Sensex settles below 26,000

Trading for the week started on a sour note as key benchmark indices recorded about 1.5% losses and extended their recent losses. The barometer index, the S&P BSE Sensex shed 385.10 points or 1.47% at 25,765.14, as per the provisional closing data. The losses for the Nifty 50 index were higher in percentage terms than those for the Sensex. The Nifty slumped 130.30 points or 1.61% at 7,943.80, as per the provisional closing data. The Sensex provisionally closed below the psychological 26,000 mark after falling below that mark in morning trade. The Nifty provisionally settled below the psychological 8,000 level after sliding below that mark in mid-morning trade. The Nifty and the Sensex, both, hit almost six-month low in intraday trade. All the nineteen sectoral indices on BSE were in the red.

Indices remained in the negative zone throughout the session after slipping into the red in early trade after opening in the positive terrain. The Sensex lost 432.31 points or 1.65% at the day's low of 25,717.93 in late trade, its lowest level since 25 May 2016. The barometer index rose 120.04 points or 0.45% at the day's high of 26,270.28 at the onset of the trading session. The Nifty lost 157.70 points or 1.95% at the day's low of 7,916.40 in late trade, its lowest level since 25 May 2016. The index rose 28.35 points or 0.35% at the day's high of 8,102.45 at the onset of the trading session.

The recent selling by the foreign portfolio investors (FPIs) of Indian stocks weighed on sentiment. FPIs sold shares worth a net Rs 926.32 crore on Friday, 18 November 2016, as per provisional data released by the stock exchanges. FPIs were net sellers for the seventh straight session. Likely short term negative impact on the economy of recent demonetization of higher denomination notes by the Indian government and worries that the recently elected US president Donald Trump's policies stance - from protectionism and fiscal expansion - will boost inflation and lead the Federal Reserve to raise interest rates more than expected continued to weigh on sentiment. Investors fear that the higher interest rates in the US will spark capital outflows from the emerging equity markets.

In overseas stock markets, European stocks reversed intraday gains in volatile trade. Asian stocks witnessed a mixed trend. US stock market finished lower on Friday, 18 November 2016, but higher for the week as Wall Street heads into a holiday-shortened week when the focus will be on a slew of economic data and fresh scrutiny of a suddenly surging US dollar and rising interest rates. A recent rally sparked by bullishness about President-elect Donald Trump's potential pro-growth fiscal policies helped pushed stocks back toward record levels. Friday's trading was subdued as investors pulled back and focused on remarks made on the previous day by Federal Reserve Chairwoman Janet Yellen that pointed to a hike in interest rates next month.

Closer home, the broad market depicted weakness. There were more than five losers against every gainer on BSE. 2,214 shares fell and 417 shares rose. A total of 147 shares were unchanged. The BSE Mid-Cap index provisionally fell 2.8%. The BSE Small-Cap index provisionally dropped 3.16%. The decline in both these indices was higher than the Sensex's decline in percentage terms.

The total turnover on BSE amounted to Rs 2541.16 crore, higher than turnover of Rs 2412 crore registered during the previous trading session.

Index heavyweight and cigarette maker ITC dropped 0.9%. The company announced that consequent to subscription of the entire share capital of Indivate Inc., USA by its step down wholly owned subsidiary, ITC Infotech (USA), Inc. on 18 November 2016, Indivate Inc. became a wholly-owned subsidiary of ITC. ITC Infotech (USA), Inc. is a wholly-owned subsidiary of ITC Infotech India which in turn is a wholly-owned subsidiary of ITC. The announcement was made during market hours today, 21 November 2016.

Realty stocks extended recent steep losses on worries of slowing demand post government's move to demonetize higher denomination notes in crackdown on black money as this sector is known to have a high volume of cash transactions, being the preferred route for stowing black money. Indiabulls Real Estate (down 8.21%), Unitech (down 7.19%), Oberoi Realty (down 4.64%), Housing Development & Infrastructure (down 3.54%), Sobha (down 0.08%), DLF (down 5.84%), and Godrej Properties (down 3.28%) slumped.

NBCC (India) shed 4.26%. The company's consolidated net profit rose 1.42% to Rs 69.11 crore on 15.75% increase in net sales to Rs 1224.41 crore in Q2 September 2016 over Q2 September 2015. The result was announced after market hours on Friday, 18 November 2016.

Auto stocks also dropped. Maruti Suzuki India (down 3.03%), Eicher Motors (down 6.22%), Bajaj Auto (down 1.5%), Ashok Leyland (down 4.9%), Tata Motors (down 3%) and TVS Motor Company (down 4.51%) declined. Hero MotoCorp rose 0.29%.

Mahindra & Mahindra (M&M) dropped 2.75%. The company announced that it inaugurated a state of the art spare parts warehouse in Mahindra World City (MWC), Jaipur. The announcement was made during market hours today, 21 November 2016. The warehouse will cater the requirement of company's customers in north and north western region of the country for both automotive and tractor spare parts. Spread over an 11 acre plot with an additional 5 acres for future expansion, this state-of-the-art spare parts warehouse aims to significantly reduce the order processing time for its customers based in North India. The processing time for the availability of spare parts and distance-to-market is expected to take less than 4 days. The company will procure spare parts from over 1,000 vendors and 9 plants for this new facility. With an investment of Rs. 150 crore, it will generate employment for over 450 direct and indirect employees.

This is the Mahindra's fourth spare parts warehousing facility, with the others being in Kanhe for automotive parts, Bhiwandi for tractor parts & Hyderabad for commercial vehicle parts, which send out supplies directly to dealerships and in the open market. The world class warehouse in MWC, Jaipur has state-of-the-art infrastructure including a 4 storied warehouse for stock storage, a store capacity for Rs 130 crore of inventory and extreme flexibility in the storage system.

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