Volatility continued as key benchmark indices reversed intraday gains and hit fresh intraday low in early afternoon trade as faster-than-estimated expansion in a US services gauge stoked speculation the world's largest economy is strong enough to allow the US Federal Reserve to reduce stimulus for the US economy earlier than analysts had projected. Fed's bond-buying program has been a source of liquidity for most Asian and emerging markets this year. The S&P BSE Sensex fell below the psychological 21,000 mark. The Sensex hit its lowest level in more than a week. The 50-unit CNX Nifty hit one-week low. The Sensex was down 23.98 points or 0.11%, off close to 95 points from the day's high and up about 30 points from the day's low. The market breadth, indicating the overall health of the market, was positive.
Index heavyweight Reliance Industries (RIL) dropped. Most auto stocks gained. But, Tata Motors reversed direction after hitting record high. Bajaj Auto extended intraday losses after the company reported weak October sales. PSU OMCs rose as US crude oil futures hit five-month low on Tuesday, 5 November 2013. ABB rose on strong Q3 result.
A bout of volatility was witnessed in early trade as key benchmark regained positive terrain after slipping into the red after opening higher. The Sensex retained positive zone after striking fresh intraday high in morning trade. A bout of volatility was witnessed as key benchmark indices regained positive terrain after slipping into the red for a brief period in mid-morning trade. Volatility continued as key benchmark indices reversed intraday gains and hit fresh intraday low in early afternoon trade.
Foreign institutional investors (FIIs) bought shares worth a net Rs 162.53 crore on Tuesday, 5 November 2013, as per provisional data from the stock exchanges.
At 12:20 IST, the S&P BSE Sensex was down 23.98 points or 0.11% to 20.950.81. The index fell 55.24 points at the day's low of 20,919.55 in early afternoon trade, its lowest level since 29 October 2013. The index rose 70.59 points at the day's high of 21,045.38 in morning trade.
The CNX Nifty was down 12.20 points or 0.2% to 6,240.95. The index hit a low of 6,229.15 in intraday trade, its lowest level since 30 October 2013. The index hit a high of 6,269.70 in intraday trade.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,216 shares rose and 946 shares fell. A total of 121 shares were unchanged.
Among the 30-share Sensex pack, 17 stocks fell and rest of them rose. Sesa Sterlite (down 2.55%), Hindalco Industries (down 1.87%) and SBI (down 1.51%), edged lower.
Index heavyweight Reliance Industries (RIL) dropped 0.67%.
Most auto stocks gained. M&M (up 0.17%), Maruti Suzuki India (up 0.38%) and Hero MotoCorp (up 1.05%), gained.
But, Tata Motors declined 0.61% to Rs 392.75. The stock reversed direction after hitting record high of Rs 400.70 in intraday trade.
Bajaj Auto fell 1.38%, with the stock extending intraday losses after the company reported weak sales for October 2013. The company said before market hours today, 6 November 2013, that its total sales fell 6% to 3.85 lakh units in October 2013 over October 2012. Motorcycles sales declined 4% to 3.48 lakh units in October 2013 over October 2012. Commercial vehicles sales dropped 26% to 37,000 units in October 2013 over October 2012. Exports rose 9% to 1.38 lakh units in October 2013 over October 2012.
PSU OMCs rose as US crude oil futures hit five-month low on Tuesday, 5 November 2013. HPCL (up 1.23%) and Indian Oil Corporation (up 1.24%), gained. But, BPCL fell 0.25%. Lower crude oil prices could reduce under-recoveries of state-run oil marketing companies (PSU OMCs) on domestic sale of diesel, LPG and kerosene at controlled prices. In January 2013, the government allowed PSU OMCs to raise diesel prices in small measures at regular intervals while completely deregulating diesel prices sold to institutional or bulk buyers. The government has already freed pricing of petrol.
US crude oil futures for December 2013 delivery were up 53 cents a barrel at $93.90 a barrel in the electronic trading today, 6 November 2013. The contract had declined $1.25 a barrel to close at a five-month low on the New York Mercantile Exchange on Tuesday, 5 November 2013.
Divi's Laboratories rose 0.92% to Rs 996.25. Two block deals were executed in the counter on BSE. One block deal of 1.12 lakh shares was struck at Rs 985 per share at 10:39 IST. Another block deal was of 3.38 lakh shares was executed at Rs 989.55 per share at 10:39 IST.
ABB rose 3.49% on good Q3 result. The company's net profit jumped 78.14% to Rs 38.07 crore on 1.25% fall in total income to Rs 1786.82 crore in Q3 September 2013 over Q3 September 2012. The company announced result during market hours. ABB's order intake rose 5% to Rs 1762 crore in Q3 September 2013 over Q3 September 2012.
In the foreign exchange market, the rupee edged lower against the dollar, tracking global gains in the dollar after a gauge of US service industries climbed more than forecast in October, adding to the case for the US Federal Reserve to taper monthly bond purchases. The partially convertible rupee was hovering at 61.965, compared with its close of 61.625/635 on Tuesday, 5 November 2013.
Indian government bond prices dropped as faster-than-estimated expansion in a US services gauge stoked speculation the world's largest economy is strong enough to allow the US Federal Reserve to reduce stimulus for the US economy earlier than analysts had projected. The yield on the benchmark government paper viz. 7.16% GS 2023 was hovering 8.7918%, higher than its close of 8.7368% on Tuesday, 5 November 2013. Bond yield and bond prices are inversely related.
Asian stocks edged higher on Wednesday, 6 November 2013, as Japanese shares were boosted by the yen weakening against the dollar and Commonwealth Bank of Australia posted a surge in profit. Key benchmark indices in Singapore, Hong Kong, Taiwan, Indonesia and Japan rose 0.01% to 0.79%. Key benchmark indices in China and South Korea shed 0.01% to 0.45%.
China's leaders will meet in Beijing on November 9-12 to map out economic policies as the country heads for its slowest annual growth in more than two decades.
Indonesia's economy expanded less than 6% last quarter as higher interest rates weighed on consumption and exports fell. Gross domestic product increased 5.62% in the three months ended Sept. 30 from a year earlier, the Central Bureau of Statistics said in Jakarta today. That compares with 5.81% growth for the second quarter.
Trading in US index futures indicated that the Dow could advance 59 points at the opening bell on Wednesday, 6 November 2013. US stocks closed mostly lower on Tuesday, 5 November 2013, after a gauge of service industries climbed more than forecast in October, adding to the case for the Federal Reserve to taper monthly bond purchases.
The US Institute for Supply Management's gauge of service industries climbed more than strategists predicted, data showed yesterday, stoking concern that the world's biggest economy is faring well enough for the Fed to consider reducing asset purchases. Fed policy makers last week signaled diminishing concern over higher borrowing costs as they maintained their $85 billion in monthly bond-buying and sought more evidence of sustained growth before paring stimulus.
The US government will on Friday, 8 November 2013, release nonfarm payrolls figures for October 2013. The job data is a key economic indicator that has been watched closely in recent months to see whether the US Federal Reserve will roll back its bond-buying program.
In Europe, the European Union yesterday cut its forecast for euro-area growth next year and raised its unemployment estimate as the economy struggles to regain momentum after a record-long recession.
The European Central Bank (ECB) holds a monetary policy meeting tomorrow, 7 November 2013. The ECB is seen retaining its key policy rate at a record-low 0.5%.
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