Benchmark indices snapped three-day winning streak amid broad based selling pressure. Barring IT and realty stocks, heavy selling was witnessed across all segments with metal stocks declining the most. The Nifty opened above 11,100 mark but soon gave up that level amid selling pressure. The Nifty made lower lows in the intraday and briefly slipped below the crucial 11,000 mark.
The barometer index, the S&P BSE Sensex, fell 189.43 points or 0.5% to 37,451.84, as per the provisional closing data. The Nifty 50 index fell 59.25 points or 0.53% to 11,046.35 as per the provisional closing data.
The S&P BSE Small-Cap index was down 0.64%. The S&P BSE Mid-Cap index was down 0.92%.
The market breadth was weak. On the BSE, 953 shares rose and 1585 shares fell. A total of 146 shares were unchanged.
Reliance Industries (down 1.05%) and HDFC Bank (down 0.63%) edged lower.
Eicher Motors (up 2.07%), BPCL (up 1.86%) and Bharti Infratel (up 1.49%) advanced.
ONGC (down 3.82%), Coal India (down 3.54%) and Tata Motors (down 3.53%) declined.
Maruti Suzuki India fell 2.9%. Japanese vehicle manufacturers Toyota Motor and Suzuki Motor Company on Wednesday announced 'capital alliance' for equity investment in each other. While Toyota will purchase 4.94% shares of Suzuki Motor Co worth 96 billion Japanese yen, the latter will buy shares worth 48 billion yen in the former. Apart from manufacturing electric and hybrid models, both companies will jointly develop autonomous driving technology.
Yes Bank fell 7.47 %. Moody's Investors Service has downgraded Yes Bank's long-term foreign-currency issuer rating to Ba3 from Ba1, concluding the review for downgrade initiated on 11 June. The ratings agency also downgraded the bank's long-term foreign and local currency bank deposit ratings to Ba3 from Ba1, foreign currency senior unsecured MTN program rating to (P) Ba3 from (P) Ba1, and Baseline Credit Assessment (BCA) and adjusted BCA to b1 from ba2. The outlook on the bank's ratings, where applicable, is negative, it said.
Yes Bank said that its board will meet on Friday, 30 August 2019, to consider raising funds by issuing equity shares.
Most IT shares advanced amid weak domestic currency. NIIT Technologies (up 4.97%), HCL Technologies (up 2.33%), Infosys (up 1.78%), Tech Mahindra (up 1.43%), MphasiS (up 1.39%), Persistent Systems (up 1.04%) and TCS (up 0.28%) advanced. The S&P BSE IT was up 0.66% at 15,914.52.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 71.73, compared with its close of 71.48 during the previous trading session.
Metal stocks witnessed heavy selling. Jindal Steel & Power (down 7.74%), Steel Authority of India (down 5.03%), Hindustan Copper (down 4.19%), Tata Steel (down 3.83%), NMDC (down 3.22%), National Aluminium Company (down 2.2%), Hindalco Industries (down 1.55%) and Hindustan Zinc (down 1.05%) tumbled.
Vedanta lost 4.06%. According to the media houses, Zambia's High Court suspended the petition of ZCCH-IH to liquidate the copper mine of Vedanta resources, pending ruling by Zambia's appeals court.
Moody's Investors Service said in a new report that rising input costs and an inability to pass on higher costs to customers is pressuring the profitability of Asian steel producers and as a result revised its outlook for the sector to negative.
Oberoi Realty surged 10.25%. The company informed that the Income Tax team has left the company's premises and normal day-to-day business activities have resumed fully. The company implements the best practices of compliance with applicable laws, and it does not anticipate the search and seizure operations to have any material or adverse impact. The announcement was made after market hours yesterday, 27 August 2019.
Kalpataru Power Transmission declined 4.69% to Rs 451.75 after the company received a notice from the World Bank alleging violations in bidding process submitted by its transmission business on two projects in Africa more than 7 years ago. The company has disagreed and intends to contest the proceedings.
Godfrey Phillips India gained 3.29% after media reports suggested that Philip Morris International and Altria, which used to be one, giant tobacco company, may merge once again. Philip Morris International is in talks to merge with Altria in a deal that would reunite the makers of Marlboro brand and create the world's largest tobacco group with a market value of nearly $200 billion. Philip Morris sells tobacco products internationally and Altria does business in the United States. As on 30 June 2019, Philip Morris Global Brands Inc. held 25.1% stake in Godfrey Phillips India.
Hindustan Unilever fell 1.91% on reports the company has cut prices across some of its product portfolios to pass on the benefit of softening input costs. "HUL does selective and judicious price changes across its portfolio in the normal course of its business. Given that the commodity prices are expected to remain benign for certain time period, we have taken price reductions in range of 4-6% in Lux and Lifebuoy portfolio while it may be higher on certain packs in order to pass on the benefits to the consumers", a company spokesperson was quoted by the media as saying on Tuesday.
Overseas, European markets were trading lower while Asian stocks were mixed on Wednesday, as deeper worries about the global economy kept a lid on sentiment.
US stocks slipped on Tuesday, weighed down by financial stocks as a deepening of the Treasury yield curve inversion raised US recession worries and uncertainty over any progress in trade negotiations between the United States and China took a toll.
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