Markets suffer losses; Sensex drops 200 points

Weak rupee, downfall in global equities and slip in crude oil prices weigh

Markets continue to suffer with losses after likelihood of an interest rate hike by the US Federal Reserve in the month of June resurfaced. A win for the BJP in Assam failed to uplift the mood on the street after a downfall in the global equities amid decline in the crude oil prices.

The rupee plummeted 27 paise against the US dollar to 67.24 owing to appreciation of the American currency overseas after the minutes of the Federal Reserve raised the possibility of an interest rate hike in June.

At 2:30 pm, the S&P BSE Sensex slipped 221 points to trade at 25,484 and the Nifty50 slipped 65 points at 7,805.

GLOBAL MARKET

The Federal Reserve's April minutes released on Wednesday raised hopes of an interest rate hike amid decline in oil prices sent the Asian shares lower. Hong Kong’s Hang Seng and Singapore’s Straits Times and China’s Shanghi Composite lost between 0.11%-1.5%. Meanwhile, Japan’s Nikkei closed flat with positive bias on depreciation of yen.

Following the tandem, European shares took a hit with FTSE 100, DAX and CAC 40 dropping between 0.5%-1.5%.

Oil prices declined after recently climbing to the highest levels so far this year amid supply concerns after disruptions in Nigeria, Canada, Libya and Venezuela. 

ASSEMBLY ELECTION OUTCOME IN 5 STATES

AIADMK and Trinamool Congress retained power in Tamil Nadu and West Bengal respectively for a second consecutive term. Meanwhile, BJP won in Assam by ousting Congress and LDF set to form government in KeralaJ.  Congress-DMK alliance won in Puducherry.

STOCK TRENDS

Shares of logistics companies were trading higher by up to 9% after Finance Minister Arun Jaitley said in an interview to All India Radio recently that the GST Bill will be put to vote in the monsoon session of Parliament if Congress continues to oppose the Legislation. The GST bill, which has been approved by the Lok Sabha, is pending in the Rajya Sabha because of stiff resistance by the Congress. For the GST bill to become a law, the GST bill also needs to be approved by half the state assemblies.

Allcargo Logistics (9% at Rs 158), Gati (up 8% at Rs 128), Patel Integrated Logistics (7% at Rs 101), Kesar Terminals & Infrastructure (6% at Rs 414), Snowman Logistics (4% at Rs 60) and VRL Logistics (3% at Rs 404) were up between 3%-9% on the Bombay Stock Exchange (BSE).

Shares of oil and gas majors ONGC, RIL and GAIL suffered under pressure as slip in crude oil prices will likely hurt their margins.

Drugmaker Lupin has surged over 2% on posting better than expected results after the PAT rose 47.5% to 807 crore. Net sale crossed 4000 crore for the first time ever.  However, HDFC Bank is down 0.5% ahead of the results.

Meanwhile, Tata Motors has climbed 2% ahead of the quarter results.  Life Insurance Corporation (LIC) has hiked its stake in Tata Motors to over 7% through various open market transactions. 

Shares of technology companies witnessed an uptick on the back of a weak rupee. Infosys, Wipro and TCS gained between 0.1%-1%.

Sun TV shares sank over 12% after AIADMK looked set to return to power in Tamil Nadu. Sun TV shares had gained sharply over the last few days on hopes of a DMK victory in Tamil Nadu.

Drug firm Dr Reddy’s Laboratories is recalling over 50,000 bottles of Ondansetron tablets made at the company’s Bachupally plant in India, on account of failed impurities/ degradation specifications. The stock is trading with mild losses.

State-owned BHEL has surged 0.7% after it commissioned a 250 mw thermal unit in Maharashtra.