Local stocks opened on a weak note as trading resumed after a long weekened. Markets reacted negatively to gross domestic product data which grew at slowest pace since 2013. Asian stocks were mixed on Tuesday as the US-China trade tensions continue to rise. The Sensex regained the 37,000 level after briefly sliding below that level in early trade.
At 9:20 IST, the barometer index, the S&P BSE Sensex, was down 309.18 points or 0.83% at 37,023.61. The Nifty 50 index was down 97.05 points or 0.88% at 10,926.20.
The S&P BSE Mid-Cap index was down 0.91%. The S&P BSE Small-Cap index was down 0.41%.
The market breadth, indicating the overall health of the market, was weak. On the BSE, 306 shares rose and 645 shares fell. A total of 58 shares were unchanged.
India's gross domestic product (GDP) growth moderated to 25-quarters low of 5% in Q1 of 2019-20 from 5.8% growth recorded in the previous quarter and 8% improvement in the corresponding quarter last year. Quarterly Gross Value Added (GVA) growth also eased to 4.9% in Q1 of 2019-20 from 5.7% in Q4 of 2018-19 and 7.7% in Q1 of 2018-19. The data was announced after market hours on Friday, 30 August 2019.
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Growth of eight core industries dropped to 2.1% in July 2019. The eight core sector industries - coal, crude oil, natural gas, refinery products, fertiliser, steel, cement and electricity had expanded by 7.3% in July 2018.The data was announced after market hours on Friday, 30 August 2019.
Local stock markets were closed on Monday, 2 September 2019 on account of Ganesh Chaturthi.
Among stocks, Mahindra & Mahindra (M&M) fell 2.34%. M&M announced its total auto sales fell 25% to 36,085 units in August 2019 over August 2018. M&M's Farm Equipment Sector (FES) announced its total tractor sales fell 17% to 14,817 units in August 2019 over August 2018.
M&M said the company has signed a Share Subscription and Shareholder Agreement for subscribing upto 55% of the equity share capital of Meru Travel Solutions in tranches. Meru was one of the first radio taxi operators in the ride hail segment.
Maruti Suzuki India fell 1.3% after total sales fell 32.7% to 1.06 lakh units in August 2019 over August 2018.
Tata Motors dropped 3.55% as sales in the domestic & international market, stood at 32,343 vehicles in August 2019 compared to 62,688 units during August 2018.
L&T shed 0.95%. L&T said that the Transportation Infrastructure and Buildings & Factories businesses of L&T Construction have secured a project from the Navi Mumbai International Airport Private (NMIAPL) for the Engineering, Procurement and Construction of the greenfield Navi Mumbai International Airport at Navi Mumbai.
Yes Bank declined 1.68%. Yes Bank announced after market hours on Friday, 30 August 2019, that it will raise the authorised share capital by increasing the equity shares to 450 crore equity shares of Rs 2 each, aggregating to Rs 900 crore from the current 300 crore equity shares of Rs 2 each that aggregates to Rs 600 crore. The preference shares would be kept constant at two crore shares of Rs 100 each aggregating to Rs 200 crore. The proposal is subject to requisite approvals.
Dewan Housing Finance Corporation (DHFL) fell 1.26%. dhfl said its board approved the plan to convert the whole or part of its debt into shares. The board also approved raising the authorised share capital from Rs 828 crore to Rs 1090.39 crore. Among other decisions, the DHFL board also approved availing additional credit facilities based on the existing borrowing limits and disposal of whole or part of the undertakings or assets of the company. The announcement was made after market hours on 30 August 2019.
The government unveiled mega merger of state-run banks. In a press briefing after market hours on Friday, 30 August 2019, finance minister announced that Punjab National Bank (PNB), Oriental Bank of Commerce (OBC) and United Bank of India will be merged. The combined entity will be second largest PSU bank in India with business of Rs 17.94 lakh crore. It will have second largest banking network in India with 11,437 branches.
Union Bank of India, Andhra Bank and Corporation Bank will be also merged. The entity will be fifth largest public sector bank with business of Rs 14.59 lakh crore. Canara bank and Syndicate Bank will be merged. The entity will be fourth largest public sector bank with business of Rs 15.20 lakh crore. Finance minister also announced that Indian Bank and Allahabad Bank will be merged. The entity will be seventh largest public sector bank with business of Rs 8.08 lakh crore.
In place of fragmented lending capacity with 27 public sector banks in 2017, now there will be 12 public sector banks post the latest round of consolidation of PSU banks. The consolidation of public sector banks will give them scale, FM said.
Overseas, Asian stocks were mixed on Tuesday as the US-China trade tensions continue to rise after China lodged a complaint against the United States at the World Trade Organization over US import duties.
US stock exchanges were closed on Monday for Labor Day holiday. US stocks ended with a lackluster session on Friday as investors were cautious ahead of a holiday weekend in which a fresh round of US tariffs on Chinese imports were due to be levied. US President Donald Trump said the sides would still meet for talks later this month. Trump said his goal was to reduce US reliance on China and he again urged American companies to find alternate suppliers outside China.
The United States began imposing 15% tariffs on a variety of Chinese goods on Sunday - including footwear, smart watches and flat-panel televisions - as China began imposing new duties on US crude, the latest escalation in a bruising trade war.
In Europe, British Prime Minister Boris Johnson indicated he could call an election to stymie lawmakers' efforts to avert a no-deal Brexit.
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