Key benchmark indices continued to hover in a narrow range in negative terrain in early afternoon trade. At 12:25 IST, the barometer index, the S&P BSE Sensex was down 99.30 points or 0.37% at 27,100.79. The Nifty 50 index was currently down 27 points or 0.32% at 8,310.90. Earlier, the Sensex and the Nifty, both, had hit their lowest level in more than a week in morning trade. Weakness in Asian stocks weighed on sentiment.
In overseas stock markets, Asian stocks edged lower as investors awaited US jobs data to get a clearer picture of the health of the world's biggest economy. US stocks closed mostly lower yesterday, 7 July 2016, tracking sinking oil prices, but the market pared losses late in the session as investors sought bargains ahead of the closely watched jobs report. Private-sector employment picked up a bit in June, suggesting the weak May nonfarm-payroll report may be an anomaly, Automatic Data Processing Inc. reported yesterday, 7 July 2016 and initial jobless claims fell last week to a nearly three-month low, showing no evidence of rising layoffs. The US government will announce nonfarm payroll report for June 2016 today, 8 July 2016
Closer home, the market breadth indicating the overall health of the market was weak. On BSE, 1,443 shares fell and 934 shares rose. A total of 115 shares were unchanged. The BSE Mid-Cap index was currently down 0.1%. The BSE Small-Cap index was currently down 0.3%. The decline in both these indices was lower than the Sensex's fall in percentage terms.
Metal and mining stocks declined. Bhushan Steel (down 1.65%), Jindal Steel & Power (down 2.53%), Vedanta (down 0.84%), Tata Steel (down 0.6%), NMDC (down 1.1%), Hindalco Industries (down 1.29%), Steel Authority of India (down 1.59%), Hindustan Zinc (down 0.72%) and National Aluminium Company (down 1.35%) edged lower. JSW Steel rose 0.6%. Hindustan Copper gained 0.63%.
High Grade Copper for September 2016 delivery was currently down 0.09% at $2.1215 per pound on the COMEX.
The BSE Metal index had outperformed the market over the past one month till 7 July 2016, rising 6.47% compared with 0.71% rise in the Sensex. The index had also outperformed the market in past one quarter, gaining 16.69% as against Sensex's 10.19% rise.
Stocks of companies involved in oil exploration & production activities fell as global crude oil prices dropped in the previous session. ONGC (down 1.5%) and Oil India (down 1.43%) declined. Lower crude oil prices will result in lower realization from crude sales for oil exploration firms.
In the global commodities markets, Brent crude oil futures for September settlement was up 37 cents at $46.77 a barrel. The contract had dropped $2.40 a barrel or 4.91% to settle at $46.40 a barrel during the previous trading session after data from Energy Information Administration (EIA) showed that US crude stockpiles declined less than expected in the week ended 1 July.
Shares of Cairn India dropped 3.86% as the stock turned ex-dividend today, 8 July 2016, for final dividend of Rs 3 per share for the year ended 31 March 2016.
Reliance Industries (RIL) declined 0.47%. Reliance Jio Infocomm (RJIL), a subsidiary of RIL, yesterday, 7 July 2016, issued Rs 2000 crore of 5 year non-convertible debentures (NCDs), bearing a coupon of 8.32% per annum, payable annually. The issue has been assigned a rating of AAA by CRISIL and ICRA. The proceeds of the issuance shall be utilized by RJIL for rolling out a digital services business in India. The announcement was made after market hours yesterday, 7 July 2016.
Shares of public sector oil marketing companies (PSU OMCs) also dropped. HPCL (down 0.23%), BPCL (down 0.55%) and Indian Oil Corporation (IOCL) (down 1.23%) declined.
The BSE Oil & Gas index had outperformed the market over the past one month till 7 July 2016, rising 7.71% compared with 0.71% rise in the Sensex. The index had also outperformed the market in past one quarter, gaining 10.94% as against Sensex's 10.19% rise.
Infosys rose 0.41% to Rs 1,162 after a bulk deal of 11.22 lakh shares was executed on the scrip at Rs 1,166 per share at 09:22 IST on BSE today, 8 July 2016.
Gujarat Gas rose 3.37% after the company said it received approval from the Petroleum and Natural Gas Regulatory Board (PNGRB) to operate city or local natural gas distribution network in the Panchmahal district and to expand city or local natural gas distribution network in the Anand district, both in Gujarat. The company has received 25 years or 300 months of infrastructure exclusivity, valid up to 3 July 2041, and marketing exclusivity of five years, valid up to 3 July 2021, for both the networks. The announcement was made after market hours yesterday, 7 July 2016.
Meanwhile, India Meteorological Department said in its latest update yesterday, 7 July 2016 that in the week from 30 June to 6 July 2016, rainfall was above long period average (LPA) by 35% over the country as a whole. For the country as a whole, cumulative rainfall during this year's monsoon has so far upto 6 July been 1% above LPA, thus making a further recovery of 13% from the last week ending on 29 June, it added. IMD had predicted above normal rains this monsoon season. The monsoon rains is important for the farm sector, as around 70% of the country's farmlands are rain-fed. The rains have an impact on the whole economy, as rural spending on consumer goods depends on the rainfall.
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