Nifty hits three-week closing low

Oil and gas stocks led decline on the bourses after the government's decision to defer revision in gas prices by three months. The 50-unit CNX Nifty hit there-week closing low. The barometer index, the S&P BSE Sensex, lost 251.07 points or 0.99%, off close to 245 points from the day's high and up about 40 points from the day's low. The market breadth indicating the overall health of the market was negative. Realty stocks edged lower.

Reliance Industries (RIL), ONGC and Oil India dropped after the Cabinet Committee on Economic Affairs (CCEA) on Wednesday, 25 June 2014, deferred a decision on revision of natural gas pricing by three months. PSU OMCs edged lower after Oil Minister Dharmendra Pradhan reportedly said on Wednesday, 25 June 2014, evening that there is no proposal to raise kerosene or LPG prices. L&T rose after the company said its wholly owned subsidiary L&T Technology Services has purchased 74% of the equity capital of Thales Software India, the Indian subsidiary of Thales. Realty shares dropped.

Indian stocks were volatile today, 26 June 2014, as traders rolled over positions in the futures & options (F&O) segment from the near month June 2014 series to July 2014 series. The June 2014 F&O contracts expired today, 26 June 2014.

The S&P BSE Sensex shed 251.07 points or 0.99% to settle at 25,062.67, its lowest closing level since 23 June 2014. The index slumped 292.51 points at the day's low of 25,021.23 in late trade. The index fell 4.41 points at the day's high of 25,309.33 in early trade.

The CNX Nifty lost 76.05 points or 1% to settle at 7,493.20, its lowest closing level since 5 June 2014. The index hit a low of 7,481.30 and a high of 7,570.20 in intraday trade.

The total turnover on BSE amounted to Rs 3272 crore, higher than Rs 3221.85 crore on Wednesday, 25 June 2014.

The market breadth indicating the overall health of the market was negative. On BSE, 1,539 shares fell and 1,490 shares rose. A total of 98 shares were unchanged. The market breadth alternately moved between positive and negative during the trading session.

The BSE Mid-Cap index was down 27.82 points or 0.3% at 9,180.84. The BSE Small-Cap index was down 31.41 points or 0.31% at 9,981.31. Both these indices outperformed the Sensex.

Reliance Industries (RIL), ONGC and Oil India dropped after the Cabinet Committee on Economic Affairs (CCEA) on Wednesday, 25 June 2014, deferred a decision on revision of natural gas pricing for three months. ONGC dropped 5.46% to Rs 413. Oil India shed 2.91% to Rs 571.50. RIL fell 3.22% to Rs 1,017. The decision to defer gas price revision means that gas will be sold at prevailing price of $4.2 per unit until end September 2014.

The government said that comprehensive discussions are necessary on the issue of natural gas pricing and the gas pricing guidelines. The government said that consultations will be held with all stakeholders and public interest will be kept in mind.

The price of natural gas would have doubled to $8.4 per unit from 1 April 2014 after the Congress led United Proressive Alliance (UPA) government in January this year approved a new formula for pricing all domestic gas from 1 April 2014. However, gas price revision could not be implemented because of the electoral code of conduct due to Lok Sabha elections in April-May 2014.

PSU OMCs edged lower after Oil Minister Dharmendra Pradhan reportedly said on Wednesday, 25 June 2014, evening that there is no proposal to raise kerosene or LPG prices. Media reports had recently suggested that the Oil Ministry is mulling a staggered monthly price hike for LPG and kerosene, as is being done for diesel, in a bid to reduce the government's fuel subsidy burden. PSU OMCs have been raising diesel prices by 50 paise per litre every month after the Congress led United Progressive Alliance (UPA) government in January 2013 allowed PSU OMCs to increase the retail selling price within a small range every month.

HPCL (down 4.34% to Rs 398.10), Indian Oil Corporation (IOCL) (down 3.99% to Rs 328.30) and BPCL (down 2.25% to Rs 567.80) declined.

GAIL (India) fell 1.64% to Rs 459.75. The company clarified during market hours that apart from participation in Carrizo's Eagle Ford asset in 2011, GAIL (India) has so far not acquired any shale gas asset in US.

Gas utility stocks were mixed after the Cabinet Committee on Economic Affairs (CCEA) on Wednesday, 25 June 2014, deferred a decision on revision of natural gas pricing for three months. Gujarat Gas Company fell 2.5% to Rs 415. Gujarat State Petronet (up 4.5% to Rs 87), and Indraprastha Gas (up 1.74% to Rs 347.60) gained.

Shares of offshore oil service providers rallied. Aban Offshore (up 4.76% to Rs 760.75), Global Offshore (up 5% to Rs 361.45), Seamec (up 5% to Rs 121.30) and GOL Offshore (up 3.54% to Rs 119.80) surged.

Realty stocks edged lower. DLF (down 3.13% to Rs 210.35), Housing Development & Infrastructure (HDIL) (down 2.75% to Rs 91.90), Sobha Developers (down 1.53% to Rs 528.30), D B Realty (down 6.61% to Rs 103.15) and Unitech (down 3.75% to Rs 33.40) declined.

Metal shares declined. Jindal Steel & Power (down 2.29% to Rs 322.70), Sesa Sterlite (down 0.57% to Rs 294.50), Hindalco Industries (down 0.78% to Rs 165.30), Steel Authority of India (Sail) (down 1.27% to Rs 93.10), Tata Steel (down 0.95% to Rs 525.80), JSW Steel (down 1.23% to Rs 1,218.70), National Aluminium Company (down 1.13% to Rs 61.35) and Hindustan Zinc (down 0.87% to Rs 165.20), edged lower.

Most automobile stocks rose after the government on Wednesday, 25 June 2014, announced extension of concessional excise duty on automobiles by six months up to 31 December 2014. TVS Motor Company (up 1.13% to Rs 147.50), Mahindra & Mahindra (M&M) (up 0.28% to Rs 1,170.65), Maruti Suzuki India (up 0.41% to Rs 2,487.65) and Hero MotoCorp (up 0.17% to Rs 2,644.45) edged higher.

Bajaj Auto rose 0.27% to Rs 2,205.05 after hitting record high of Rs 2,319.25 in intraday trade.

Tata Motors fell 1.23% to Rs 447.95.

Ashok Leyland dropped 0.52% to Rs 37.90. The stock hit high of Rs 39 and low of Rs 37.55. The company said during market hours that the company and Yes Bank have signed memorandum of understanding whereby Yes Bank will extend retail financing to Ashok Leyland's commercial vehicles customers. With this tie up, the company will be able to leverage the extensive branch network and customer reach of Yes Bank and provide more efficient and effective service to its customers.

The government on Wednesday, 25 June 2014, announced extension of concessional excise duty on automobiles, capital goods and consumer durables by six months up to 31 December 2014. It may be recalled that the Congress led United Progressive Alliance (UPA) government had in Interim Budget for 2014-15 in February this year reduced excise duty on small cars, two wheelers, scooters and commercial vehicles to 8% from 12%. Excise duty on sports utility vehicles (SUVs) was cut to 24% from 30% and that on mid and large cars was cut to 24/20% from 27/24%. At that time, the reduction is excise duty was restricted till 30 June 2014 as an interim relief measure for the auto sector.

Similarly, excise duty was cut to 10% from 12% for a period up to 30 June 2014 for capital goods and consumer durable falling under chapter 84 and chapter 85 of the Schedule to the Central Excise Tariff Act. The chapter 84/85 includes products like boiler, turbine, transformers, motors, air conditioners, toaster, oven, switches, switchgears etc.

L&T rose 1.21% to Rs 1,670.40. L&T and Thales said in a joint statement during market hours that L&T's wholly owned subsidiary L&T Technology Services has purchased 74% of the equity capital of Thales Software India, the Indian subsidiary of Thales, the global technology leader in aerospace, transportation and defence and security markets. With this transaction, L&T Technology Services will now manage and oversee the management control, operations and delivery of services of the new joint venture.

The joint venture brings together the strategic strengths of both the groups. By retaining 26% equity stake, Thales will help the company develop the latest trends in the avionics industry, one of the core businesses. This collaboration adds to L&T Technology Services' growing competencies by enhancing its expertise in high-end avionic software.

The joint venture capitalises on the existing strong relationship between the two groups, L&T and Thales and ensures a long term partnership in the engineering services domain. Furthermore, the transaction should enable Thales to select this new group as its Indian offset partner, resulting in inflow of offset related revenues in the joint venture, the statement said.

Coal India was down 2.07% to Rs 389.45. The stock edged lower in late trade after a news agency quoted Sangita Chourre, joint secretary in the department of disinvestment in finance ministry, as saying that stake sale in Coal India is in "action plan".

Shares of air conditioner makers edged higher after the government on Wednesday, 25 June 2014, announced extension of concessional excise duty on consumer durables by six months up to 31 December 2014. Blue Star (up 1.65% to Rs 290.25), Whirlpool India (up 0.24% to Rs 311.05), and Hitachi Home & Life Solutions (up 0.78% to Rs 284.35) gained. Voltas (down 2.51% to Rs 215.40), and Panasonic Appliances India (down 2.35% to Rs 101.75) declined.

Dewan Housing Finance Corporation jumped 7.81% to Rs 362 after the company said that credit rating agency Credit Analysis & Research (CARE) has up-graded the ratings assigned to the long term bank facilities and other instruments/securities of the company.

Kesoram Industries surged 8.07% to Rs 119.85. The company said during market hours that the board of directors of the company at its meeting held today, 26 June 2014, constituted a core committee comprising of three directors, two of whom are independent, to consider and evaluate steps that the company may need to pursue to implement reorganisation and realignment due to the imminent necessity for the company to explore options for reorganising and realigning its existing businesses.

A bout of volatility was witnessed as key benchmark indices trimmed losses after a weak opening. A sudden slide took key benchmark indices lower in morning trade. The Sensex languished in negative terrain in early afternoon trade. Weakness continued on the bourses in afternoon trade. Key benchmark indices trimmed losses after hitting fresh intraday low in mid-afternoon trade. Volatility ruled the roost in late trade as key benchmark indices extended intraday losses. After trimming losses in mid-afternoon trade, the Sensex lost ground after a sudden slide in late trade. The barometer index once again trimmed losses at the fag end of the trading session.

Indian stocks fell for the second day in a row today, 26 June 2014. From a recent high of 25,368.90 on 24 June 2014, the Sensex has declined 306.23 points or 1.2% in two trading sessions. The Sensex has risen 845.33 points or 3.49% in this month so far (till 26 June 2014). The Sensex has gained 3,891.99 points or 19.38% in calendar year 2014 so far (till 26 June 2014). From a 52-week low of 17,448.71 on 28 August 2013, the Sensex has risen 7,613.96 points or 43.63%. From a record high of 25,725.12 hit on 11 June 2014, the Sensex is off 662.45 points or 2.57%.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 60.1625, compared with its close of 60.125/135 on Wednesday, 25 June 2014.

European markets edged lower in choppy trade on Thursday, 26 June 2014, on weaker than expected US growth figures. Key benchmark indices in France and Germany were down by 0.03% to 0.08%. UK's FTSE 100 rose 0.07%.

Asian stocks rose on Thursday, 26 June 2014, amid optimism the US economy is emerging from a worse-than-estimated contraction last quarter. Key benchmark indices in Japan, China, Indonesia, Singapore, Hong Kong, South Korea and Taiwan rose by 0.27% to 1.45%.

Trading in US index futures indicated that the Dow could fall 11 points at the opening bell on Thursday, 26 June 2014. US stocks gained for the first time in three days on Wednesday, 25 June 2014, as investors speculated the economy is recovering from a first-quarter contraction and Monsanto Co. announced a $10 billion stock buyback plan.

A report showed that US gross domestic product shrank 2.9% in the first quarter, the worst reading since 2009. Orders for business equipment climbed in May, a sign that corporate investment is helping revive the economy after slumping at the start of the year.

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