Key benchmark indices hovered in negative terrain in mid-morning trade as weakness in rupee against the dollar hurt sentiment. The barometer index, the S&P BSE Sensex was down 115.62 points or 0.61%, off about 235 points from the day's high and up close to 85 points from the day's low. The market breadth, indicating the overall health of the market, turned negative from positive. Most bank stocks edged lower.
A bout of volatility was witnessed as key benchmark indices slipped into the red after opening higher. It weakened and hit fresh intraday low in morning trade. It hovered in negative terrain in mid-morning trade.
The partially convertible rupee was trading 66.78 lower than Monday's close of 66. Rupee depreciation fuels inflation, increases import bill and current account deficit. It also increases the government's spending on fuel subsidies, potentially widening the fiscal deficit.
At 11:20 IST, the S&P BSE Sensex was down 115.62 points or 0.61% to 18,770.51. The index fell 201.66 points at the day's low of 18,684.47 in morning trade. The index rose 121.18 points at the day's high of 19,007.31 in opening trade, its highest level since 16 August 2013.
The CNX Nifty was down 49.55 points or 0.89% to 5,501.20. The index hit a low of 5,482.30 in intraday trade. The index hit a high of 5,580.95 in intraday trade, its highest level since 16 August 2013.
The market breadth, indicating the overall health of the market, turned negative from positive. On BSE, 794 shares fell and 768 shares rose. A total of 93 shares were unchanged.
Among the 30-share Sensex pack, 19 stocks fell and rest of them rose. HDFC (down 3.7%), Hero MotoCorp (down 3.49%) and HDFC Bank (down 1.96%), edged lower from the Sensex pack.
Most bank stocks edged lower. Among private sector banks, ICICI Bank (down 1.41%), HDFC Bank (down 1.21%) and Kotak Mahindra Bank (down 0.52%), edged lower
State Bank of India (SBI) rose 0.35%. The bank said after market hours on Monday, 2 September 2013 that it has acquired 23% shares of Bank State Bank of India, Indonesia (BSBII) in a recent deal with P. T. Ravindo Jaya. As per the present State Bank of India holds 99% in BSBII and P. T. Ravindo Jaya holds 1%.
Among other PSU bank stocks, Canara Bank, Union Bank of India, Bank of India, and Punjab National Bank shed by 0.76% to 1.94%.
The combined index of eight core industries rose 3.1% in July 2013 over July 2012. The eight core industries have a combined weight of 37.90% in the Index of Industrial Production (IIP).
The Rajya Sabha on Monday approved a $20 billion scheme to distribute subsidised wheat and rice to 80 crore people, backing an anti-malnutrition drive that investors fear will mean missing the fiscal deficit target. The Food Security Bill is seen as a vote winner by the ruling Congress party as it prepares for elections due by May next year. But investors reacted negatively to the plan when the lower house approved it last weak, on worries the government will struggle to contain the cost of subsidies. The scheme has now been passed by both houses. Before becoming law it must be signed by the president, a formality.
Asian stocks climbed on Tuesday on evidence of a pickup in global manufacturing. Key benchmark indices in China, Hong Kong, South Korea, Japan, Indonesia, and Taiwan rose by 0.4% to 2.87%. Singapore's Straits Times fell 0.07%.
China's official purchasing managers' index (PMI) for the non-manufacturing sector dipped slightly to 53.9 in August from July's 54.1, the National Bureau of Statistics (NBS) said on Tuesday. A reading above 50 indicates activity in the sector is accelerating, while one below 50 indicates it is slowing. The services sector index followed the bureau's manufacturing PMI on Sunday, which showed China's factory activity expanded at the fastest pace in more than a year in August with a jump in new orders.
Australia's central bank left its key interest rate unchanged on signs of a pickup in housing and as a slide in the currency eases pressure on the economy before an election that polls suggest will change the government. Governor Glenn Stevens and his board kept the overnight cash-rate target at a record-low 2.5%, the Reserve Bank of Australia said in a statement today in Sydney.
Trading in US index futures indicated that the Dow could gain 127 points at the opening bell on Tuesday, 3 September 2013. US stock markets remained closed on Monday, 2 September 2013, for the Labor Day holiday.
Investors across the globe are eyeing the next policy meeting of the Federal Open Market Committee (FOMC) scheduled this month, with their focus squarely on the timing of tapering of Federal Reserve's bond purchases. The FOMC holds a two-day policy meeting on 17-18 September 2013 to decide on interest rates in the United States. The US central bank currently buys $85 billion a month in US debt and mortgage-backed securities in a bid to hold interest rates low and encourage economic growth. Federal Reserve Chairman Ben Bernanke has on several occasions stressed that the tapering process is dependent on an improvement in data. Fed's bond-buying program has kept global markets flush with liquidity in recent years.
President Barack Obama on Saturday, 31 August 2013 said he has decided military action is appropriate, but he would still seek congressional authorization on the use of US military force against Syria. Congressional leaders have agreed to debate and vote on the possible action when lawmakers return from recess on September 9. And, while lawmakers aren't due back in Washington until next week, the Senate Foreign Relations Committee said it would hold hearings on Syria today and tomorrow.
Powered by Capital Market - Live News
