Fears of a hike in its main lending rate viz. the repo rate by the Reserve Bank of India (RBI) after a monetary policy review this week weighed on the bourses after the latest data showed acceleration of inflation based on the wholesale price index (WPI) to a 14-month high of 7.52% in November 2013. The WPI data comes close on the heels of last week's data showing record high consumer price inflation in November 2013. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, settled at 2-1/2-week low. The Sensex shed 56.06 points or 0.27%, up close to 20 points from the day's low and off about 105 points from the day's high. The market was volatile as the Sensex alternately swung between positive and negative terrain throughout the day. The market breadth, indicating the overall health of the market, was negative.
Indian stocks dropped for the fifth day in a row today, 16 December 2013. The Sensex has lost 666.90 points or 3.12% in five trading sessions from a recent high of 21,326.42 on 9 December 2013. The Sensex has fallen 132.41 points or 0.63% in this month so far (till 16 December 2013). The Sensex has garnered 1,232.81 points or 6.34% in calendar 2013 so far (till 16 December 2013). From a 52-week low of 17,448.71 on 28 August 2013, the Sensex has risen 3,210.81 points or 18.4%. From a record high of 21,483.74 hit on 9 December 2013, the Sensex is off 824.22 points or 3.83%.
Coming back to today's trade, IT stocks rose on renewed buying, HCL Technologies hitting record high. index heavyweight and cigarette major ITC declined on high volume. Index heavyweight Reliance Industries extended intraday fall in late trade. Banking and realty stocks declined on speculation the Reserve Bank of India (RBI) will hike its main lending rate viz. the repo rate after a policy review this week as inflation accelerated in November 2013. Tata Motors dropped after the company reported fall in global wholesales in November 2013. GlaxoSmithkline Pharmaceuticals jumped after its overseas parent GlaxoSmithkline plc announced a voluntary open offer to acquire additional 2.06 crore equity shares of the company at a substantial premium to the ruling market price.
The market sentiment was hit adversely after the latest data showed that foreign institutional investors (FIIs) were net sellers of Indian stocks on Friday, 13 December 2013. FIIs sold shares worth a net Rs 432.02 crore on Friday, 13 December 2013, as per provisional data from the stock exchanges.
The S&P BSE Sensex lost 56.06 points or 0.27% to settle at 20,659.52, its lowest closing level since 28 November 2013. The index fell 77.81 points at the day's low of 20,637.77 in late trade. The index rose 48.94 points at the day's high of 20,764.52 in morning trade.
The CNX Nifty lost 13.70 points or 0.22% to 6,154.70 its lowest closing level since 28 November 2013. The index hit a low of 6,146.05 and a high of 6,183.25 in intraday trade.
The BSE Mid-Cap rose 0.3% and the BSE Small-Cap index gained 0.36%. Both these indices outperformed the Sensex.
The S&P BSE FMCG index (down 0.49%), the S&P BSE Oil & Gas index (down 1.61%), and the S&P BSE Auto index (down 0.7%) and underperformed the BSE Sensex.
The S&P BSE Metal index (up 0.2%), the S&P BSE Bankex (down 0.05%), the S&P BSE Power index (up 0.33%), the S&P BSE Realty index (up 0.13%), the S&P BSE IT index (up 1.56%), the S&P BSE Consumer Durables index (up 1.2%), the S&P BSE Teck index (up 1.03%), the S&P BSE Healthcare index (up 0.81%) and the S&P BSE Capital Goods index (up 0.44%) outperformed the BSE Sensex.
The total turnover on BSE amounted to Rs 1692 crore, lower than Rs 1750.30 crore on Friday, 13 December 2013.
The market breadth, indicating the overall health of the market, was negative. On BSE, 1,326 shares dropped and 1,105 shares rose. A total of 181 shares were unchanged.
Among the 30-share Sensex pack, 16 stocks declined and rest of them gained.
Index heavyweight and cigarette major ITC was off 0.59% at Rs 313.20 on high volume of 20.19 lakh shares. The stock was volatile. The scrip hit high of Rs 315.40 and low of Rs 310.75.
Index heavyweight Reliance Industries lost 2.14% to Rs 844.90, with the stock extending intraday losses in late trade. The scrip hit high of Rs 861.50 and low of Rs 842.25.
Bank stocks declined on speculation the Reserve Bank of India (RBI) will hike its main lending rate viz. the repo rate after a policy review this week as inflation accelerated in November 2013. HDFC Bank (down 0.67%), Yes Bank (down 0.93%), Kotak Mahindra Bank (down 1.09%), State Bank of India (SBI) (down 0.72%), Canara Bank (down 0.77%), Union Bank of India (down 1.47%), Bank of India (down 1.36%), Bank of Baroda (down 0.23%) and Punjab National Bank (down 0.1%) declined.
ICICI Bank rose 0.97% at Rs 1,096. The stock was volatile. The scrip hit high of Rs 1,104 and low of Rs 1,086.
Tata Motors fell 0.85%. Tata Motors' global wholesales fell 19.91% to 81,957 units in November 2013 over November 2012. Global wholesales for Jaguar Land Rover rose 15.31% to 39,956 vehicles in November 2013 over November 2012.
Maruti Suzuki India rose 0.44%. Mahindra & Mahindra (M&M) slipped 2.14%.
Shares of two wheeler makers declined. Bajaj Auto (down 0.19%) and Hero MotoCorp (down 1.15%) declined.
IT stocks rose. Infosys gained 2.25%. Wipro rose 1.01%.
HCL Technologies rose 1.01% to Rs 524.20 after hitting record high of Rs 1,097.40 in intraday trade.
TCS rose 0.72%. TCS said during market hours that it has fully integrated the ICT infrastructure of Royal Haskoning and DHV in a record time of six months. Royal Haskoning and DHV merged in 2012 under the new name Royal HaskoningDHV. Due to the swift and successful integration, TCS has been upgraded to 'strategic partner' for Royal HaskoningDHV, TCS said in a statement.
TCS announced earlier during the day that CUA, Australia's largest customer-owned financial institution, has implemented TCS BaNCS to reengineer its core banking and online banking system. The new solution expands CUA's capability to deliver more flexible and innovative products and services to customers. TCS BaNCS will also enable CUA to improve internal processes and efficiencies as well as facilitate enhanced customer service.
Tech Mahindra rose 2.9% to Rs 1,741.25.
Capital goods pivotals edged higher. Bharat Heavy Electricals (Bhel) (up 0.06%) and L&T (up 0.83%) gained.
Most pharma stocks dropped. Cipla (down 0.17%), Dr Reddy's Laboratories (down 0.06%), Ranbaxy Laboratories (down 1.47%) and Sun Pharmaceutical Industries (down 2.47%) declined.
Aurobindo Pharma jumped 12.62% to Rs 348.95, after hitting a record high of Rs 337.60 in intraday trade. The stock extended Friday's 3.99% gains triggered by the company receiving the final approval from USFDA to manufacture and market a generic medicine in the United States.
Aurobindo Pharma during trading hours on Friday, 13 December 2013 said it has received the final approval from the US Food & Drug Administration (USFDA) to manufacture and market Duloxetine Hydrochloride Delayed-Release Capsules 20mg (base), 30mg (base) and 60mg (base) which was earlier tentatively approved.
Duloxetine Hydrochloride Delayed-Release Capsules 20mg (base), 30mg (base) and 60mg (base) are the generic equivalent of Eli Lilly & Company's Cymbalta Delayed-Release Capsules 20mg (base), 30mg (base) and 60mg (base). Duloxetine Hydrochloride Delayed-Release Capsules are indicated for the treatment of for the treatment of major depressive disorder (MDD) and falls under the Neurological (CNS) therapeutic category. According to IMS data, the market size of the product is estimated to be $5.4 billion for the twelve months ended September 2013.
Aurobindo now has a total of 188 abbreviated new drug application (ANDA) approvals (163 final approvals including 7 from Aurolife Pharma LLC and 25 tentative approvals) from USFDA.
GlaxoSmithkline Pharmaceuticals jumped 18.6% to Rs 2,927.40. The scrip hit record high of Rs 2,952 in intraday trade. GlaxoSmithKline Pte along with GlaxoSmithkline plc today, 16 December 2013, announced a voluntary open offer to the public shareholders of GlaxoSmithkline Pharmaceuticals to acquire 2.06 crore equity shares, representing 24.33% stake of the total voting share capital of the company, at Rs 3,100 per share, at a premium of 25.58% over the closing price of GlaxoSmithkline Pharmaceuticals' shares on Friday, 13 December 2013.
GlaxoSmithkline plc currently holds 50.67% stake in GlaxoSmithkline Pharmaceuticals. Its stake will rise to 75% if it gets the entire 2.06 crore equity shares through the voluntary open offer. The hike in stake will cost the overseas parent about Rs 6389 crore.
Shares of some Indian units of MNCs rose as an open offer for GlaxoSmithkline Pharmaceuticals by its overseas parent raised expectations that foreign parents of other Indian units of MNCs may at some stage take similar course.
Merck, Fulford (India), 3M India, Astrazeneca Pharma India, Linde India, Goodyear India, Siemens, Bosch, Federal-Mogul Goetze (India), Novartis India, Oracle Financial Services Software, DIC India and Ricoh India rose 0.26% to 6.17%.
Realty stocks declined on speculation the Reserve Bank of India (RBI) will hike its main lending rate viz. the repo rate after a policy review this week as inflation accelerated in November 2013. Purchases of both residential and commercial property are largely driven by finance. Indiabulls Real Estate (down 1.07%), HDIL (down 2.07%), Unitech (down 1.63%), Sobha Developers (down 7.28%), and Parsvnath Developers (down 0.81%) declined. DLF rose 0.6%.
Tata Chemicals fell 1.23% after the central bank restricted foreign institutional investors from purchasing shares of the company as the foreign shareholding in the company has reached the trigger limit.
The Reserve Bank of India (RBI) notified on Friday, 13 December 2013, that the foreign share holdings by foreign institutional investors (FIIs) in Tata Chemicals has reached the trigger limit of 22%. Hence, further purchases of equity shares of the company would be allowed only after obtaining prior approval of RBI, the central bank said in a statement.
SpiceJet surged 7.64% after the company said it has signed a three-year interline agreement with Tigerair, Singapore's largest budget airline. The announcement was made during trading hours today, 16 December 2013.
SpiceJet and Tigerair have signed a three-year interline agreement to pave the way for greater connectivity between flights operated by both carriers, the budget carriers said in a joint statement. SpiceJet is the first Indian low fare airline to establish such an arrangement with a foreign airline. This partnership will result in a major boost for tourism and business travel between the two countries, SpiceJet and Tigerair said.
Starting from 6 January 2014, customers travelling on SpiceJet's domestic network from 14 Indian cities can enjoy seamless connection through Hyderabad's Rajiv Gandhi International Airport onto Tigerair's Singapore-bound flights. The 14 Indian cities are Ahmedabad, Bhopal, Chennai, Kolkata, Coimbatore, Delhi, Goa, Indore, Mangalore, Madurai, Pune, Bengaluru, Tirupati, and Visakhapatnam (Vizag).
Starting from 12 January 2014, Tigerair customers from Singapore will also enjoy easy access to SpiceJet's wide domestic network, making their holiday and business travel more seamless.
Sanjiv Kapoor, Chief Operating Officer of SpiceJet said: "We are glad to announce the interline partnership that brings two leading low fare Asian carriers together. This is a historic moment for SpiceJet and Tigerair. This partnership will hugely benefit travelers from India and Singapore, and represents one of the building blocks of the emerging new SpiceJet".
Group Chief Commercial Officer of Tigerair Mr Alexander Knigge said: "India is one of our key markets and we are excited to expand our footprint there through this interline partnership with SpiceJet. We look forward to build a win-win partnership and delivering even more travel options to our customers".
Tigerair, established in 2004, is a leading Singapore-based no-frills airline that offers affordable travel options and a seamless customer experience. Tigerair comprises four airlines, namely Tigerair Singapore, Tigerair Mandala, Tigerair Philippines and Tigerair Australia. Collectively, the Group's network extends to over 50 destinations across 13 countries in the Asia Pacific. Tigerair operates a fleet of 50 Airbus A320-family aircraft, averaging less than three years of age.
Essar Ports fell 0.27% in choppy trade. The company after market hours on Friday, 13 December 2013, said its wholly-owned subsidiary has entered into a concession agreement with Visakhapatnam Port Trust for development and operations of three iron ore berths. Essar Ports said that Essar Vizag Terminals, a wholly-owned subsidiary of the company, has entered into a concession agreement with Visakhapatnam Port Trust for development and operations of three iron ore berths at Visakhapatnam Port on BOT basis over a Period of 30 years. These three berths (two outer harbor berths and one inner harbor berth) will have a combined capacity of 23 million metric tons per annum (MMTPA).
The project will be developed at a cost of Rs 1200 crore over a period of three years. Essar Ports will take over the two outer harbor berths soon and the operation and up gradation of the terminal will happen simultaneously. Vishakhapatnam port handled 12.3 million tons of iron ore during FY13 and this traffic is readily available for these berths from commencement.
Commenting on this Rajiv Agarwal, Managing Director, Essar Ports said: "We will develop the terminal to create one of the most competitive, modernized, world class facilities. This project will significantly increase our third party cargo handling capacity and also boost our presence in the east coast. Iron ore export traffic at Vizag will increase substantially due to the competitiveness of this terminal which will facilitate industrial growth in the region."
This project will increase Essar Ports' total capacity for iron ore export on the east coast to 39 MMTPA with 4 highly mechanized iron ore berths (three in Visakhapatnam Port and one in Paradip Port).
Inflation based on the wholesale price index (WPI) accelerated to 7.52% in November 2013, from 7% in October 2013, data released by the government today, 16 December 2013, showed. Core inflation or non-food manufacturing inflation accelerated to 2.64% in November 2013, from 2.58% in October 2013, the latest data showed.
WPI for September 2013 was revised upwards to 7.05% from 6.46% reported earlier. Build up inflation rate in the financial year so far was 6.7% compared to a build up rate of 4.84% in the corresponding period of the previous year.
Data released by the government last week showed that inflation based on the consumer price index (CPI) stood at a record 11.24% last month.
The Reserve Bank of India (RBI) announces Mid-Quarter Review of Monetary Policy for 2013-14 on Wednesday, 18 December 2013. The Third Quarter Review of Monetary Policy for 2013-14 is scheduled on 28 January 2014.
In the foreign exchange market, the rupee strengthened past 62 against the dollar. The partially convertible rupee was hovering at 61.745, compared with its close of 62.125/135 on Friday, 13 December 2013.
The Central Board of Direct Taxes (CBDT) on Friday, 13 December 2013, extended the time limit for payment of the December installment of Advance Tax by two days from 15 December 2013 to 17 December 2013. This was done in view of the fact that 15 December 2013 was a Sunday.
European stocks reversed initial losses on Monday, 16 November 2013, after a gauge of manufacturing in the euro area rose more than forecast. Key benchmark indices in UK, Germany and France were up 0.46% to 1.13%.
A Markit Economics report showed that euro-area flash manufacturing index rose to 52.7, a 31-month high, from 51.6 in November. The gauge has been above 50, indicating expansion, for six months.
The German economy ended 2013 positively, according to a survey released Monday, with new business, confidence and employment all growing in December. Data provider Markit's preliminary composite purchasing managers index was little changed in December, slipping marginally to 55.2 from 55.4 in November. A reading above 50 denotes growth. The change in the composite PMI came as the manufacturing sector strengthened in December from November, while services providers posted a slightly slower pace of growth than a month earlier.
The survey was positive across the board and bodes well for the fourth quarter economic performance. Incoming business rose at the fastest pace for two-and-a-half years, while job creation, output levels and backlogs of work were also stronger in December.
Asian stocks edged lower on Monday, 16 December 2013, after a gauge of Chinese manufacturing fell and as investors awaited a Federal Reserve meeting this week to gauge the timing of stimulus cuts. Key benchmark indices in Taiwan, Hong Kong, China, Singapore, South Korea, Japan and Indonesia were off 0.09% to 1.62%. Fed's bond-buying program has been a source of liquidity for most Asian and emerging markets this year.
The HSBC Holdings Plc/Markit Economics preliminary manufacturing purchasing managers' index for China fell to 50.5 in December from 50.8 in November. Readings above 50 signal expansion.
Japan's quarterly Tankan index for large manufacturers rose to the highest since 2007 in October 2013, climbing to 16 from 12 in September 2013, according to the Bank of Japan. Positive figures indicate optimists outnumber pessimists.
The Bank of Japan (BoJ), which buys more than 7 trillion yen ($67.6 billion) of Japanese Government Bonds (JGBs) every month in its bid to stoke inflation, holds a two-day monetary policy meeting on 19 and 20 December 2013.
Trading in US index futures indicated that the Dow could jump 58 points at the opening bell on Monday, 16 December 2013. US stocks made a mild rebound Friday but ended the week lower, as investors looked toward a Federal Reserve meeting next week that could start the curtailment of the Fed's equities-boosting stimulus program.
The Federal Open Market Committee's (FOMC) two-day policy meeting on interest rates in the United States begins tomorrow, 17 December 2013. The US central bank currently buys bonds worth $85 billion a month in a bid to hold interest rates low and encourage economic growth in the world's biggest economy. Minutes of the Fed's October meeting released on 20 November 2013 showed officials may reduce their $85 billion a month of bond buying if the economy improves as anticipated.
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