Key indices register small losses

A day after surging to fresh record high, key benchmark indices drifted lower today, 9 September 2014, as dollar rose against a basket of other major global currencies on speculation US interest rates may rise faster than investors anticipated. The losses for key indices were small at close, with indices trimming intraday decline. An increase in US interest rates will reduce the attractiveness of higher-yielding emerging-market assets including Indian stocks. The barometer index, the S&P BSE Sensex, was provisionally down 55.97 points or 0.2% at 27,263.88. The market breadth indicating the overall health of the market was positive. Cipla rose after the company announced the commercial collaboration with UK-based S&D Pharma in the Czech Republic and Slovakia. Ashok Leyland jumped after the company said it has bagged orders worth nearly Rs 1500 crore for supply of buses under JNNURM-II scheme. Realty stocks declined.

Key indices remained in red almost throughout the trading session. Earlier, key indices had briefly reversed small losses registered in early trade.

European stocks reversed initial losses amid concern US interest rates may rise faster than investors anticipated. Asian stocks rose, with Japanese shares gaining on a weak yen. Brent crude oil futures fell, extending previous day's decline.

As per provisional closing, the S&P BSE Sensex was down 55.97 points or 0.2% at 27,263.88. The index fell 142.76 points at the day's low of 27,177.09 in afternoon trade. The index rose 8.42 points at the day's high of 27,328.27 in early trade.

The CNX Nifty was down 22.10 points or 0.27% at 8,151.80. The index hit a low of 8,126.50 in intraday trade. The index hit a high of 8,174.55 in intraday trade.

The market breadth indicating the overall health of the market was positive. On BSE, 1,667 shares gained and 1,338 shares fell. A total of 95 shares were unchanged.

The BSE Mid-Cap index was up 49.70 points or 0.51% at 9,843.37. The BSE Small-Cap index was up 34.15 points or 0.31% at 10,885.98. Both these indices outperformed the Sensex.

The total turnover on BSE amounted to Rs 3408 crore, lower than Rs 3602.14 crore on Monday, 8 September 2014.

Hero MotoCorp (down 1.51%), Bharat Heavy Electricals (Bhel) (down 1.41%) and Bajaj Auto (down 1.39%) edged lower from the Sensex pack.

Coal India (up 2.03%), Tata Motors (up 1.38%) and ITC (up 1.26%) edged higher from the Sensex pack.

Cipla gained 2.73% to Rs 578.80. Cipla after market hours on Monday, 8 September 2014, announced the commercial collaboration with UK-based S&D Pharma in the Czech Republic and Slovakia. This collaboration will enable Cipla to focus on its core therapy areas, while S&D Pharma will be the key partner for generics, the company said. Under the collaboration, Cipla will be driving its respiratory product portfolio in both Czech Republic and Slovakia through a Cipla owned sales force team, managed by Cipla commercial head. S&D Pharma will physically distribute all products, including respiratory products, and this portfolio will increase over the next few years, Cipla said.

IndusInd Bank rose 1.45%. The private sector bank during market hours said that it has opened a new branch in New Friends Colony, New Delhi. The bank said that it plans to further strengthen its presence and customer reach in the country's capital with more branches in the coming quarters. With the inauguration of new branch, IndusInd Bank now has 27 branches in New Delhi.

Ashok Leyland gained 5.31% to Rs 40.65 after hitting a 52-week high of Rs 41.30 in intraday trade. The company during trading hours today, 9 September 2014 said has bagged orders worth nearly Rs 1500 crore for supply of buses under JNNURM-II scheme. Ashok Leyland said it has received orders for around 4000 buses from state transport undertakings (STUs). A total of 22 STUs across the country including Calcutta State Transport Corporation (CSTC), Bangalore Metropolitan Transport Corporation (BMTC), Andhra Pradesh State Road Transport Corporation (APSRTC), Jaipur City Transport Services (JCTSL), and Pune Mahanagar Parivahan Mahamandal (PMPML) have placed large orders on the company.

The supply of these buses has started and many of them are already carrying passengers, the company said in a statement.

Realty stocks declined. DLF (down 1.5%), Indiabulls Real Estate (down 2.22%), Housing Development and Infrastructure (down 1.05%), Unitech (down 3.21%), Godrej Properties (down 1.41%), Oberoi Realty (down 1.23%) and Parsvnath Developers (down 3.25%) declined.

Key benchmark indices had surged to fresh record high yesterday, 8 September 2014, following a decline in Brent crude prices. Provisional data released by the stock exchanges after trading hours yesterday, 8 September 2014, showed that foreign portfolio investors (FPIs) bought shares worth a net Rs 1162.98 crore on that day.

Brent crude oil futures edged lower, extending previous day's decline amid concerns of ample global supply and slower-than-expected growth in the world's top oil consumers. Brent for October settlement was off 24 cents at $99.96 a barrel. The contract fell 62 cents to settle at $100.20 a barrel yesterday, 8 September 2014. It had slumped to $99.36 in intraday trade yesterday, the lowest since 1 May 2013, before rebounding into three-digit territory.

Lower crude oil prices will help India in containing its fiscal deficit, current account deficit and fuel price inflation. India imports 80% of its crude oil requirement. However, the weakness in rupee against the dollar will limit the benefit of lower crude oil prices.

Iraq's parliament yesterday, 8 September 2014, approved a new government headed by Prime Minister Haider al-Abadi in a move to save Iraq from collapse.

The European Union yesterday, 8 September 2014, adopted new sanctions against Russia over the Ukraine crisis, but enforcement will be delayed while an assessment is being done on whether a ceasefire in Ukraine is holding. The measures will target the ability of Russia's top oil producers to raise capital in Europe, according to reports.

In the foreign exchange market, the rupee edged lower against the dollar on a broad strength in dollar in global currency markets. The partially convertible rupee was hovering at 60.6075, compared with its close of 60.295 on Monday, 8 September 2014.

Meanwhile, as per a statement issued by White House on Monday, 8 September 2014, India's Prime Minister Narendra Modi will meet US President Barack Obama at the White House on 29-30 September 2014. The two leaders will discuss a range of issues of mutual interest in order to expand and deepen the US-India strategic partnership. They will discuss ways to accelerate economic growth, bolster security cooperation, and collaborate in activities that bring long-term benefits to both countries and the world.

European stocks reversed initial losses today, 9 September 2014, amid concern US interest rates may rise faster than investors anticipated. Key benchmark indices in Germany, France and UK were off 0.11% to 0.18%.

The French trade deficit fell less-than-expected in July, industry data showed today, 9 September 2014. In a report, Ministry of Finance said that French trade deficit was at 5.5 billion euros, from 5.6 billion euros in the prior month whose figure was revised from 5.4 billion euros.

Asian stocks were trading higher today, 9 September 2014, with Japanese shares gaining on a weak yen. Key benchmark indices in Singapore, Japan and Taiwan were up 0.23% to 0.29%. Indonesia's Jakarta Composite fell 0.94%. China's Shanghai Composite was flat. Stock markets in Hong Kong and South Korea are closed for a holiday.

Trading in US index futures indicated that the Dow could fall 5 points at the opening bell on Tuesday, 9 September 2014. Most US stocks fell on Monday, 8 September 2014, as declining oil prices sent shares of energy companies lower.

A research report released yesterday, 8 September 2014, by the Federal Reserve Bank of San Francisco, fueled expectations for an earlier rate hike by the US Federal Reserve. Ahead of next week's FOMC policy meeting, which will be scrutinized for clues on the timing of the decision to raise interest rates, the report said that evidence based on surveys, market expectations, and models shows that the public seems to expect a more accommodative policy than do the Federal Open Market Committee (FOMC) participants.

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