Nifty below 11,500; IT stocks tumble

Key barometers once again slipped into negative terrain in early afternoon trade as profit selling emerged at higher levels. The Nifty index was trading below 11,500-mark. At 12:27 IST, the barometer index, the S&P BSE Sensex, was down 29.17 points or 0.08% at 38,638.16. The Nifty 50 index fell 13.35 points or 0.12% at 11,461.10.

The S&P BSE Mid-Cap index was down 0.7%. The S&P BSE Small-Cap index was down 0.78%.

The market breadth was titled in favour of bears. On the BSE, 788 shares rose and 1338 shares fell. A total of 132 shares were unchanged.

Tata Communications was up 0.05% after Rekha Rakesh Jhunjhunwala bought 19.65 lakh shares at Rs 370 each while Amansa Holding sold 18.52 lakh shares at Rs 370 each via bulk deals on BSE yesterday, 30 September 2019.

Ashok Leyland was down 3.64% to Rs 66.25 after total vehicle sales fell 55% to 8780 units in September 2019 against 19374 units September 2018. Total domestic sales fell 57% to 7851 units while the domestic M&HCV sales declined by 69% to 4035 units in September 2019 over September 2018. Total vehicle sales fell by 5.80% to 8780 units in September 2019 as against 9231 units in August 2019.

Shares of city gas distributors advanced after the government cut domestic gas price cut by 12.5% to $3.23 a unit. Adani Gas, (up 3.83%), Indraprastha Gas (up 1.40%) and Mahanagar Gas (up 0.50%) advanced. Gujarat Gas was down 0.82%.

The Ministry of Petroleum and Natural Gas has lowered the price of domestically produced natural gas to $3.23 per million British thermal unit (mBtu). This price will be applicable from 1 October 2019 to 31 March 2020. The new price is 12.5% lower than the $3.69 mBtu natural gas price for the 1 April 2019 to 30 September 2019 period. The ceiling price allowed for gas to be produced from difficult fields has also been lowered to $8.43 a mBtu from $9.32 a mBtu. Domestic natural gas price in the country is governed as per the New Domestic Gas policy, 2014.

Shares of IT companies tumbled. TCS (down 1.96%), HCL Technologies (down 1.62%), Oracle Financial Services Software (down 1.46%), Wipro (down 1.38%), Zensar Technologies (down 1.12%), Mphasis (down 0.75%), Infosys (down 0.72%) and Tech Mahindra (down 0.44%) declined.

The S&P BSE IT index was down 1.18% at 15,485.10. The Nifty IT index was down 1.1% at 15,369.10.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 70.93, compared with its close of 70.87 during the previous trading session.

On the derivatives front, the NSE's India VIX, a gauge of market's expectation of volatility over the near term, rose 1.19% at 16.0625. The Nifty October 2019 futures were trading at 11,563.65, a premium of 68.05 points compared with the spot at 11,495.60.

On the options front, the Nifty option chain for 31 October 2019 expiry showed maximum call open interest (OI) of 20.46 lakh contracts at the 11,500 strike price. Maximum put OI of 19.31 lakh contracts was seen at 11,000 strike price. The option chain indicates that Nifty will stay between 11,000 and 11,500 in October expiry.

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