Key benchmark indices cut losses after hitting fresh intraday low in mid-morning trade. The barometer index, the S&P BSE Sensex, was down 207.52 points or 1.04%, up 60.55 points from the day's low and off 179.98 points from the day's high. The market breadth, indicating the overall health of the market, turned negative from positive in mid-morning trade. Investor sentiment was hit adversely as Asian stocks fell as lawmakers in Washington remain deadlocked over extending the nation's debt limit to avoid default. In the foreign exchange market, the rupee dropped against the dollar.
Index heavyweight and cigarette major ITC was off the day's low. Another index heavyweight Reliance Industries (RIL) hovered in red. IT stocks gained as the rupee dropped against the dollar, with HCL Technologies hitting record high and Tech Mahindra striking 52-week high. Shares of Just Dial tumbled after Friday's rally. Bombay Dyeing and Manufacturing Company jumped on reports that at least three private equity funds are in talks to buy up to a 24% stake in the company.
Key benchmark indices edged lower in early trade on weak Asian stocks. Weakness continued on the bourses in morning trade. Key benchmark indices cut losses after hitting fresh intraday low in mid-morning trade.
In the foreign exchange market, the rupee dropped against the dollar. The partially convertible rupee was hovering at 61.82, weaker than its close of 61.43/44 on Friday, 4 October 2013. The Reserve Bank of India (RBI) will look at easing restrictions on the forex futures market once the rupee stabilises, Deputy Governor H.R. Khan said on Monday, 7 October 2013. The RBI is also in talks with stock market regulator Securities and Exchange Board of India (Sebi) on making the dollar-rupee over-the-counter and futures market trades on a delivery basis, Khan said on the sidelines of an event. The central bank will look at the "whole gamut of futures market" once stability improves in the forex market, Khan added.
Foreign institutional investors (FIIs) bought shares worth a net Rs 541.36 crore on Friday, 4 October 2013, as per provisional data from the stock exchanges.
At 11:15 IST, the S&P BSE Sensex was down 207.52 points or 1.04% to 19,708.43. The index lost 268.07 points at the day's low of 19,647.88 in mid-morning trade, its lowest level since 3 October 2013. The index fell 27.54 points at the day's high of 19,888.41 in early trade.
The CNX Nifty was down 63.25 points or 1.07% to 5,844.05. The index hit a low of 5,825.85 in intraday trade, its lowest level since 3 October 2013. The index hit a high of 5,895.25 in intraday trade
The market breadth, indicating the overall health of the market, turned negative from positive in mid-morning trade. On BSE, 962 shares declined and 866 shares gained. A total of 121 shares were unchanged.
The total turnover on BSE amounted to Rs 698 crore by 11:20 IST compared to Rs 489 crore by 10:20 IST.
Among the 30-share Sensex pack, 17 stocks declined and rest of them gained.
Index heavyweight and cigarette major ITC lost 1.5% to Rs 335. The stock hit high of Rs 341.95 and low of Rs 332.20 so far during the day.
Reliance Industries fell 1.45% to Rs 841. The stock hit high of Rs 852.50 and low of Rs 836.65 so far during the day.
IT stocks gained as the rupee dropped 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.
Infosys rose 0.18%. Infosys announces its Q2 results on Friday, 11 October 2013.
Wipro rose 0.27%. The company last week announced the changes in the top deck of the organisation. The company announced the appointment of Senior Vice President Shaji Farooq as the global head of its Banking, Finance Services and Insurance (BFSI) strategic business unit. Shaji, who is currently leading the company's Advanced Technologies Service Line and Go-To-Market transformation initiatives, will take over from Senior Vice President Soumitro Ghosh, who will now head Wipro Infotech, the India and Middle East business.
TCS rose 0.85%.
HCL Technologies gained 2.51% to Rs 1,123.20. The stock hit record high of Rs 1,129 in intraday trade.
Tech Mahindra advanced 2.57% to Rs 1,434.20. The stock hit 52-week high of Rs 1,440 in intraday trade.
Shares of Just Dial dropped 7.13% to Rs 954.20. The scrip reversed direction after striking a record high of Rs 1,046.05 in intraday trade today, 7 October 2013. The stock had jumped 20% in a single trading session on Friday, 4 October 2013.
Tyre shares gained across the board. Apollo Tyres (up 3.46%), CEAT (up 4.12%), JK Tyre & Industries (up 3.61%) and MRF (up 3.28%) edged higher.
Bombay Dyeing & Manufacturing Company surged 16.03% on BSE on a media report that three global private equity firms are in talks to jointly acquire up to 24% stake in the company. WL Ross, Sequoia Capital and JC Flowers are in talks with Bombay Dyeing to invest at least Rs 500 crore, according to reports.
At its board meeting on Saturday, 5 October 2013, market regulator Securities & Exchange Board of India (Sebi) approved the draft Sebi (Foreign Portfolio Investors) Regulations, 2013. The Sebi (Foreign Portfolio Investors) Regulations, 2013 have been framed keeping in view the provisions of Sebi (Foreign Institutional Investors) Regulations, 1995, qualified foreign investors (QFIs) framework and the recommendations of the "Committee on Rationalization of Investment Routes and Monitoring of Foreign Portfolio Investments".
Sebi said that existing FIIs, sub accounts and qualified foreign investors (QFIs) shall be merged into a new investor class termed as Foreign Portfolio Investors (FPIs). Sebi approved designated depository participants (DDPs) shall register FPIs on behalf of Sebi subject to compliance with KYC requirements. The Sebi board also took note of the fact that instructions regarding risk-based KYC for FPIs have already been issued by Sebi on 12 September 2013.
Sebi said that FPIs shall be required to seek registration in any one of the categories viz. Category I Foreign Portfolio Investor -- which shall include Government and Government related foreign investors etc; Category II Foreign Portfolio Investor -0 which shall include appropriately regulated broad based funds, appropriately regulated entities, broad based funds whose investment manager is appropriately regulated, university funds, university related endowments, pension funds etc; and Category III Foreign Portfolio Investor -- which shall include all others not eligible under Category I and II foreign portfolio investors.
Sebi said that all existing FIIs and sub accounts may continue to buy, sell or otherwise deal in securities under the FPI regime. Further, all existing Qualified Foreign Investors (QFIs) may continue to buy, sell or otherwise deal in securities till the period of one year from the date of notification of this regulation. In the meantime, they may obtain FPI registration through DDPs. The registration granted to FPIs by the DDPs on behalf of Sebi shall be permanent unless suspended or cancelled by Sebi. FPIs shall be allowed to invest in all those securities, wherein Foreign Institutional Investors (FIIs) are allowed to invest.
The market regulator said Category I and Category II FPIs shall be allowed to issue, or otherwise deal in offshore derivative instruments (ODIs), directly or indirectly. However, the FPI needs to be satisfied that such ODIs are issued only to persons who are regulated by an appropriate foreign regulatory authority after ensuring compliance with know your client norms.
RBI governor Raghuram Rajan on Friday, 4 October 2013, said that there is no reason to dispute the government's estimate of 5-5.5 percent economic growth for the current fiscal year. A pick-up in exports and strong agriculture growth would help the government meet its growth estimate, said Rajan while speaking at Raipur after the Reserve Bank of India's board meeting. He also said the RBI had so far received $5.6 billion through the two swap windows the bank announced last month to attract foreign flows.
On the political front, the Election Commission on Friday, 4 October 2013, announced the schedule for assembly elections in five states. While Chhattisgarh will have a two-phase polling on 11 November and 19 November 2013, the remaining states will have a single-phase poll. Delhi and Mizoram will go to polls on 4 December 2013, Madhya Pradesh on 25 November 2013 and Rajasthan on 1 December 2013. Counting of all assembly elections in all five states will be held on 8 December 2013.
Asian markets edged lower on Monday, 7 October 2013, as lawmakers in Washington remain deadlocked over extending the nation's debt limit to avoid default. Key benchmark indices in Taiwan, Hong Kong, Indonesia, Japan and South Korea fell by 0.14% to 0.93%. Singapore's Straits Times index rose 0.02%. Mainland Chinese markets, which have been closed since Oct. 1 for the National Day holidays, resume trading tomorrow, 8 October 2013.
Trading in US index futures indicated that the Dow could fall 76 points at the opening bell on Monday, 7 October 2013. Republican House Speaker John Boehner vowed on Sunday not to raise the US debt ceiling without a "serious conversation" about what is driving the debt, while Democrats said it was irresponsible and reckless to raise the possibility of a US default. Republicans and Democrats also traded blame for a shutdown that has brought much of the government to a standstill for nearly a week. Republicans are seeking concessions in exchange for raising the nation's $16.7 trillion debt limit. If the borrowing cap is not increased, the United States could go into default.
The Federal Open Market Committee (FOMC) holds a two-day policy meeting on 29-30 October 2013. The lack of data may make it harder for the Federal Reserve to assess the economy's strength as policy makers mull the timing of reductions in bond buying. Government data from payrolls to retail sales will be delayed as long as the shutdown continues. On 18 September 2013, the Fed surprised economists and investors with its decision to delay scaling back its stimulus amid concerns about the strength of the economic recovery.
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