Volatility continued as key benchmark indices trimmed losses after hitting fresh intraday low in morning trade. The S&P BSE Sensex was down 23.40 points or 0.12%, up close to 60 points from the day's low and off about 85 points from the day's high. The market breadth, indicating the overall health of the market, was negative.
Capital goods pivotals declined. Realty shares fell for the second day in a row. Dr Reddy's Laboratories extended intraday gain. Index heavyweight and cigarette maker ITC edged higher after its hospitality arm ITC Hotels on Monday, 16 September 2013, said it has tied up with RP Group Hotels & Resorts to manage 5 hotels in India and Dubai, under ITC Hotels' 5-star 'WelcomHotel' brand and the group's mid-market to upscale 'Fortune' brand.
The market edged lower after oscillating between positive and negative zone in early trade. Volatility continued as key benchmark indices trimmed losses after hitting fresh intraday low in morning trade..
In the foreign exchange market, the rupee weakened against the dollar ahead of the Federal Reserve's meeting, where it is widely expected to announce tapering of bond purchases. The partially convertible rupee was hovering at 63.52, weaker than its close of 62.83.84 on Monday, 16 September 2013.
The domestic currency has declined against the dollar this year due to fears that India will struggle to fund its current account gap if the US starts to wind down its easy-money policies that have fueled global liquidity in recent years. The rupee has, however, made a strong rebound after hitting record low of 68.85 in intraday deals on 28 August 2013. The recovery in the rupee materialized after new Reserve Bank of India Governor Raghuram Rajan on 4 September 2013 announced plans to bolster the financial industry and stabilize the rupee.
Rupee depreciation fuels inflation, increases import bill and current account deficit. It also increases the government's spending on fuel subsidies, potentially widening the fiscal deficit.
At 10:20 IST, the S&P BSE Sensex was down 23.40 points or 0.12% to 19,719.07. The index declined 107.03 points at the day's low of 19,635.44 in morning trade. The index rose 36.79 points at the day's high of 19,779.26 in early trade.
The CNX Nifty was down 9.20 points or 0.16% to 5,831.35. The index hit a low of 5,804.90 in intraday trade. The index hit a high of 5,846.40 in intraday trade.
The market breadth, indicating the overall health of the market, was negative. On BSE, 876 shares fell and 631 shares rose. A total of 79 shares were unchanged.
Among the 30-share Sensex pack, 17 stocks declined and rest of them rose. Wipro (up 3.34%), TCS (up 1.75%) and Maruti Suzuki India (up 1.44%), gained.
Index heavyweight and cigarette maker ITC rose 0.19%. ITC Hotels on Monday, 16 September 2013, said it has tied up with RP Group Hotels & Resorts to manage 5 hotels in India and Dubai, under ITC Hotels' 5-star 'WelcomHotel' brand and the group's mid-market to upscale 'Fortune' brand. The tie-up has been firmed up through a Memorandum of Understanding between ITC Hotels and RP Groups Hotels & Resorts. While the two WelcomHotels are already under a management contract and will be flagged off immediately, the three Fortune hotels are a part of the signed MOU and will be launched subsequently, ITC Hotels said in a statement. As part of its expansion drive, ITC Hotels proposes to add several managed hotels to its brand portfolio, it said. On the anvil are an ITC super-premium luxury hotel in Mahabalipuram, a WelcomHotel in Jodhpur, Patna and Chandigarh and more than 30 hotels under the Fortune brand.
Capital goods pivotals declined. L&T (down 0.56%) and Bhel (down 1.84%), dropped.
Realty shares fell for the second day in a row. HDIL (down 4.01%), Unitech (down 1.72%), Sobha Developers (down 2.05%) and DLF (down 2.11%), edged lower.
Dr Reddy's Laboratories gained 2.62%, with the stock extending intraday gain.
Reliance Broadcast Network hit upper circuit of 5% at Rs 47.55 on BSE after the company said its board will consider delisting proposal on 18 September 2013. The company made the announcement after market hours on Monday, 16 September 2013.
Man Industries (India) rose 2.3% to Rs 71.20. Two block deals were executed on the counter on BSE today, 17 September 2013. One block deal of 2.5 lakh shares was executed at Rs 74 at 9:44 IST and another block deal of 2.5 lakh shares was struck at Rs 73.90 also at 9:44 IST. The company announced on Sunday, 15 September 2013, the demerger of its real estate and infrastructure business which is conducted through Man Infraprojects. Shareholders of Man Industries will be entitled to one fully paid-up equity share of Rs 5 each of Man Infraprojects for each share held in Man Industries (India). Man Infraprojects will be listed separately on the bourses in due course.
Man Industries (India) said that it is confident that the demerger will enhance value for its shareholders, and provide fresh momentum for growth in both the business verticals. The proposed demerger will allow the group to improve performance significantly by capitalizing the opportunities, the company said in a statement.
At its upcoming mid-quarter monetary policy review on Friday, 20 September 2013, the Reserve Bank of India will have to decide whether to give in to industry demands and lower interest rates in order to boost slowing economic growth, or leave interest rates unchanged for the third straight policy review as it guards against risks of a fresh rise in inflationary pressures.
Asian stocks fell on Tuesday, 17 September 2013, as the Federal Reserve begins a two-day policy meeting at which it is forecast to reduce the pace of its US bond buying. Key benchmark indices in China, Japan, Taiwan, Hong Kong, Indonesia and South Korea fell by 0.26% to 0.9%. Singapore's Straits Times rose 0.14%.
Trading in US index futures indicated that the Dow could fall 9 points at the opening bell on Tuesday, 17 September 2013. Most US stocks rose on Monday, 16 September 2013, after former US Treasury secretary Larry Summers removed himself from consideration to run the Federal Reserve. Summers was seen as relatively hawkish.
Investors across the globe are eyeing the two-day policy meeting of the Federal Open Market Committee (FOMC), considered by many to provide an indication on the timing and size of the Fed's cutbacks in its bond-purchase program. The FOMC's two-day policy meeting on interest rates in the United States begins today, 17 September 2013. The US central bank currently buys $85 billion a month in US debt and mortgage-backed securities in a bid to hold interest rates low and encourage economic growth. Federal Reserve Chairman Ben Bernanke has on several occasions stressed that the tapering process is dependent on an improvement in data. Fed's bond-buying program has kept global markets flush with liquidity in recent years. Investors are also eyeing Fed's forward guidance on policy.
UN chemical investigators on Monday confirmed the use of sarin nerve agent in an August 21 poison gas attack outside the Syrian capital in a long-awaited report that the United States, Britain and France said proved government forces were responsible. Syria and Russia have blamed the August 21 attack on the rebels. The rebels, the United States and other Western powers blame forces loyal to Assad for the Ghouta attack. The UN confirmation of sarin gas use on August 21 comes as France, Britain and the United States agreed in Paris to seek a strong and robust UN resolution that sets binding deadlines on removal of chemical weapons. Those talks followed a weekend deal on Syria's chemical weapons reached by the United States and Russia that could avert US military action.
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