Bank stocks and index heavyweights ITC, HDFC, L&T and HDFC Bank led a strong intraday rebound for key benchmark indices in afternoon trade. The market breadth indicating the overall health of the market turned positive from negative. The barometer index, the S&P BSE Sensex, was currently trading below the psychological 28,000 mark, having alternately moved above and below that level in afternoon trade. Earlier, the Sensex continued to trade below psychological 28,000 mark after falling below that level at the onset of the trading session as key equity benchmark indices in India opened with a downward gap after people of Greece yesterday, 5 July 2015, voted against accepting further austerity in exchange for a new European bailout, increasing the chances of the country having to abandon the euro. The Sensex was currently off 98.50 points or 0.35% at 27,994.29. The BSE Small-Cap and Mid-Cap indices were both in green.
Power generation stocks declined. FMCG shares were mixed.
Meanwhile, the monsoon has entered a weak phase if the data released by the India Meteorological Department (IMD) is any indication. July is the crucial month for the sowing of Kharif crops.
Earlier, the Sensex hit its lowest level in almost a week amid initial volatility.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 356.29 crore during the previous trading session on Friday, 3 July 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) sold shares worth a net Rs 220.61 crore on Friday, 3 July 2015, as per provisional data released by the stock exchanges.
In overseas markets, European stocks edged lower after Greek voters overwhelmingly rejected reform measures put forward by the country's international creditors in a referendum held yesterday, 5 July 2015, a result seen as increasing the chances Greece will exit the shared currency. Asian stocks edged lower as people of Greece voted against accepting further austerity in a referendum held yesterday, 5 July 2015, increasing the risk of the country's exit from the euro zone.
At 13:16 IST, the S&P BSE Sensex was down 98.50 points or 0.35% at 27,994.29. The index lost 317.99 points at the day's low of 27,774.80 in early trade, its lowest level since 30 June 2015. The index fell 71.57 points at the day's high of 28,021.22 in afternoon trade.
The CNX Nifty was down 25.70 points or 0.30% at 8,459.20. The index hit a low of 8,386.15 in intraday trade, its lowest level since 1 July 2015. The index hit a high of 8,469.50 in intraday trade.
The market breadth indicating the overall health of the market turned positive from negative in afternoon trade. On BSE, 1,467 shares rose and 1,144 shares fell. A total of 116 shares were unchanged.
The BSE Mid-Cap index was up 37.29 points or 0.34% at 10,907.29. The BSE Small-Cap index was up 62.15 points or 0.55% to 11,365.73. Both theses indices outperformed the Sensex.
Power generation stocks declined. Tata Power (down 1.48%), JSW Energy (down 1.41%), Reliance Infrastructure (down 1.39%), Jaiprakash Power Ventures (down 1.23%), GMR Infrastructure (down 0.98%), NTPC (down 0.94%), Reliance Power (down 0.89%) and Adani Power (down 0.52%), edged lower. Torrent Power (up 0.42%) and CESC (up 0.93%), edged higher.
FMCG shares were mixed. Jyothy Laboratories (up 5.19%), Bajaj Corp (up 3.06%), Marico (up 1.03%), Britannia Industries (up 0.84%), GlaxoSmithKline Consumer Healthcare (up 0.56%) and Dabur India (up 0.12%) edged higher. Procter & Gamble Hygiene & Health Care (down 0.29%), Hindustan Unilever (down 0.38%), Colgate Palmolive (India) (down 0.53%), Nestle India (down 0.9%), Godrej Consumer Products (down 1.07%) and Tata Global Beverages (down 1.88%) edged lower.
Meanwhile, the monsoon has entered a weak phase if the data released by the India Meteorological Department (IMD) is any indication. For the country as a whole, cumulative rainfall during this year's monsoon season was near normal until 5 July 2015. This is a far cry when compared to a reading 24% above the Long Period Average (LPA) until 24 June 2015. Region wise, the southwest monsoon was 5% above the Long Period Average (LPA) in Northwest India, 2% above the LPA in Central India, 2% above the LPA in South Peninsula and 4% below the LPA in East & Northeast India until 5 July 2015.
The IMD said in its daily monsoon update issued yesterday, 5 July 2015, that the Southwest Monsoon was active over Arunachal Pradesh and Sub-Himalayan West Bengal & Sikkim and Normal over Assam & Meghalaya, Gangetic West Bengal, Jharkhand, Bihar and Coastal Karnataka during past 24 hours until 8:30 IST.
The June-September southwest monsoon is critical for the country's agriculture because a considerable part of the country's farmland is dependent on the rains for irrigation.
Meanwhile, the weekly data released by the Ministry of Agriculture after trading hours on Friday, 3 July 2015, showed that the sowing of Kharif crops is gathering pace. The total sown area for Kharif crops as on 3 July 2015 stood at 306.06 lakh hectares compared with 194.25 lakh hectares at this time last year. July is the crucial month for the sowing of Kharif crops.
In overseas markets, European stocks edged lower in early trade today, 6 July 2015, after Greek voters overwhelmingly rejected reform measures put forward by the country's international creditors in a referendum held yesterday, 5 July 2015, a result seen as increasing the chances Greece will exit the shared currency. Key indices in Germany, UK and France were off 0.72% to 1.41%. In Spain, the IBEX 35 index was currently off 1.62%. In Italy, the FTSE MIB index was currently off 2.53%.
In Sunday's referendum, more than 61% of Greeks voted "'no" to austerity measures and other overhauls that European and International Monetary Fund officials had wanted in recent talks on further bailout aid. Greece has now entered unknown economic and financial territory, with no clear path to continued European aid. Eurozone leaders will reportedly holding an emergency meeting in Brussels tomorrow, 7 July 2015, to work out their response to the Greek vote and the next steps in any negotiations, which have been stalled since the referendum was announced. Meanwhile, Yanis Varoufakis resigned as Greece's finance minister today, 6 July 2015, a day after Greeks voted resoundingly to reject the austerity terms of a bailout.
Meanwhile, the European Central Bank's (ECB) policymaking governing council will reportedly hold a conference call today, 6 July 2015, to decide how long to go on keeping Greek banks afloat after the overwhelming rejection of bailout terms the central bank had helped to shape. The ECB's policymaking governing council was meeting to decide whether maintain, increase or reduce a lifeline for Greek banks, which have been shuttered for a week with cash withdrawals rationed and money fast running out.
Greece had been locked in negotiations with its creditors for months when the Greek government unexpectedly called a referendum on the terms it was being offered. Banks have been shut and capital controls in place since last Monday, after the ECB declined to give Greece more emergency funding. Withdrawals at cash machines have been limited to euro 60 per day.
On 20 July 2015, Greece has debt repayment of euro 3.5 billion ($3.9 billion) due to the ECB.
Asian stocks edged lower today, 6 July 2015, as Greece voted against accepting further austerity, increasing the risk of the country's exit from the euro zone. Key benchmark indices in Singapore, Taiwan, Hong Kong, Japan, Indonesia and South Korea were off 0.79% to 3.29%.
Stocks in mainland China witnessed immense volatility. The Shanghai Composite index rose 2.41% to settle at 3,775.91. China unleashed an unprecedented series of support measures over the weekend to stave off the prospect of a full-blown crash that was threatening to destabilise the world's second-biggest economy. The Shanghai Composite index had slumped more than 12% last week. In an extraordinary weekend of policy moves, brokerages and fund managers vowed to buy massive amounts of stocks, helped by China's state-backed margin finance company, which in turn would be aided by a direct line of liquidity from the central bank. In a series of initial announcements on Saturday, 4 July 2015, China's top brokerages pledged to collectively buy at least 120 billion yuan ($19.3 billion) of shares to help steady the market, and said they would not sell while the Shanghai Composite Index remained below 4,500, a level last seen on 25 June 2015.
Separately, a total of 94 mutual fund companies pledged to buy shares. Meanwhile, 28 companies that had been approved to launch IPOs announced they had suspended their plans.
Trading in US index futures indicated that the Dow could slide 130 points at the opening bell today, 6 July 2015.
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