IT, cement stocks decline

Stocks continued to trade with weakness in mid-morning trade. At 11:16 IST, the barometer index, the S&P BSE Sensex, was down 218.92 points or 0.61% at 35,520.24. The Nifty 50 index was down 69.40 points or 0.64% at 10,787.30. IT stocks dropped. Cement stocks declined. Negative Asian stocks weighed on the domestic bourses.

Domestic stocks edged lower in early trade tracking negative Asian stocks after the US Federal Reserve struck a hawkish tone in its latest policy statement. Fresh selling in index pivotals pulled the key benchmark indices to intraday low in morning trade.

The S&P BSE Mid-Cap index was down 0.35%. The S&P BSE Small-Cap index was down 0.14%. Both these indices outperformed the Sensex.

The market breadth, indicating the overall health of the market, was negative. On the BSE, 893 shares rose and 1323 shares fell. A total of 103 shares were unchanged.

Traders and investors are closely awaiting a series of domestic and global events this week. The wholesale price index (WPI) inflation data will be announced today, 14 June 2018.

On the global front, the European Central Bank (ECB) will hold its policy meeting today, 14 June 2018, in which policy makers are poised to hold formal talks on ending its bond-buying program. The Bank of Japan meets tomorrow, 15 June 2018 with no change to policy expected.

Overseas, Asian stocks followed US equities lower as the Federal Reserve struck a hawkish tone in its latest policy statement. US stock benchmarks ended near session lows yesterday, 13 June 2018 as the Federal Reserve completed its second increase to benchmark interest rates in 2018, as expected, but signaled a slightly more aggressive plan to tighten monetary policy this year than had previously been projected.

The Federal Reserve voted to raise its benchmark federal-funds rate by a quarter percentage point to a range of 1.75% to 2%. Policymakers also projected a slightly faster pace of rate increases in the coming months, with two additional hikes expected by the end of this year, compared to one previously. They see another three rate increases next year, a pace unchanged from their previous forecast.

Chairman Jerome Powell said the Fed was comfortable with a return of once-dormant inflation and emphasized the central bank's desire to avoid a policy error that could result in unnaturally inflating asset valuations or pushing the economy into a recession.

Back home, engineering and construction major L&T shed 0.27%. L&T Hydrocarbon Engineering (LTHE), a wholly owned subsidiary of L&T, has won new orders in excess of Rs 750 crore in its Construction Services business vertical. The Water & Effluent Treatment business secured orders worth Rs 432 crore. The Smart World & Communication business has secured an order worth Rs 209 crore. The announcement was made during market hours today, 14 June 2018.

IT stocks dropped. TCS (down 1.51%), Infosys (down 2.57%), Wipro (down 1.13%), Oracle Financial Services Software (down 1.04%), Tech Mahindra (down 1.84%), MindTree (down 3.39%) declined. HCL Technologies (up 1.28%) rose.

Cement stocks declined. Ambuja Cements (down 1.03%), ACC (down 0.98%), UltraTech Cement (down 1.26%) and Shree Cement (down 0.22%) fell.

Grasim Industries was off 0.19%. Grasim has exposure to the cement sector through its holding in UltraTech Cement.

Alembic Pharmaceuticals rose 7%. Alembic Pharmaceuticals announced that it has received approval from the US Food & Drug Administration (USFDA) for its Abbreviated New Drug Application (ANDA) for Doxycycline Hyclate capsules USP, 50 mg and 100 mg. The approved ANDA is therapeutically equivalent to the reference listed drug product (RLD), Vibramycin capsules, 50 mg and 100 mg, of Pfizer Inc. The announcement was made during trading hours today, 14 June 2018.

Doxycycline is indicated for a wide variety of bacterial infections including those caused by several gram-negative as well as gram-positive microorganisms. Doxycycline is also indicated for the prophylaxis of malaria due to Plasmodium falciparum in short-term travelers (<4 months) to areas with chloroquine and/or pyrimethaminesulfadoxine resistant strains. Doxycycline may be a useful adjunctive therapy in severe acne and in acute intestinal amebiasis.

Doxycycline Hyclate capsules USP, 50 mg and 100 mg, have an estimated market size of $80 million for twelve months ending December 2017 according to IQVIA. Alembic now has a total of 73 ANDA approvals (65 final approvals and 8 tentative approvals) from USFDA.

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