Key benchmark indices saw a gap-down opening on dismal global cues. At 9:30 IST, the barometer index, the S&P BSE Sensex, was down 244.99 points or 0.96% at 25,371.85. The 50-unit CNX Nifty was down 78.50 points or 1.01% at 7,717.20.
The market breadth indicating the overall health of the market was weak. On BSE, 968 shares declined and 318 shares rose. A total of 41 shares were unchanged. The BSE Mid-Cap index was off 0.93%. The BSE Small-Cap index was off 0.72%. The fall in both these indices was lower than the Sensex's decline in percentage terms.
In overseas markets, Asian stocks dropped to 3-1/2-year lows following sharp losses on Wall Street after weak Chinese data rekindled worries about its fragile economy. US stocks settled yesterday, 28 September 2015 at their lowest levels since late August as concerns about slowing economic growth in China and mixed domestic economic data unnerved investors.
The key domestic event for the day is the Reserve Bank of India's (RBI) fourth bi-monthly monetary policy review today, 29 September 2015. The RBI had kept its benchmark lending rate viz. the repo rate unchanged at 7.25% after a monetary policy review on 4 August 2015. RBI Governor Dr. Raghuram G. Rajan had at that time indicated in his written monetary policy statement that going ahead RBI will monitor developments for emerging room for further reduction in the policy rate. The RBI has cut the benchmark lending rate viz. the repo rate by 75 basis points since January 2015.
Vedanta (down 3.84%), Bharti Airtel (down 3.45%) and ICICI Bank (down 2.81%) were the top losers from the 30-share Sensex pack.
Larsen & Toubro (L&T) slipped 0.56%. L&T announced after market hours yesterday, 28 September 2015, that its subsidiary, Larsen & Toubro Infotech, filed its draft red herring prospectus with the Securities and Exchange Board of India (Sebi) on 28 September 2015 to undertake an initial public offering (IPO) of its equity shares. The issue comprises of an offer for sale of up to 1.75 crore equity shares of the face value Re 1 each by L&T.
In overseas markets, concern over a slowdown in China, the world's second-largest economy, and its potential impact on the US Federal Reserve's plans to normalize monetary policy after years of rock-bottom rates, has fueled market volatility in recent weeks. In China, data yesterday, 28 September 2015 showed industrial profits dropping the most in at least four years.
US economic data released yesterday, 28 September 2015 showed household spending climbed more than forecast in August and incomes also rose as the biggest part of the US economy continued to power past a global slowdown. Separate data showed contract signings to purchase previously owned US homes unexpectedly declined in August for just the second time this year, signaling residential real estate might have difficulty building on recent momentum.
Meanwhile, Federal Reserve Bank of New York President William C. Dudley reportedly said yesterday, 28 September 2015 the central bank will probably raise interest rates later this year despite uncertainties over global growth.
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