The market declined sharply on Thursday, with banking and IT stocks leading the decline. Banks stocks tumbled due of weekly expiry of Bank Nifty options. Continuous selling by foreign portfolio investors hurt trading sentiment.
The US Federal Reserve on Wednesday cut its overnight rate by 25 basis points to a range of 1.75% to 2%, a move that was widely expected. The Fed, however, appeared divided on further action for the year.
The Bank of Japan (BoJ) kept monetary policy steady on Thursday. In an expected move, the BoJ maintained its short-term interest rate target at -0.1% and a pledge to guide 10-year government bond yields around 0%.
Back home, the barometer index, the S&P BSE Sensex, fell 470.41 points or 1.29% to 36,093.47, as per the provisional closing data. The Nifty 50 index fell 143.90 points or 1.33% to 10,696.75, as per the provisional closing data.
The Nifty slipped below 10,800 level in morning trade and extended losses as the session progressed. The index slipped below 10,700 in afternoon trade. A minor bargain hunting in the final half hour of trade pushed the Nifty above 10,700 mark.
The market breadth was weak. On the BSE, 730 shares rose and 1777 shares fell. A total of 121 shares remain unchanged. The S&P BSE Small-Cap index fell 1.48%. The S&P BSE Mid-Cap index fell 1.15%.
Among index pivotals, Reliance Industries (down 2.28%) and TCS (down 1.98%) declined.
Tata Motors (up 1.97%), UPL (up 0.98%) and Bharti Airtel (up 0.77%) bucked weak market trend.
Yes Bank (down 15.21%), Tata Steel (down 3.7%), IndusInd Bank (down 3.49%) and ICICI Bank (down 2.93%) were top losers for the day.
Zee Entertainment Enterprises (ZEE) fell 7.84% to Rs 310.50 on media reports that a Delhi High Court-appointed arbitrator asked Essel Group chairman Subhash Chandra not to sell his unpledged stake in ZEE till next month in an ongoing dispute with Indiabulls Housing Finance over default in repayment of loans worth Rs 200 crore.
Reports further added that promoters of the Essel Group, which owns ZEE, had entered into an agreement with mutual funds, getting time till 30 September to repay debt. This agreement prevented the funds from selling the shares held as collateral.
Nalco rose 0.79% to Rs 44.90 after the company announced a record 115% dividend payout amounting to Rs 1,072.73 crore for 2018-19. National Aluminium Company (Nalco) declared a record dividend payout of Rs 1072.73 crore, an increase from 114% in 2017-18 to 115% in 2018-19, which works out to Rs 5.75 per equity share of Rs 5 each. This is the highest dividend payout since the inception of the company in 1981. Dividend including the applicable dividend distribution tax works out to a payout of 74.65% of the PAT against 98.81% of previous financial year.
Drug major Lupin was down 2.3% after the company received a warning letter from the USFDA for its Mandideep (Unit-1) facility. The company assured that there are no pending approvals on Mandideep facility and thus the warning letter will not have an impact on existing revenues and operations of the facility. Furthermore, the company assured that it is working on resolving the issues raised by USFDA at the earliest.
State-run NTPC fell 0.65%. Media reports surfaced that NTPC plans to build the world's largest single-location solar plant of 5,000 MW capacity with an investment of about Rs 25,000 crore in Gujarat's Kutch district by 2024. The plant will have a 32000 MW of renewable capacity by 2024.
IIFL Wealth Management hit an upper circuit limit of 5% at Rs 1260 on the BSE after listing on bourses today, 19 September 2019. The stock opened at Rs 1200 per share, which is also its intraday low. The counter clocked volume of 36,000 shares. IIFL Wealth Management, the demerged entity of IIFL Finance (formerly known as IIFL Holdings), is the first standalone wealth management company to list in India. In March 2019, the National Company Law Tribunal (NCLT) approved the demerger of the IIFL Group. As per demerger scheme, the owner of seven shares of IIFL Finance were eligible to receive seven shares of IIFL Finance, seven shares of IIFL Securities and one share of IIFL Wealth once the spin-off companies got listed.
Reliance Nippon Life Asset Management was down 1.01% while Reliance Capital was down 3.28%. Reliance Capital clarified that no pledged shares of Reliance Nippon Life Asset Management have been invoked. Furthermore, the company also assured that borrowings covered under the pledged Reliance Nippon Life Asset Management shares are matched by cash amounting to approximate Rs 1600 crore lying in escrow under tripartite agreements signed between the parties.
Gruh Finance was down 1.35% while Bandhan Bank was up 0.46%. Gruh Finance announced that National Company Law Tribunal, Ahmedabad bench passed and sanctioned the amalgamation of Gruh Finance with Bandhan Bank. The company further stated that the approval of scheme is now pending with National Company Law Tribunal, Kolkata Bench. The Scheme will become effective upon the filing of the orders passed by both Benches.
NMDC declined 3.23% on reports that the company reduced lumps and fine prices by Rs 200 per tonne each. According to media reports, the state-owned iron ore mining company cut price of lumps by Rs 200 per tonne to Rs 2,700 per tonne. It reduced price of fines by Rs 200 per tonne to Rs 2,460 per tonne.
Overseas, European markets advanced as investors keenly look forward to Bank of England's (BoE) policy meeting, which is expected to hold discussions on interest rates, ahead of Britain's exit from the European Union.
Asian markets closed mixed on Thursday, after the US Federal Reserve signalled a doubt over further easings, while the Bank of Japan also held off from offering more stimulus as some had expected.
U.S. stocks ended mixed Wednesday. The Fed announced it would cut the benchmark federal funds rate a quarter percentage point to a range of 1.75% to 2% on Wednesday, but said in an accompanying statement that sustained expansion of economic activity, strong labor market conditions, and inflation near the committee's symmetric 2% objective are the most likely outcomes.
The Fed also released a survey of Fed Board members and regional Fed bank presidents, which showed that the median respondent believes the Fed funds rate would be at present levels through the end of 2020.
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