A bout of volatility was witnessed in mid-afternoon trade as key benchmark indices weakened once again after trimming intraday losses triggered by firm European stocks. At 14:20 IST, the barometer index, the S&P BSE Sensex, was down 113.58 points or 0.38% at 29,674.77. The Nifty 50 index was down 34.85 points or 0.38% at 9,208.50. The market sentiment was subdued amid tensions in North Korea and Syria.
The market trimmed losses after hovering in red till afternoon trade. It had extended initial losses after trading near the flat line in early trade after a positive opening.
The BSE Mid-Cap index declined 0.28%. The BSE Small-Cap index lost 0.36%. The decline in both the indices was lower than the Sensex's fall in percentage terms.
The breadth, indicating the health of the market, was weak. On BSE, 1,752 shares fell and 1,022 shares rose. A total of 129 shares were unchanged.
Metal and mining stocks declined. Bhushan Steel (down 2.6%), Jindal Steel & Power (down 0.6%), Tata Steel (down 1.35%), NMDC (down 0.89%), Hindalco Industries (down 1.15%), Steel Authority of India (down 1.29%), JSW Steel (down 0.6%), Hindustan Zinc (down 0.49%) and National Aluminium Company (down 1.4%) edged lower.
Vedanta gained 2.93% and Cairn India rose 2.29% after Vedanta and Cairn India announced after market hours yesterday, 11 April 2017, that the merger of Cairn India with Vedanta pursuant to the scheme of arrangement has become effective. Thursday, 27 April 2017 has been fixed as the record date for determining the list of the shareholders of Cairn India to whom the equity and preference shares of Vedanta will be allotted as per terms of the scheme.
Shareholders of Cairn India will receive, for each equity share held, one equity share in Vedanta of face value Rs 1 each and four 7.5% redeemable preference share (RPS) in Vedanta with a face value of Rs 10 each.
Cairn India shareholders as on said record date, who will become shareholders of Vedanta, would also receive an interim dividend of Rs 17.70 per equity share as approved by the board of Vedanta on 30 March 2017.
No shares will be issued to Vedanta or any of its subsidiaries for their shareholding in Cairn India. Vedanta will arrange for a third-party facility enabling a cash exit for RPS holders at par within 30 days from issuance.
This merger consolidates Vedanta's position as one of the world's largest diversified natural resources companies, with world-class, low-cost assets in metals & mining and oil & gas. The merged company will have a larger pro forma market capitalisation of $15.60 billion, and higher free float of 49.9%.
Sugar stocks rallied. Balrampur Chini Mills (up 1.06%),, Shree Renuka Sugars (up 1.56%), Sakthi Sugars (up 4.8%), Rana Sugars (up 3.62%), Triveni Engineering & Industries (up 3.97%) and Dwarikesh Sugar Industries (up 5.79%) surged.
Sukhjit Starch & Chemicals gained 5.2% after the company announced that most of the approvals from the concerned authorities including no objection certificate (NOC) from Central Ground Water Authority for setting up the mega food park in Tehsil Phagwara, Distt. Kapurthala, Punjab have been received. However, some statutory approvals from the State Government Authorities like obtaining consent to establish, approval of layout/zoning plans etc are in process, Sukhjit Starch & Chemicals said.
The mega food park will be set up in the name and style of Sukhjit Mega Food Park & Infra, a special purpose vehicle incorporated as a wholly owned subsidiary of the company. The mega food park will entail an investment of Rs 125 crore, which will be financed by way of Central Government subsidy of Rs 50 crore, bank term loan of Rs 40 crore and balance by way of equity contribution. The announcement was made after market hours yesterday, 11 April 2017.
Sterling Tools surged 9.61% after the company said that it has signed a business collaboration agreement with a Japan-based Meidoh Co. The company has signed share subscription agreement with Meidoh Co and has accordingly approved the proposal to issue 18.01 lakh shares on preferential basis to it at Rs 246.60 per share. The announcement was made during market hours today, 12 April 2017.
Overseas, European stocks gained after the German economy, Europe's largest, picked up speed at the beginning of this year, lifted by a robust industrial sector and rising employment that is supporting private consumption, the Economy Ministry said. In the final three months of 2016, the economy grew by 0.4%.
Most Asian stocks dropped as a drumbeat of alarming geopolitical news compelled investors to move money out of risky assets.
North Korea warned yesterday, 11 April 2017, of a nuclear attack on the United States at any sign of aggression, as a US Navy strike group steamed toward the western Pacific - a force President Donald Trump described as an "armada".
At the same time, US Secretary of State Rex Tillerson was in Moscow to denounce Russian support for Syria's Bashar al-Assad, raising the stakes in the Middle East. Political uncertainty in France also weighed on sentiment as hard-left candidate Jean-Luc Melenchon surged in the polls ahead of the May Presidential election.
On data front in Asia, China's consumer inflation rebounded slightly in March after slipping to a more than two-year low in the previous month, official data showed. China's consumer price index increased 0.9% in March from a year earlier, compared with a 0.8% gain in February, the National Bureau of Statistics said.
China's producer price inflation cooled for the first time in seven months in March. China's producer price index (PPI) rose 7.6% in March from a year earlier, still elevated but in line with expectations and easing from 7.8% in February.
Japanese core machinery orders rose in February, the government said, a sign that companies are investing more for growth despite continuing global political and economic uncertainty. Core machinery orders, a leading indicator of business investment, increased 1.5% from the previous month, following a drop of 3.2% in January, the Cabinet Office said.
US stocks finished slightly lower yesterday, 11 April 2017, as rising geopolitical tensions lured investors out of risky assets like stocks and into the perceived safety of treasuries, gold and the Japanese yen.
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