Indices decline further; VIX spurts

Key indices hit fresh intraday low as selling pressure intensified in the early afternoon trade. The Nifty traded below 10,900 as volatility index surged higher. HDFC AMC recorded a 52-week high.

At 12:20 IST, the barometer index, the S&P BSE Sensex, was down 467.34 points or 1.25% at 36,865.61. The Nifty 50 index was down 141.65 points or 1.28% at 10,881.20.

The S&P BSE Mid-Cap index was down 1%. The S&P BSE Small-Cap index was down 0.71%.

The market breadth, indicating the overall health of the market, remained weak. On the BSE, 784 shares rose and 1341 shares fell. A total of 134 shares were unchanged.

On the derivatives front, the NSE's India VIX, a gauge of market's expectation of volatility over the near term, jumped 9.71% at 17.865.

The Nifty September 2019 futures were trading at 10,916, a premium of 30.75 points compared with the spot at 10,885.65

On the options front, the Nifty option chain for 26 September 2019 expiry showed maximum call open interest (OI) of 21.90 lakh contracts at the 11,700 strike price. Maximum put OI of 28.54 lakh contracts was seen at 10,800 strike price. The option chain indicated that Nifty will stay between 10,800 and 11,700 till September expiry.

In the cash market, shares of HDFC Asset Management Company gained 9.75% in three trading sessions to its current market price of Rs 2633, from a recent closing low of Rs 2399.15 on 28August 2019. The stock hit an intraday high of Rs 2677 which is also a 52-week high for the counter. The stock had outperformed the market over the past one month, up 19.65% compared with 0.17% rise in the Sensex.

ONGC declined 2.15% after media reports suggested a fire break out at ONGC Uran plant. 4 persons were reported dead and 5 others were severely injured after a fire broke out in storm water drainage. Although the fire has been brought under control, gas production has been diverted to Hazira plant in Gujarat.

Reliance Power surged 7.41% after the company announced that it has entered into a joint venture with with JERA (Japan) to develop 750 MW gas based combined cycle power project at Meghnaghat in Bangladesh. Reliance Power will hold 51% stake in the project. The project that will be set up in 36 months is worth Rs 836 crore and will present as the largest FDI in power sector from India in Bangladesh.

Drug manufacturing company IOL Chemicals & Pharmaceuticals announced that it has made a pre-payment of term loan of Rs 7.99 Crore to Bank. With this the company has prepaid the term loan of Rs 115.69 Crore till date to reduce the term debt. IOL Chemicals was trading 0.79% lower at Rs 176.4.

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