Key benchmark indices languished in negative zone in early afternoon trade. The market breadth, indicating the overall health of the market, turned negative from positive. Weakness in Asian stocks dampened investor sentiment. The barometer index, the S&P BSE Sensex, was down 19.87 points or 0.09%, off close to 40 points from the day's high and up about 50 points from the day's low.
Auto stocks were mixed. Most bank pivotals gained. Bharti Infratel rose after reporting strong Q3 results.
A bout of volatility was witnessed as key benchmark indices trimmed losses after a weak start triggered by weak Asian stocks. Key benchmark indices swung alternately between positive and negative terrain near the flat line in mid-morning trade. Key benchmark indices languished in negative zone in early afternoon trade.
Foreign institutional investors (FIIs) bought shares worth a net Rs 279.45 crore on Wednesday, 22 January 2014, as per provisional data from the stock exchanges.
Asian stocks declined on Thursday, 23 January 2014, after a private gauge of China's manufacturing in January unexpectedly contracted.
At 12:20 IST, the S&P BSE Sensex was down 19.87 points or 0.09% to 21,317.80. The index dropped 72.96 points at the day's low of 21,264.71 in early trade. The index rose 17.67 points at the day's high of 21,355.34 in morning trade.
The CNX Nifty was down 8.85 points or 0.14% to 6,330.10. The index hit a low of 6,316.40 in intraday trade. The index hit a high of 6,342.90 in intraday trade.
The market breadth, indicating the overall health of the market, turned negative from positive in early afternoon trade. On BSE, 1,227 shares fell and 1,082 shares rose. A total of 140 shares were unchanged.
Among the 30-share Sensex pack, 15 stocks fell and rest rose. ONGC (down 1.3%), TCS (down 1.05%) and Wipro (down 1.03%) edged lower from the Sensex pack.
Most bank pivotals gained. AXIS Bank (up 0.73%), HDFC Bank (up 0.01%) and State Bank of India (up 0.26%) gained.
ICICI Bank dropped 0.83%.
Bank of India declined 2.74% as the stock turned ex-dividend today, 23 January 2014 for the interim dividend of Rs 5 per share for the year ending 31 March 2014.
IDBI Bank shed 0.63% as the stock turned ex-dividend today, 23 January 2014 for the interim dividend of Rs 0.73 per share for the year ending 31 March 2014.
D B Realty rose 0.87%. The company during market hours denied media reports that it is in talks to sell its hospitality business to ITC for Rs 1300 crore.
Index heavyweight and cigarette maker ITC rose 0.15% to Rs 327.90. The stock hit high of Rs 328.85 and low of Rs 325.20 so far during the day.
Auto stocks were mixed. Maruti Suzuki India (up 0.32%) and Tata Motors (up 0.44%) gained. But, M&M declined 2.17%.
Ashok Leyland rose 2.61%, with the stock extending Wednesday's gains triggered by the company's optimism about Q4 March 2014 after reporting dismal Q3 December 2013 results on Tuesday, 21 January 2014. Ashok Leyland reported a net loss of Rs 167.20 crore in Q3 December 2013 compared with a net profit of Rs 74.14 crore in Q3 December 2012. Total income fell 18.67% to Rs 1968.62 crore in Q3 December 2013 over Q3 December 2012.
Ashok Leyland said that the company gained market share in the trucks business buoyed by the success of the ICV truck BOSS in every market where it has been launched. In line with the company's policy of ensuring fiscal prudence, the company is working to lower costs, reduce debt and divest non-core assets. There has been a significant reduction in operating costs and lowered working capital; including a VRS for about 500 executives, Ashok Leyland said in a statement. The company continues to invest in network expansion with over 600 customer touch points, including retail parts stores and containerized workshops, across the country, Ashok Leyland said.
Shares of most two wheeler companies declined. Hero MotoCorp (down 0.13%) and Bajaj Auto (down 0.93%) declined. TVS Motor Company rose 0.14%.
Mahindra & Mahindra Financial Services lost 3.84%, with the stock extending Wednesday's losses triggered by the company reporting weak Q3 result. The company announced weak Q3 result during trading hours on Wednesday, 22 January 2014. Mahindra & Mahindra Financial Services' consolidated net profit fell 15.7% to Rs 182.36 crore on 28.4% growth in total income to Rs 1363.21 crore in Q3 December 2013 over Q3 December 2012.
Bharti Infratel rose 1.48% after consolidated net profit jumped 62% to Rs 410.50 crore on 4% increase in revenue to Rs 2731 crore in Q3 December 2013 over Q3 December 2012. The Q3 result was announced during market hours. Consolidated operating free cash flow for the quarter was at Rs 708 crore, an increase of 30% over the corresponding period last year on account of higher operating income, Bharti Infratel said in a statement.
KPIT Technologies slumped 13.38% after consolidated net profit fell 8.93% to Rs 60.77 crore on 3.53% fall in net sales to Rs 677.93 crore in Q3 December 2013 over Q2 September 2013. The Q3 result was announced after market hours on Wednesday, 22 January 2014. KPIT Technologies' earnings before interest, taxation, depreciation and amortization (EBITDA) margins were 15.37% in Q3 December 2013 as compared to 15.49% in Q2 September 2013. The other income stood at Rs 1.75 crore in Q3 December 2013 as against Rs 2.31 crore in Q2 September 2013.
KPIT Technologies' revenue fell 2.3% to $109.66 million in Q3 December 2013 over Q2 September 2013. In constant currency terms, revenue was $336 million for year to date as on 31 December 2013 as against the reported $330.72 million.
In the foreign exchange market, the rupee edged lower against the dollar on global risk off sentiment. The partially convertible rupee was hovering at 61.9675, compared with its close of 61.815/825 on Wednesday, 22 January 2014.
Bond prices dropped for the second day in a row after a committee set up by the Reserve Bank of India in its report submitted to the central bank early this week recommended that the central bank should start using a consumer-price inflation target to determine monetary policy. The panel's recommendations if accepted by the central bank may result in increase in interest rates to achieve the panel's 4% consumer-price inflation target by 2016. The yield on 10-year benchmark federal paper, 8.83% GS 2023, was hovering at 8.6349%, higher than its close of 8.6085% on Wednesday, 22 January 2014. Bond yield and bond prices move in opposite direction.
The Reserve Bank of India's Third Quarter Review of Monetary Policy for 2013-14 is scheduled on 28 January 2014. The RBI kept its main lending rate viz. the repo rate unchanged after its last policy review in December and said at that time that it expected inflation to ease in the following months.
Assuring global investors that India is prepared to face the impact of the US Fed tapering, finance minister P Chidambaram on Wednesday said the country is poised to clock 5% growth in 2013-14 and over 6% in 2014-15. Addressing a meeting of the World Economic Forum (WEF), Chidambaram said the Indian economy has "stabilised and it is poised to return to high-growth path and step by step we will go back to 8% growth rate".
On the impact of the calibrated tapering of bond purchases by the US central bank, Chidambaram said: "We were concerned in May. But now I think we have done a lot of preparatory work. There will be some consequences in developing and emerging economies but I think we are better prepared for the taper than when we were surprised in May".
Asian stocks declined on Thursday, 23 January 2014, after a private gauge of China's manufacturing in January unexpectedly contracted. Key benchmark indices in Japan, South Korea, Singapore, China, Taiwan and Hong Kong were down 0.13% to 1.41%. Indonesia's Jakarta Composite rose 0.23%.
A preliminary reading of HSBC's January China manufacturing Purchase Manufacturing Index fell to 49.6, below the 50 boundary between expansion and contraction, and down from 50.5 in the final result for December. It was the first contraction for the sector in six months, according to the HSBC data.
South Korea's economic growth slowed as expected in the final quarter of last year on weaker construction spending, despite robust exports that reaffirms a recovery in Asia's fourth-largest economy. Gross domestic product rose a seasonally adjusted 0.9% in the October-December period from the previous quarter, when the economy expanded 1.1%, the Bank of Korea said on Thursday, 23 January 2014.
Trading in US index futures indicated that the Dow could drop 63 points at the opening bell on Thursday, 23 January 2014. US stocks closed mostly higher on Wednesday after trading in a narrow range for the bulk of the session. Markets shrugged off largely disappointing earnings, but results from IBM weighed on the blue chips.
The Federal Open Market Committee (FOMC) holds a two-day monetary policy meeting on 28 and 29 January 2014. By a 9-to-1 vote, the Fed on 18 December 2013 decided to trim its asset-purchase program by $10 billion to $75 billion per month starting in January 2014.
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