Key benchmark indices extended losses in mid-morning trade as the collapse of Greek rescue talks roiled global markets. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty were currently trading with losses of more than 2% each. The Sensex hit its lowest levels in more than a week. For the Nifty, the low of 8,195.65 hit in intraday trade so far during the trading session matched the index's lowest level hit on 19 June 2015. The market breadth indicating the overall health of the market was extremely weak. There were more than four losers against every gainer on BSE. The Sensex was currently off 568.44 points or 2.04% at 27,243.40. The BSE Mid-Cap index was off 2.44%. The BSE Small-Cap index was off 2.43%. The decline in both these indices was higher than the Sensex's decline in percentage terms.
Indian stocks tumbled today, 29 June 2015, as Asian stocks slumped and trading in US index futures indicated a weak opening of US stocks later in the global day as the Greek financial crisis worsened, with odds of a default increasing after the country announced plans for a referendum on its bailout conditions. Greece shut down its banking system, ordering lenders to stay closed for six days starting today, 29 June 2015, and its central bank moved to impose controls to prevent money from flooding out of the country. The steps, a fateful climax to five years of debt crisis, puts Greece closer than it ever has been to an exit from the euro. The decision came after the European Central Bank yesterday, 28 June 2015, decided not to expand a lifeline of emergency funds that has been sustaining Greek banks.
Closer home, shares of pharmaceutical companies edged lower. Banks shares also edged lower.
Foreign portfolio investors sold shares worth a net Rs 203.74 crore during the previous trading session on Friday, 26 June 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 234.21 crore on Friday, 26 June 2015, as per provisional data released by the stock exchanges.
At 11:25 IST, the S&P BSE Sensex was down 568.44 points or 2.04% at 27,243.40. The index fell 602.65 points at the day's low of 27,209.19 in mid-morning trade, its lowest level since 19 June 2015. The index fell 360.77 points at the day's high of 27,451.07 in opening trade.
The 50-unit CNX Nifty was down 171.45 points or 2.05% at 8,209.65. The index hit a low of 8,195.65 in intraday trade so far, which is exactly the same as intraday low of the Nifty on 19 June 2015. The index hit a high of 8,248.05 in intraday trade.
The BSE Mid-Cap index was down 261.09 points or 2.44% at 10,425.02. The BSE Small-Cap index was down 270.44 points or 2.43% at 10,854.05. The decline in both these indices was higher than the Sensex's decline in percentage terms.
The market breadth indicating the overall health of the market was extremely weak. There were more than four losers against every gainer on BSE. 1,789 shares fell and 405 shares rose. A total of 85 shares were unchanged.
Bank stocks edged lower. Among PSU banks, Union Bank of India (down 5.06%), UCO Bank (down 4.25%), Allahabad Bank (down 3.77%), Andhra Bank (down 3.43%), Bank of India (down 3.39%), IDBI Bank (down 3.38%), Indian Bank (down 3.37%), Punjab and Sind Bank (down 3.21%), Corporation Bank (down 3.15%), State Bank of India (down 3.11%), United Bank of India (down 2.7%), Canara Bank (down 2.69%), Dena Bank (down 2.56%), Syndicate Bank (down 2.4%), Punjab National Bank (down 2.35%), Bank of Maharashtra (down 2.34%), Bank of Baroda (down 2.28%), Central Bank of India (down 2.1%) and Vijaya Bank (down 1.97%), edged lower.
Among private sector banks, ICICI Bank (down 2.84%), HDFC Bank (down 2.67%), IndusInd Bank (down 2.38%), Yes Bank (down 2.25%), Kotak Mahindra Bank (down 2.11%), Federal Bank (down 1.83%) and City Union Bank (down 1.23%), edged lower.
Axis Bank was down 2.4%. The private sector bank on Friday, 26 June 2015, announced a reduction in its base rate by 10 basis points to 9.85% per annum from 9.95% with effect from 30 June 2015. Accordingly, the effective rate applicable to various fund based credit and credit limits which are linked to the bank's base rate will reduce by 10 basis points, Axis Bank said in a press release.
Shares of pharmaceutical companies edged lower. IPCA Laboratories (down 4.52%), Wockhardt (down 4.27%), Aurobindo Pharma (down 3.8%), Sun Pharmaceutical Industries (down 2.57%), Dr. Reddy's Laboratories (down 2.55%), Strides Arcolab (down 2.41%), Glenmark Pharmaceuticals (down 2.18%), Divi's Laboratories (down 2.03%), GlaxoSmithKline Pharmaceuticals (down 1.7%), Cipla (down 1.55%), Lupin (down 1.1%) and Cadila Healthcare (down 0.52%), edged lower.
Meanwhile, the Reserve Bank of India (RBI) yesterday, 28 June 2015, clarified that RBI Governor Dr. Raghuram G. Rajan had not suggested at a London Business School conference on 25 June 2015 that the world risked sliding into another Great Depression as reported by sections of the media. The RBI clarified that what Rajan had said at that conference was that the policies followed by major central banks around the world were in danger of slipping into the kind of beggar-thy-neighbour strategies that were followed in the 1930s. Rajan called for new rules of the game in the international monetary system, a call that he has made before and is gaining some traction. The Great Depression was a period of great turmoil caused by many factors and not just beggar-thy-neighbour policies, according to the clarification issued by the RBI.
Meanwhile, the weekly data released by the Ministry of Agriculture after trading hours on Friday, 26 June 2015, showed that the sowing of Kharif crops is gathering pace. The total sown area for Kharif crops as on 26 June 2015 stood at 165.62 lakh hectares compared with 134.18 lakh hectares at this time last year.
Meanwhile, the India Meteorological Department (IMD) said in its daily monsoon update issued yesterday, 28 June 2015, that the Southwest Monsoon was vigorous over Bihar and active over Andaman & Nicobar Islands, West Bengal & Sikkim, Jharkhand and Kerala during the past 24 hours until 8:30 IST, IMD said.
For the country as a whole, the cumulative rainfall during this year's monsoon season was 23% above the Long Period Average (LPA) until 27 June 2015. Region wise, the southwest monsoon was 39% above the LPA in Central India, 33% above the LPA in Northwest India, 28% above the LPA in South Peninsula and 1% above the LPA in East & Northeast India until 27 June 2015.
On Friday, 26 June 2015, the IMD had announced that the monsoon has covered the entire country.
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.
In overseas markets, Asian stocks fell today, 29 June 2015, as investors brace for an increasingly likely Greek exit from the eurozone. Key benchmark indices in China, Hong Kong, Indonesia, Japan, Singapore, South Korea and Taiwan were down by 1.16% to 4.39%.
China's central bank cut interest rates on Saturday, 27 June 2015, and reduced the reserves that certain banks must hold. The People's Bank of China (PBoC) cut the benchmark 1-year lending rate by a quarter percentage point to 4.85%, its fourth rate cut since November. The PBoC also lowered the reserve requirement ratio for some lenders by half of a percentage point.
Trading in US index futures indicated that the Dow could fall 250 points at the opening bell today, 29 June 2015. It was a mixed day for US stocks on Friday, 26 June 2015, with technology stocks posting a decline and the Dow rising with the help of Nike.
US consumer sentiment rose to a final June reading of 96.1, reaching a five-month high after a decline in May, according to reports on the University of Michigan gauge.
In Europe, the crisis in Greece has deepened. Greek leaders imposed capital controls and closed banks for at least six days beginning today, 29 June 2015, to prevent further panicked withdrawals from citizens after the European Central Bank yesterday, 28 June 2015, decided not to expand a lifeline of emergency funds that has been sustaining Greek banks. Talks between Greece and its creditors broke down on Saturday, 27 June 2015, and the nation looks set to miss a debt repayment to the International Monetary Fund which is due tomorrow, 30 June 2015. Greece's international bailout also expires on 30 June 2015.
Greek Prime Minister Alexis Tsipras has called a referendum on Sunday, 5 July 2015, on whether the country should accept creditors' bailout terms, and has called on his people to deliver a resounding "No" vote.
The European Commission yesterday, 28 June 2015, offered Greek voters a 10-point plan for bailout requirements, urging Greece to stay in the euro area.
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