Taiwan, Hong Kong, Singapore, Japan, Indonesia and South Korea rose by 0.01% to 1.82%. China's Shanghai Composite fell 0.28%.
The Bank of Japan's (BoJ) two-day monetary policy meeting begins today, 19 December 2013. The Japanese central bank currently buys more than 7 trillion yen ($67.6 billion) of Japanese Government Bonds (JGBs) every month in its bid to stoke inflation.
Trading in US index futures indicated that the Dow could drop 24 points at the opening bell on Thursday, 19 December 2013. US markets soared with the Dow Jones Industrial Average and the S&P 500 closing at all-time highs on Wednesday as markets interpreted the Federal Reserve's decision to begin the tapering of bond purchases in January as confidence in the underlying strength of the economy and welcomed its commitment to low rates for a considerable time.
The Federal Reserve on Wednesday took the first step to exiting from its controversial bond-buying program, showing greater confidence that the US economy will grow faster and hiring will pick up over the next year. Starting in January, the Fed will reduce the pace of asset purchases to $75 billion from $85 billion a month. And if the economy improves at the pace the Fed expects, outgoing Chairman Ben Bernanke said in a press conference that he could foresee the bond-purchase program coming to an end by late next year. "We are hopeful the economy will continue to show progress," Bernanke said, and return to a "more normal" path of growth. The central could taper at each meeting if the economy continues to improve. He didn't rule out pausing if the economy stumbles or tapering more quickly if growth surprises to the upside.
The Fed split the reduction in asset purchases evenly between Treasurys and mortgage-backed securities. It will now purchase $40 billion per month of Treasurys, down from $45 billion, and $35 billion of mortgage-related securities, down from $40 billion.
In an effort to keep market rates stable, the Fed stressed that it will be in no hurry to raise short-term interest rates. The central bank added new language that it plans to maintain the target Fed funds rates "well past the time that the unemployment rate declines below 6.5%".
The US Senate on Wednesday, 18 December 2013, cleared and sent to President Barack Obama a $1.01 trillion budget deal, lowering the US deficit over 10 years and easing $63 billion in automatic spending cuts. The plan keeps in place about half of the reductions known as sequestration for next year, and about three-quarters of the planned cuts for 2015.
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