Market turns volatile

Volatility continued as key benchmark indices pared losses after extending losses in mid-afternoon trade. At 14:16 IST, the barometer index, the S&P BSE Sensex, was down 169.18 points or 0.66% at 25,634.60. The Nifty 50 index was down 50.85 points or 0.65% at 7,793.50. The Sensex fell 232.33 points or 0.90% at the day's low of 25,571.45 in mid-afternoon trade. The barometer index fell 14.27 points or 0.06% at the day's high of 25,789.51 in early trade. The Nifty fell 69.80 points or 0.89% at the day's low of 7,774.55 in mid-afternoon trade. The index fell 8.20 points or 0.1% at the day's high of 7,836.15 in early trade.

Meanwhile, the government has lowered its growth forecast for the year ending 31 March 2016 (FY 2016) to 7-7.5% from 8.1-8.5% estimated in February. The revised forecast is as per the mid-year economic review tabled by the government in parliament today, 18 December 2015, according to reports. The mid-year economic review reiterated that the government would meet its fiscal deficit target of 3.9% and revenue deficit target of 2.8% for the current fiscal, according to reports.

Overseas cues were negative. Asian and European shares fell after losses for US stocks overnight. Japanese stocks edge lower amid high volatility. The Nikkei 225 Average lost 1.9%. The Bank of Japan surprised financial markets by announcing additional measures to its three-year old easing program after the conclusion of two-day monetary policy meeting.

Closer home, the market breadth indicating the overall health of the market was positive. On BSE, 1,313 shares rose and 1,248 shares fell. A total of 214 shares were unchanged. The BSE Mid-Cap index was currently up 0.34%. The BSE Small-Cap index was currently up 0.05%. Both these indices outperformed the Sensex.

Shares of Bajaj Auto dropped 1.92% at Rs 2,475.65 after a sharp slide in Argentina's currency peso. The peso tumbled more than 25% yesterday, 17 December 2015, after the new government of President Mauricio Macri reportedly said that it would lift currency controls to attract investors and kick-start the economy. Reports suggest that Argentina is a key export market for two-wheeler major Bajaj Auto. The company gets around 20% of its revenue from exports to Latin America, as per reports.

Mahindra & Mahindra (M&M) rose 0.51% at Rs 1,253.25 after the company unveiled its much awaited compact sports utility vehicle (SUV) Mahindra KUV100. The stock was volatile. The stock hit a high of Rs 1,253 and a low of Rs 1,235.60 so far during the day. Mahindra KUV100 will be available in 7 colors, the company said. M&M also unveiled an all new, world-class engine family named mFALCON, marking its entry into the ground up petrol space. The announcement was made during market hours today, 18 December 2015.

Maruti Suzuki India was down 0.61% to Rs 4,637.65 after the company announced after market hours yesterday, 17 December 2015, that its shareholders have approved a move by the company to let its Japanese parent Suzuki Motor Corporation invest and own an upcoming plant in Gujarat. Maruti said that 89.75% votes cast were in favour of the resolution through physical & electronic mode that took place from 16 November to 15 December 2015. Suzuki Motor Gujarat, a wholly owned subsidiary of Suzuki Motor Corporation will set up a car manufacturing unit in Gujarat. Maruti will buy cars from Suzuki Motor Gujarat.

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