Key benchmark indices witnessed heavy selling in the mid-afternoon trade. The Nifty broke 10,850 and descended towards 10,800 mark.
At 14:22 IST, the barometer index, the S&P BSE Sensex, was down 635.88 points or 1.71% at 36,487.43. The Nifty 50 index was down 183.65 points or 1.67% at 10,819.85.
The S&P BSE Mid-Cap index was down 1.3%. The S&P BSE Small-Cap index was down 1.43%.
The market breadth was weak. On the BSE, 751 shares rose and 1623 shares fell. A total of 149 shares were unchanged.
Shares of State Trading Corporation of India and MMTC tumbled 16.24% and 15.15% respectively after media reports suggested that the government is looking to shut operations. The government is also planning to shut operations of unlisted Project and Equipment Corporation of India (PEC).
Trade minister Piyush Goyal on Tuesday was quoted by the media as saying that the government will shut down state-owned trading companies such as State Trading Corporation (STC), Project and Equipment Corporation (PEC) and MMTC one by one as "the government has no business of remaining in such businesses". Slowly the original purpose of these public sector units have come to an end. It's not the business of the government to remain in such businesses. The government should not run companies only for gold imports. We have started the discussion and will close them down one by one. The companies have not covered themselves with glory, Goyal reportedly told the media.
Tata Communications was trading at Rs 273 as stock turns ex-spin off. The Board of Directors of Tata Communications fixed Wednesday, 18 September 2019 as the record date for determining the shareholders who shall be eligible to receive the equity shares of Hemisphere Properties India (HPIL). Tata Communications on 7 August said its scheme of arrangement for demerger of surplus land from the company to HPIL had received approval from the Ministry of Corporate Affairs (MCA). As per the demerger plan, the company would transfer the surplus land to HPIL after consequent issue of equity shares by HPIL to the shareholders of the company. HPIL shall issue and allot one equity share to each member of Tata Communications.
In the commodities market, Brent crude for November 2019 settlement was down 30 cents at $68.72 a barrel. The contract rose 14.61% to settle at $69.02 a barrel in the previous trading session after drone attack on Saudi Arabia's oil facilities forcing the kingdom to cut its oil output by half.
Oil Minister Dharmendra Pradhan reportedly said Aramco has assured India that there would be no supply disruption. "We have to wait to know the actual impact on Indian market."
Meanwhile, the yield on 10-year benchmark federal paper rose to 6.716% at 14:12 IST compared with 6.710% at close in the previous trading session.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 71.82, compared with its close of 71.60 during the previous trading session.
In the commodities market, MCX Gold futures for 4 October 2019 settlement fell 0.32% at Rs 38,057.
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