Stocks staged a pullback in mid-afternoon trade after hitting fresh intraday low in afternoon trade. At 14:15 IST, the barometer index, the S&P BSE Sensex, was down 139.97 points or 0.39% at 35,599.19. The Nifty 50 index was down 50.60 points or 0.47% at 10,806.10. Capital goods stocks declined. Most metal and mining stocks fell. Sentiment was weak due to negative global cues triggered by the US Federal Reserve raising interest rates and striking a hawkish tone in its latest policy statement.
Domestic stocks edged lower in early trade tracking negative Asian stocks after the US Federal Reserve struck a hawkish tone in its latest policy statement. Fresh selling in index pivotals pulled the key benchmark indices to intraday low in morning trade. Stocks continued to trade with weakness in mid-morning trade. Indices trimmed losses after hitting fresh intraday low in afternoon trade.
The S&P BSE Mid-Cap index was down 0.27%. The S&P BSE Small-Cap index was down 0.02%. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was negative. On the BSE, 1066 shares rose and 1444 shares fell. A total of 117 shares were unchanged.
Capital goods stocks declined. Bharat Heavy Electricals (Bhel) (down 2.88%), ABB India (down 0.45%), GE T&D India (down 1.42%), Bharat Electronics (down 3.02%), Punj Lloyd (down 11.38%) and Siemens (down 0.9%) fell. BEML (up 0.47%) and Thermax (up 1%) rose.
Most metal and mining stocks fell. JSW Steel (down 1.08%), Tata Steel (down 0.03%), Vedanta (down 0.7%), Steel Authority of India (Sail) (down 1.31%), Jindal Steel & Power (down 0.94%), Hindalco Industries (down 0.43%), NMDC (down 0.6%) edged lower. National Aluminium Company (up 1.77%), Hindustan Zinc (up 0.36%) and Hindustan Copper (up 2.67%) rose.
HCL Technologies rose 1.33%. HCL Technologies announced it has signed an end-to-end IT infrastructure services deal with Falck, an international leader in the ambulance and healthcare markets. The announcement was made during trading hours today, 14 June 2018.
Through this deal, HCL will support Falck's business transformation by consolidating, simplyfing and standardizing Falck's IT infrastructure operations through a centralised global service delivery model. The new centralised model will enable greater automation, improved cost transparency, enhanced operational efficiency and increased control. The delivery hubs for this engagement will include HCL's newly inaugurated Global Delivery Centre in Gothenburg, Sweden and sites in the US and South America.
On the macro front, the annual rate of inflation, based on monthly Wholesale Price Index (WPI), stood at 4.43% (provisional) for May 2018 (over May 2017) as compared to 3.18% (provisional) for the previous month and 2.26% during the corresponding month of the previous year. The data was unveiled during trading hours today, 14 June 2018.
India's current account deficit (CAD) widened in the fourth quarter of 2017-18 compared to a year ago, government data released after market hours yesterday, 13 June 2018 showed. India's CAD at US$ 13 billion (1.9% of GDP) in Q4 of 2017-18 increased from US$ 2.6 billion (0.4% of GDP) in Q4 of 2016 -17, but moderated marginally from US$ 13.7 billion (2.1% of GDP) in the preceding quarter. The widening of the CAD on a year-on-year (y-o-y) basis was primarily on account of a higher trade deficit (US$ 41.6 billion) brought about by a larger increase in merchandise imports relative to exports.
For the full year, the CAD increased to 1.9% of GDP in 2017-18 from 0.6% in 2016-17 on the back of a widening of the trade deficit. India's trade deficit increased to US$ 160 billion in 2017-18 from US$ 112.4 billion in 2016-17.
Traders and investors are closely awaiting a series of domestic and global events this week. On the global front, the European Central Bank (ECB) will hold its policy meeting today, 14 June 2018, in which policy makers are poised to hold formal talks on ending its bond-buying program. The Bank of Japan meets tomorrow, 15 June 2018 with no change to policy expected.
Overseas, European stocks dropped on Thursday as traders watched developments from central banks across the world.
Asian stocks followed US equities lower as the Federal Reserve struck a hawkish tone in its latest policy statement. US stock benchmarks ended near session lows yesterday, 13 June 2018, as the Federal Reserve completed its second increase to benchmark interest rates in 2018, as expected, but signaled a slightly more aggressive plan to tighten monetary policy this year than had previously been projected.
The Federal Reserve voted to raise its benchmark federal-funds rate by a quarter percentage point to a range of 1.75% to 2%. Policymakers also projected a slightly faster pace of rate increases in the coming months, with two additional hikes expected by the end of this year, compared to one previously. They see another three rate increases next year, a pace unchanged from their previous forecast.
Chairman Jerome Powell said the Fed was comfortable with a return of once-dormant inflation and emphasized the central bank's desire to avoid a policy error that could result in unnaturally inflating asset valuations or pushing the economy into a recession.
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