Volatility continued as key benchmark indices reversed initial gains in morning trade. The barometer index, the S&P BSE Sensex, regained 26,000 mark after falling below that level for a brief period in morning trade. The Sensex was down 70.08 points or 0.27%, off close to 160 points from the day's high and up about 50 points from the day's low. The market breadth indicating the overall health of the market was weak.
Shares of companies whose fortunes are linked to orders from Indian Railways edged lower ahead of the presentation of Railway Budget today, 8 July 2014.
At 10:20 IST, the S&P BSE Sensex was down 70.08 points or 0.27% to 26,030. The index dropped 117.11 points at the day's low of 25,982.97 in morning trade, its lowest level since 4 July 2014. The index rose 90.36 points at the day's high of 26,190.44 in early trade, a lifetime high of the index.
The CNX Nifty was down 26.75 points or 0.34% to 7,760.40. The index hit a low of 7,744.95 in intraday trade, its lowest level since 4 July 2014. The index hit a high of 7,808.85 in intraday trade, a lifetime high of the index.
The market breadth indicating the overall health of the market was weak. On BSE, 1,259 shares declined and 782 shares rose. A total of 66 shares were unchanged.
The BSE Mid-Cap index was down 43.04 points or 0.4% at 9,514.10. The BSE Small-Cap index was down 81.02 points or 0.77% at 10,489.76. Both these indices underperformed the Sensex.
Sesa Sterlite (down 2.21%), Coal India (down 1.36%) and Maruti Suzuki India (down 1.07%) edged lower from the Sensex pack.
Shares of companies whose fortunes are linked to orders from Indian Railways edged lower ahead of the presentation of Railway Budget today, 8 July 2014. Kernex Microsystems (India) (down 4.94% to Rs 70.25), Texmaco Rail and Engineering (down 1.71% to Rs 216), Titagarh Wagons (down 3.19% to Rs 320), Zicom Electronic Security Systems (down 0.69% to Rs 115.10), Stone India (down 3.55% to Rs 46.75), and BEML (down 2.64% to Rs 794) declined. Container Corporation of India (up 1.78% to Rs 1,372), Kalindee Rail Nirman (Engineers) (up 1.07% to Rs 136.80) and Hind Rectifiers (up 0.59% to Rs 60.10) gained.
Railway Minister Sadanand Gowda is reportedly likely to announce a slew of measures to garner funds such as tapping foreign investments, encouraging private players and outlining public-private partnership models to revamp rail infrastructure. Gowda may announce plans to accelerate the project relating to running bullet trains (300 kmph) on Mumbai-Ahmedabad corridors and increasing the speed of elite Rajdhani and Shatabdi trains to 160-200 kmph. The minister is expected to desist from populism and focus on streamlining the system and announce measures to enhance safety and passenger amenities.
A bout of volatility was witnessed as key benchmark indices trimmed gains after opening on a firm note. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both scaled record high. Volatility continued as key benchmark indices reversed initial gains in morning trade. The Sensex regained 26,000 mark after falling below that level for a brief period in morning trade.
The current week is a crucial period for Indian financial markets. Railway Minister Sadananda Gowda will present the final Railway Budget for 2014-15 in Lok Sabha today, 8 July 2014. The Finance Ministry will table Economic Survey for 2013-14 tomorrow, 9 July 2014. Finance Minister Arun Jaitley will present the final Union Budget for 2014-15 in Lok Sabha at 11:00 IST on Thursday, 10 July 2014. After a clear mandate in Lok Sabha elections this year and with BJP perceived as a business friendly party, expectations from the Budget are running high.
There are expectations that the finance minster will announce measures in the Budget aimed at bolstering economic growth. Increase in outlay on infrastructure sector with focus on stricter and time-bound implementation of projects, initiatives towards investments in agriculture and irrigation aimed at easing supply bottlenecks for food-grains, fiscal prudence with roadmap to reduce the fiscal deficit, a roadmap for reducing the subsidy burden and timeline for implementation of the Goods and Services Tax are some of the expectations from the Budget.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 59.88, compared with its close of 60.0125/0225 on Monday, 7 July 2014.
Asian stocks dropped on Tuesday, 8 July 2014, as earnings guidance from regional tech heavyweight Samsung came in well short of forecasts. Key benchmark indices in China, Singapore, South Korea, Hong Kong, and Japan were off 0.07% to 0.23%. Key benchmark indices in Taiwan and Indonesia rose 0.17% to 0.94%.
Trading in US index futures indicated that the Dow could fall 10 points at the opening bell on Tuesday, 8 July 2014. US stocks fell Monday, 7 July 2014, on profit booking after Dow Jones Industrial Avergae and the S&P 500 index hit record high last week.
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