Key benchmark indices cut losses after hitting fresh intraday low in afternoon trade. The barometer index, the S&P BSE Sensex, was down 95.92 points or 0.45%, up 30.28 points from the day's low and off 97.25 points from the day's high. The market breadth, indicating the overall health of the market, was weak. Weakness in Asian stocks dampened sentiment on the domestic bourses. In the foreign exchange market, the rupee edged lower against the dollar.
Index heavyweight Reliance Industries (RIL) pared intraday gains in volatile trade. Many metal stocks declined on profit booking after the recent upmove triggered by the latest data which showed China's trade surplus has widened last month to the largest in more than four years as exports exceeded estimates. Jindal Steel & Power (JSPL) extended Monday's slide triggered by the Congress party's rout in assembly elections. Strides Arcolab rose in highly volatile trade after the company's board of directors at its meeting held today, 10 December 2013, approving a special dividend of Rs 500 per share.
Asian stocks edged lower on Tuesday, 10 December 2013, on heightened speculation that the Federal Reserve may be about to start cutting back on its stimulus program. The US central bank currently buys bonds worth $85 billion a month in a bid to hold interest rates low and encourage economic growth in the world's biggest economy. Fed's bond-buying program has been a source of liquidity for most Asian and emerging markets this year.
The market edged lower in early trade. Key benchmark indices hovered in negative terrain in morning trade. The Sensex extended losses and hit fresh intraday low in mid-morning trade. Weakness continued on the bourses in early afternoon trade. Key benchmark indices cut losses after hitting fresh intraday low in afternoon trade.
Foreign institutional investors (FIIs) bought shares worth a net Rs 2473.17 crore on Monday, 9 December 2013, as per provisional data from the stock exchanges.
At 13:16 IST, the S&P BSE Sensex was down 95.92 points or 0.45% to 21,230.50. The index fell 126.20 points at the day's low of 21,200.22 in afternoon trade, its lowest level since 6 December 2013. The index rose 1.33 points at the day's high of 21,327.75 in early trade. The CNX Nifty was down 39.25 points or 0.62% to 6,324.65. The index hit a low of 6,313.85 in intraday trade, its lowest level since 6 December 2013. The index hit a high of 6,362.25 in intraday trade.
The market breadth, indicating the overall health of the market, was weak. On BSE, 1,441 shares fell and 796 shares rose. A total of 151 shares were unchanged.
The total turnover on BSE amounted to Rs 1289 crore by 13:20 IST.
From the 30-share Sensex pack, 21 stocks fell and rest rose. NTPC (down 11.26%), Bhel (down 5.18%) and L&T (down 4.38%) edged lower.
TCS (up 3.72%), Wipro (up 2.43%) and ITC (up 1.5%) edged higher.
Index heavyweight Reliance Industries (RIL) rose 0.52% at Rs 883.05, with the stock paring intraday gains. The scrip hit high of Rs 888 and low of Rs 879 so far during the day.
Many metal stocks declined on profit booking after the recent upmove triggered by the latest data which showed China's trade surplus has widened last month to the largest in more than four years as exports exceeded estimates. China is the world's largest consumer of copper and aluminum.
Sail (down 0.71%), Hindustan Copper (down 2.47%), Tata Steel (down 0.21%), Hindalco Industries (down 2.06%), NMDC (down 1.99%) dropped.
Sesa Sterlite (up 0.37%), Hindustan Zinc (up 2.61%) and National Aluminum Company (up 1.62%), gained.
Jindal Steel & Power (JSPL) extended Monday's slide triggered by the Congress party's rout in assembly elections. JSPL chairman Naveen Jindal is a member of parliament representing the ruling Congress party. The stock fell 1.28%. It had lost 6.01% on Monday, 9 December 2013.
China last month released a broad outline for structural reform of the economy.
Hexaware Technologies gained 3.1% after the company's board of directors approved the merger of a business process outsourcing with itself. Hexaware Technologies after market hours on Monday, 9 December 2013 said that the company's board of directors at its meeting held on Monday, 9 December 2013, approved the merger of the wholly owned subsidiary company, Caliber Point Business Solutions, a business process outsourcing (BPO) service provider, with itself.
Strides Arcolab rose 1.08% to Rs 873.50 in highly volatile trade. The stock rose as much as 3.57% to day's high of Rs 895 and fell as much as 8.09% at the day's low of Rs 794.30 so far during the day. The high volatility was triggered by the company's board of directors at its meeting held today, 10 December 2013, approving a special dividend of Rs 500 per share. The company has fixed 20 December 2013 as record date for payment of special dividend.
Oberoi Realty (up 5.68%), Bharat Forge (up 3.14%), Amara Raja Batteries (up 3.13%), United Phosphorus (up 2.67%) and Bharti Infratel (up 2.32%) were among the top gainers from the BSE's 'A' group.
Union Bank of India (down 4.73%), IRB Infrastructure Developers (down 4.23%), Reliance Capital (down 3.84%), IDFC (down 3.61%) and HDIL (down 3.47%) were among the top losers from the BSE's 'A' group.
In the foreign exchange market, the rupee edged lower against the dollar on heightened speculation that the Federal Reserve may be about to start cutting back on its stimulus program. The partially convertible rupee was hovering at 61.265, compared with its close of 61.13/14 on Monday, 9 December 2013.
Bond prices rose after Brent oil futures slumped on Monday, 9 December 2013, following news of weaker German industrial output. Brent North Sea crude for January, the European benchmark, tumbled $2.22 to settle at $109.39 a barrel in London trade. The yield on the most traded and new 10-year federal paper -- 8.83% GS 2023 -- was hovering at 8.8775%, lower than its close of 8.9041% on Monday, 9 December 2013. Bond yield and bond prices are inversely related.
On the political front, the Congress has retained power in Mizoram with a landslide victory in the Assembly elections held on 25 November 2013, the results of which were declared on Monday, 9 December 2013. In the elections to the 40-member Assembly, the Congress has won 33 of the 39 seats declared so far. Chief Electoral Officer of Mizoram Ashwani Kumar told to media reporters that the results of Lawngtlai East constituency would be announced only on December 12 as re-polling would be held on December 11 in one polling booth where the Electronic Voting Machine failed.
Earlier, the Congress had performed poorly with the Bharatiya Janata Party (BJP) securing emphatic victory in assembly elections in Madhya Pradesh and Rajasthan, a narrower one in Chhattisgarh and emerged as the single largest party in a hung Delhi assembly, giving the party and its leader Narendra Modi confidence and momentum going into next year's general elections. Counting of votes for assembly elections in Rajasthan, Delhi, Madhya Pradesh and Chattisgarh took place on Sunday, 8 December 2013.
On macro front, the Reserve Bank of India (RBI) announces next Mid-Quarter Review of Monetary Policy for 2013-14 on 18 December 2013. The Third Quarter Review of Monetary Policy for 2013-14 is scheduled 28 January 2014.
Asian stocks edged lower on Tuesday, 10 December 2013, on heightened speculation that the Federal Reserve may be about to start cutting back on its stimulus program. Key benchmark indices in Taiwan, South Korea, Singapore, China, Japan and Hong Kong were off 0.01% to 0.72%. Indonesia's Jakarta Composite rose 1.27%. Fed's bond-buying program has been a source of liquidity for most Asian and emerging markets this year.
A series of Chinese data released on Tuesday, 10 December 2013, painted a mixed picture of the economy, with industry moderating its strong growth but retail sales picking up their already robust pace. Industrial output for November rose 10% from a year earlier, slowing from the previous month's 10.3% increase. Retail sales rose 13.7% in November, accelerating from October's 13.3% rise. Tuesday's data also included urban fixed-asset investment, which was up an annualized 19.9% in the January-November period, slowing from a 20.1% gain for January-October. Fixed-asset investment, which is reported on a year-to-date basis, is seen as an indicator of construction activity in China.
Trading in US index futures indicated that the Dow could rise 4 points at the opening bell on Tuesday, 10 December 2013. US stocks eked out small gains on Monday, 9 December 2013, as investors weighed the timing of any cuts to Federal Reserve monetary support amid budget negotiations in Washington.
Fed Bank of St. Louis President James Bullard on Monday, 9 December 2013, said that the odds of a reduction to Fed's bond purchases have risen along with gains in the labor market. Any cut should be small because inflation is slow, he said. "A small taper might recognize labor-market improvement while still providing the committee the opportunity to carefully monitor inflation during the first half of 2014. Should inflation not return toward target, the committee could pause tapering at subsequent meetings," said Bullard, who votes on policy this year but not next.
Dallas Fed President Richard Fisher said that tapering needs to begin "as soon as possible" in an economy that doesn't need any more monetary stimulus. Fisher votes on policy next year.
Investors are keeping a close watch on economic data in the United States as the Federal Reserve monitors the pace of recovery to gauge when it will begin to reduce monetary stimulus for the US economy, which has been aimed at encouraging growth. The Federal Open Market Committee (FOMC) holds a two-day policy meeting on interest rates in the United States on 17-18 December 2013. The US central bank currently buys bonds worth $85 billion a month in a bid to hold interest rates low and encourage economic growth in the world's biggest economy. Minutes of the Fed's October meeting released on 20 November 2013 showed officials may reduce their $85 billion a month of bond buying if the economy improves as anticipated.
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