Key benchmark indices were trading near the day's low in morning trade, dragged by weakness in IT and Bank stocks. Pharma and realty stocks bucked weak market trend.
At 10:25 IST, the barometer index, the S&P BSE Sensex, was down 209.28 points or 0.56% at 37,242.89. The Nifty 50 index was down 64.65 points or 0.59% at 10,981.10.
The S&P BSE Mid-Cap index was down 0.21%. The S&P BSE Small-Cap index was down 0.31%.
The market breadth, indicating the overall health of the market, was negative. On the BSE, 726 shares rose and 955 shares fell. A total of 92 shares were unchanged.
Indiabulls Housing Finance (down 5.58%) will be replaced by Nestle (up 1.8%) in NSE's Nifty 50 Index with effect from 27 September 2019.
In Nifty IT index, Infibeam Avenues (down 0.63%) and Oracle Financial Services Software (down 1.69%) will replaced by Hexaware Technologies (down 1.15%) and Justdial (down 0.45%) with effect 27 September 2019.
Shares of eleven sugar firms rose after the cabinet approved sugar export policy for evacuation of surplus stocks during sugar season 2019-2020. Shree Renuka Sugar (up 5.15%), KCP Sugar & Industries Corporation (up 4.97%), Sakthi Sugars (up 3.8%), DCM Shriram Industries (up 3.61%), Balrampur Chini Mills (up 2.63%), Triveni Engineering & Industries (up 2.29%), EID Parry (India) (up 2.23%), Dhampur Sugar Mills (up 2.21%), Dwarikesh Sugar Industries (up 2.14%), Rana Sugars (up 0.95%) and Bajaj Hindusthan Sugar (up 0.21%) advanced.
The cabinet on Wednesday approved providing a lump sum export subsidy of Rs 10,448 per metric tonne (MT) to sugar mills for the sugar season 2019-20. The total estimated expenditure of about Rs 6,268 crore will be incurred for this purpose. The lump sum export subsidy will be provided for expenses on marketing costs including handling, upgrading and other processing costs, costs of international and internal transport and freight charges on export of up to 60 lakh metric tonne (LMT) of sugar limited to maximum admissible export quantity (MAEQ) allocated to sugar mills for the sugar season 2019-20. In wake of surplus sugar production during sugar season (SS) 2017-18 and 2018-19, notwithstanding various measures taken by the Government, the ensuing sugar season 2019-20 is expected to commence with an opening stock of about 142 LMT and season end stock are expected to be about 162 LMT. The surplus stock of 162 LMT of sugar would create downward pressure throughout the season on sugar prices affecting liquidity of the sugar mills thereby leading to accumulation of cane price arrears of farmers.
Lakshmi Vilas Bank slumped 4.91% after Parthasarathi Mukherjee, managing director & CEO, resigned from office citing personal reasons with effect from 31 August 2019.
Accelya Soultion rose 0.16% to Rs 746 after company announced its Q1 earnings. On consolidated basis, the software firm's net profit declined 0.25% to Rs 26.4 crore on 2.7% increase in revenue from operations to Rs 109 crore in Q1 June 2019 over Q4 March 2018. The company has announced a dividend of Rs 15 per share.
Overseas, Asian stocks were trading lower on Thursday as intensifying US-China frictions and worries of a no-deal Brexit drove investors to safer harbours.
US stocks climbed on Wednesday on gains in energy and financial shares. Meanwhile, the White House is scheduled to impose the first stage of U.S. tariffs on $300 billion worth of Chinese imported goods on Sunday, when China is set to respond with tariffs on U.S. products also.
In Europe, U.K. Prime Minister Boris Johnson announced plans to suspend parliament until 14 October, less than three weeks before the Britain's scheduled exit from the European Union on 31 October. The move is seen as increasing the chances of a no-deal Brexit that economists estimate could deal a significant blow to economic growth in the U.K and Europe.
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