Key benchmark indices edged lower in early trade tracking weakness in Asian stocks. The barometer index, the S&P BSE Sensex, was down 77.96 points or 0.37%, off close to 20 points from the day's high and up about 25 points from the day's low. The market breadth, indicating the overall health of the market, was negative. In the foreign exchange market, the rupee edged lower against the dollar in early deals.
Coal India dropped on reports the competition regulator has imposed a fine of Rs 1770 crore on state-run coal miner for abusing its dominant position and imposing unfair conditions in fuel supply agreements with customers. Shares of Bharti Airtel rose after Bharti and Reliance Industries' telecom unit, Reliance Jio Infocomm (Reliance Jio) on Tuesday, 10 December 2013 announced a comprehensive telecom infrastructure sharing arrangement under which they will share infrastructure created by both parties.
At 9:31 IST, the S&P BSE Sensex was down 77.96 points or 0.37% to 21,177.30. The index fell 102.59 points at the day's low of 21,152.67 in early trade. The index declined 54.75 points at the day's high of 21,200.51 in early trade.
The CNX Nifty was down 25.70 points or 0.41% to 6,307.15. The index hit a low of 6,299.05 in intraday trade. The index hit a high of 6,313.25 in intraday trade.
The market breadth, indicating the overall health of the market, was negative. On BSE, 460 shares fell and 325 shares rose. A total of 26 shares were unchanged.
From the 30-share Sensex pack, 21 stocks fell and rest rose. Tata Motors (down 1.72%), L&T (down 1.39%) and Bhel (down 1.09%) edged lower from the Sensex pack.
Power Grid Corporation of India was flat at Rs 98.30 The company said after market hours on Tuesday, 10 December 2013 that its board of directors has approved the issue price for follow-on public offer (FPO) at Rs 90 per share. A discount of Rs 4.50 per share has been allowed to retail investors and eligible employees on the issue price.The FPO of state-run Power Grid was subscribed 6.74 times. The FPO closed on 6 December 2013. The FPO received bids for a total 530.12 crore shares, compared with 78.70 crore shares on offer, as per NSE data.
Reliance Industries declined 0.4%. Shares of Bharti Airtel rose 0.76%. Bharti Airtel (Bharti) and Reliance Industries' telecom unit, Reliance Jio Infocomm (Reliance Jio) on Tuesday, 10 December 2013 announced a comprehensive telecom infrastructure sharing arrangement under which they will share infrastructure created by both parties. This will include optic fibre network - inter and intra city, submarine cable networks, towers and internet broadband services and other such opportunities identified in the future.
The cooperation is aimed at avoiding duplication of infrastructure, wherever possible, and to preserve capital and the environment. This will also provide redundancy in order to ensure seamless services to customers of the respective parties, Bharti and Reliance Jio said in a combined statement.
The arrangement could, in future, be extended to Roaming on 2G, 3G and 4G, and any other mutually benefiting areas relating to telecommunication, including but not limited to jointly laying optic fibre or other forms of infrastructure services. The pricing would be at 'arm's length', based on the prevailing market rates, the statement from both the companies said.
As part of this arrangement, Bharti and Reliance Jio have already announced an agreement under which Bharti has provided capacity on its i2i submarine cable to Reliance Jio.
Coal India dropped 2.49% on reports the competition regulator has imposed a fine of Rs 1770 crore on state-run coal miner for abusing its dominant position and imposing unfair conditions in fuel supply agreements with customers.
The Competition Commission of India (CCI) on Tuesday issued a cease and desist order to the state miner and directed it to modify clauses in its fuel supply contracts related to sampling and testing, transportation charges, and compensation on supply of stones, report said. The company, which accounts for 80% of India's coal output, changed its pricing system last year, allowing it to charge higher prices from some customers. However, it still sells domestic coal at discounts of between 45 and 70% to international prices. The CCI had launched a probe earlier this year after complaints from state utilities Maharashtra State Power Generation Co. and Gujarat State Electricity Corp against the miner and its units.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 61.33, compared with its close of 61.04 on Tuesday, 10 December 2013.
On macro front, the government will unveil industrial production data for October 2013 tomorrow, 12 December 2013. Index of industrial production (IIP) rose 2% in September 2013, showing increase in growth from 0.4% growth recorded in August 2013.
Data on inflation based on the general consumer price index (CPI) for November 2013 will also be unveiled tomorrow, 12 December 2013. The CPI inflation (combined) for October 2013 stood at 10.09% (y-o-y) higher than 9.84% (y-o-y) seen in September 2013.
The Reserve Bank of India (RBI) announces next Mid-Quarter Review of Monetary Policy for 2013-14 on 18 December 2013. The Third Quarter Review of Monetary Policy for 2013-14 is scheduled 28 January 2014.
The Asian Development Bank (ADB) on Wednesday kept its growth forecast for India at 4.7% for this year, and sees the country growing at 5.7% in 2014. The Manila-based bank slightly raised its forecast for China this year and the next, aided by the impact of government reforms and better prospects for key trading partners. The bank lifted its 2013 forecast for China to 7.7%, from 7.6% in October. It now sees 2014 growth at 7.5% rather than 7.4%. However, the ADB lowered estimates for Southeast Asia this year and in 2014, in the wake of a strong typhoon in the Philippines and political uncertainties in Thailand. The bank kept its growth forecast for developing Asia at 6% this year and 6.2% next year.
Asian stocks edged lower on Wednesday in cautious trading ahead of next week's Federal Reserve meeting. Key benchmark indices in Taiwan, South Korea, Singapore, China, Japan and Hong Kong were off 0.01% to 1.11%. Indonesia's Jakarta Composite rose 0.01%.
US stocks fell on Tuesday after the Standard & Poor's 500 Index reached a record, as investors weighed federal budget negotiations and better-than-estimated economic data to gauge the timing of any Federal Reserve stimulus cuts.
Data showed job openings in the US climbed to a five-year high in October, indicating employers were confident about demand even as Washington's budget impasse shuttered parts of the federal government. Another report showed wholesale trade sales and inventories increased more than economists forecast.
Investors are keeping a close watch on economic data in the United States as the Federal Reserve monitors the pace of recovery to gauge when it will begin to reduce monetary stimulus for the US economy, which has been aimed at encouraging growth. The Federal Open Market Committee (FOMC) holds a two-day policy meeting on interest rates in the United States on 17-18 December 2013. The US central bank currently buys bonds worth $85 billion a month in a bid to hold interest rates low and encourage economic growth in the world's biggest economy. Minutes of the Fed's October meeting released on 20 November 2013 showed officials may reduce their $85 billion a month of bond buying if the economy improves as anticipated.
The US budget deal, worked out between chief negotiators Senator Patty Murray and Representative Paul Ryan, would set spending at about $1.01 trillion in 2014, higher than the $967 billion required in a 2011 budget accord. The toughest part may be selling it to Congress, where skepticism is emerging in both political parties.
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