A bout of volatility was witnessed as the key benchmark indices trimmed losses after reversing initial gains in morning trade. The S&P BSE Sensex was down 59.77 points or 0.29%, up 88.70 points from the day's low and off 117.12 points from the day's high. The market breadth, indicating the overall health of the market, was positive.
IT stocks edged lower as the rupee edged higher against the dollar. Wipro dropped in volatile trade after announcing Q2 result after market hours on Tuesday, 22 October 2013. Metal and mining stocks rose as data last week showed a third-quarter pickup in China's economy from a slowdown earlier in the summer.
Key benchmark indices trimmed initial gains triggered by expectations that lackluster US September jobs report will lead to the Federal Reserve maintaining stimulus for the US economy in the foreseeable future. A bout of volatility was witnessed as the key benchmark indices trimmed losses after reversing initial gains in morning trade.
Foreign institutional investors (FIIs) bought shares worth a net Rs 794.90 crore on Tuesday, 22 October 2013, as per provisional data from the stock exchanges.
At 10:18 IST, the S&P BSE Sensex was down 59.77 points or 0.29% to 20,805.20. The index lost 148.47 points at the day's low of 20,716.50 in morning trade, its lowest level since 18 October 2013. The index gained 57.35 points at the day's high of 20,922.32 in early trade.
The CNX Nifty was down 22.35 points or 0.36% to 6,180.45. The index hit a low of 6,154.40 in intraday trade, its lowest level since 18 October 2013. The index hit a high of 6,217.95 in intraday trade.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,015 shares gained and 707 shares fell. A total of 108 shares were unchanged.
The total turnover on BSE amounted to Rs 565 crore by 10:25 IST compared to Rs 132 crore by 09:25 IST.
IT stocks edged lower as the rupee edged higher against the dollar. A firm rupee adversely affects operating profit margins of IT firms as the sector derives a lion's share of revenue from exports.
Wipro dropped in volatile trade after announcing Q2 result after market hours on Tuesday, 22 October 2013. The stock was off 5.2% at Rs 488.10. The scrip hit a high of Rs 514.50 and low of Rs 471.55 so far during the day. The company after market hours on Tuesday, 22 October 2013, reported 28% growth in consolidated net profit from continuing operations to Rs 1932 crore on 19% growth in revenue from continuing operations at Rs 10992 crore in Q2 September 2013 over Q2 September 2012. The results are as per International Financial Reporting Standards. Wipro said non-GAAP adjusted net profit from continuing operations jumped 29% to Rs 1932 crore in Q2 September 2013 over Q2 September 2012.
Non-GAAP constant currency IT services revenue in dollar terms grew 3.2% sequentially and 7.9% year-on-year (YoY), Wipro said. IT services revenue stood at $1.6311 billion in Q2 September 2013, a sequential increase of 2.7% and YoY increase of 5.9%. IT services revenues in rupee terms stood at Rs 10068 crore in Q2 September 2013, an increase of 20% YoY. IT services Earnings Before Interest and Tax (EBIT) was Rs 2264 crore in Q2 September 2013, an increase of 31% YoY.
Wipro expects 1.77% to 3.61% growth in revenues from IT services business at $1.66 billion to $1.69 billion in Q3 December 2013 over Q2 September 2013.
Azim Premji, Chairman of Wipro, commenting on the results said: "There are positive indicators on the global economy. Client confidence is on the uptick and we see it reflected in our results".
T K Kurien, Executive Director & Chief Executive Officer of Wipro said: "We achieved a broad based revenue growth across all industry verticals and continue to focus on executing to our strategy".
Suresh Senapaty, Executive Director & Chief Financial Officer of Wipro said: "Our sustained execution towards increasing operational efficiencies in the business coupled with currency benefits helped offset the impact of wage hikes resulting in strong improvements in operating margins".
TCS fell 1.22% to Rs 2,062. The stock had hit record high of Rs 2,258.05 in intraday trade on 15 October 2013. The company early this week said it has been selected by Bombardier Transportation, a global leader in rail transportation technology, to manage its IT infrastructure for newly commissioned data centers. The multi-year, multi-million deal is the first that TCS has signed with a rail-transportation technology provider, TCS said.
Infosys shed 1.4% at Rs 3,288.15. The scrip had hit a 52-week high of Rs 3,371.15 in intraday trade on Monday, 21 October 2013.
Metal and mining stocks rose as data last week showed a third-quarter pickup in China's economy from a slowdown earlier in the summer. JSW Steel (up 0.44%), Tata Steel (up 0.21%) NMDC (up 1.27%), Hindalco Industries (up 0.77%), National Aluminium Company (up 4.45%), Sail (up 0.4%), Hindustan Copper (up 7.39%), Jindal Steel & Power (up 0.11%), Hindustan Zinc (up 0.75%) and Sesa Sterlite (up 2.34%) edged higher.
In the foreign exchange market, the rupee edged higher against the dollar in choppy trade after soft US jobs data led to hopes that the Federal Reserve would not start tapering monetary stimulus until 2014. The partially convertible rupee was hovering at 61.50, compared with its close of 61.655/665 on Tuesday, 22 October 2013.
Asian markets on Wednesday, 23 October 2013, reversed their initial gains triggered by expectations that lackluster US September jobs report will lead to the Federal Reserve maintaining stimulus for the US economy in the foreseeable future. Key benchmark indices in Japan, Hong Kong, China, South Korea and Taiwan fell by 0.07% to 1.6%. Key benchmark indices in Indonesia and Singapore rose by 0.22% to 1.11%.
Trading in US index futures indicated that the Dow could fall 42 points at the opening bell on Wednesday, 23 October 2013. US stocks gained on Tuesday, 22 October 2013, further propelling the S&P 500's record rise, as the September nonfarm-payrolls report supported the notion that the Federal Reserve's monthly bond purchases would continue into next year.
The US created a modest 148,000 jobs in September but the number of people hired in August was higher than previously reported, indicating an economy on a zigzag course heading into the government shutdown. The nation's unemployment rate, meanwhile, fell a tick to a five-year low of 7.2%, as more people found work, according to figures released Tuesday by the Labor Department.
The Federal Open Market Committee (FOMC) holds a two-day policy meeting on 29-30 October 2013. 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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