After a range bound movement earlier during the day, a sell-off gripped the bourses in afternoon trade. Banking and oil & gas stocks led decline as the 50-unit CNX Nifty fell below the psychological 8,000 mark. The Nifty hit its lowest level in more than 2-1/2 weeks. The barometer index, the S&P BSE Sensex, also hit its lowest level in more than 2-1/2 weeks. The Sensex was currently down 130.61 points or 0.49% at 26,685.95. Small-cap and mid-cap stocks witnessed a sudden reversal of gains. The market breadth indicating the overall health of the market turned negative from positive. The BSE Mid-Cap index was off 1.93%. The BSE Small-Cap index was off 2.16%. Meanwhile, the latest data showed that India's merchandise exports registered a small increase of 2.35% in August 2014. Asian and European stocks were in red.
Earlier, key indices hovered in a narrow range in red with small losses.
Asian and European stocks declined on caution ahead of the start of Federal Reserve's two-day policy meeting today, 16 September 2014.
In the foreign exchange market, the rupee edged higher against the dollar.
Brent crude oil prices edged lower in choppy trade before the weekly oil inventory data in the US, the world's biggest oil consumer.
At 13:18 IST, the S&P BSE Sensex was down 130.61 points or 0.49% at 26,685.95. The index dropped 163.37 points at the day's low of 26,653.19 in afternoon trade, its lowest level since 28 August 2014. The index rose 44.73 points at the day's high of 26,861.29 in early trade.
The CNX Nifty was down 47 points or 0.58% at 7,995. The index hit a low of 7,981.95 in intraday trade, its lowest level since 28 August 2014. The index hit a high of 8,044.90 in intraday trade.
The market breadth indicating the overall health of the market turned negative from positive in afternoon trade. 1,870 shares declined and 973 shares rose. A total of 89 shares were unchanged.
The BSE Mid-Cap index was down 193.35 points or 1.93% at 9,807.51. The BSE Small-Cap index was down 242.41 points or 2.16% at 11,003.11. Both these indices underperformed the Sensex.
The total turnover on BSE amounted to Rs 2728 crore by 13:20 IST.
Private and state-run oil and gas stocks declined. Among private sector, Reliance Industries (down 1.53%) and Cairn India (down 1.09%) declined.
PSU OMCs edged lower. HPCL (down 3.49%) and Indian Oil Corporation (IOCL) (down 4.27%) declined.
BPCL declined 2.74%. BPCL reportedly paid 141% higher advance tax at Rs 487 crore in Q2 September 2014 over Q2 September 2013.
Meanwhile, media reports said that the government will decide on ending government control on diesel pricing after elections in two states next month, even though local prices of the fuel are currently higher than the global rates, making a case for a cut in retail prices. PSU OMCs now have over recovery of 35 paise per litre on sale of diesel, as per the latest data released by Petroleum Planning & Analysis Cell.
PSU OMCs are currently incurring daily under-recovery of Rs 190 crore on the sale of Diesel, PDS Kerosene and Domestic LPG.
Shares of state-run upstream oil companies declined. Oil India fell 1.12%. GAIL (India) declined 1.24%
State-run upstream oil and gas companies share a part of the under recoveries of state-run oil marketing companies (PSU OMCs) by allowing discount in the prices of crude oil, PDS kerosene, and domestic LPG based on the rates of discount communicated by the Ministry of Petroleum and Natural Gas and the Petroleum Planning & Analysis Cell.
ONGC dropped 2.46%. The company said during market hours that ONGC Videsh (OVL) and PetroVietnam, the major oil producing state owned company of Vietnam, have signed a Letter of Intent (LOI) to participate in the exploration of oil & gas in the offshore Vietnam. ONGC Videsh is a wholly owned subsidiary of ONGC. The LOI provides for expansion of exploration activities by OVL in Vietnam by considering participation in 2-3 additional blocks subject to technical and commercial viability and requisite approvals. In turn, PetroVietnam may consider participation in some of the exploration blocks of OVL on mutually agreeable terms subject to due-diligence.
GMR Infrastructure lost 6.84%. GMR Infrastructure during market hours said that the company's board of directors at its meeting held today, 16 September 2014, has considered and approved, issue of equity shares by way of rights issue to the shareholders of the company for an amount upto Rs 1500 crore.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 61.06, compared with its close of 61.14 during the previous trading session.
Provisional data released by the stock exchanges after trading hours on Monday, 15 September 2014, showed that foreign portfolio investors (FPIs) sold shares worth a net Rs 74.59 crore on that day.
Brent crude oil prices edged lower in choppy trade before the weekly oil inventory data in the US, the world's biggest oil consumer. Brent for November settlement was off 18 cents at $97.70 a barrel. The contract had risen 0.84% to settle at $97.88 a barrel on Monday, 15 September 2014. The October contract which expired on Monday, 15 September 2014 dipped to a 26-month low at $96.21 in its final session.
On macro front, India's merchandise exports registered a small increase of 2.35% at $26.95 billion in August 2014 over August 2013, data released by the government after trading hours yesterday, 15 September 2014, showed. Imports rose 2.08% at $37.79 billion in August 2014 over August 2013. Oil imports declined 14.97% at $12.83 billion in August 2014 over August 2013. Non-oil imports jumped 13.82% at $24.95 billion in August 2014 over August 2013. The trade deficit increased to $10.83 billion in August 2014, from $10.68 billion in August 2013.
European stocks dropped in early trade today, 16 September 2014, as investors awaited the outcome of the latest Federal Reserve meeting. Key benchmark indices in UK, France and Germany were off 0.2% to 0.28%.
Meanwhile, investors are also waiting the 18 September 2014 referendum on Scottish independence.
Asian stocks declined today, 16 September 2014, on caution ahead of the start of Federal Reserve's two-day policy meeting today, 16 September 2014. Key benchmark indices in Hong Kong, Indonesia, Singapore, China, Taiwan and Japan were off 0.23% to 1.82%. South Korea's Kospi rose 0.35%.
Foreign direct investment into China, a gauge of external confidence, slumped to a four-year low amid widening antitrust probes into multinational companies. Inbound investment was $7.2 billion in August, down 14% from a year earlier, the Ministry of Commerce said on its website today in Beijing after a 17% drop in July. It was the first back-to-back decline of more than 10% since 2009.
Trading in US index futures indicated that the Dow could fall 19 points at the opening bell on Tuesday, 16 September 2014. US stocks closed mostly lower on Monday, 15 September 2014, with losses led by technology and small-cap stocks as investors continued to unload riskier position ahead of this week's pivotal Federal Reserve policy meeting.
Economic data yesterday showed US industrial production unexpectedly declined in August for the first time in seven months as automakers slowed assembly lines.
Investors will look to Federal Open Market Committee (FOMC) meeting for fresh guidance on US interest rates. A two-day policy meeting of the Federal Open Market Committee (FOMC) starts today, 16 September 2014. At the end of a two-day meeting, the FOMC is widely expected to announce cut in Fed's monthly bond-buying program by another $10 billion to $15 billion, staying on track to end the program at its October meeting. The Fed is likely to raise short-term interest rates next year from their current near-zero levels, where they have been since December 2008.
The Fed will also announce US economic projections after the policy meet. Fed now releases economic projections four times a year (March, June, September, and December). Traditionally, the Fed forecasts covered GDP, the PCE price index, and the civilian unemployment rate. However, the forecast report additionally now includes forecasts for the appropriate timing of the next change in the fed funds rate and the expected fed funds rate at the end of the next two years. The policy meet will be followed by a press conference by Federal Reserve Chairwoman Janet Yellen on 17 September 2014.
The Federal Reserve after two-day policy meeting on 30 July 2014, said it would reduce its purchases of mortgage and Treasury bonds by $10 billion to $25 billion monthly from $35 billion earlier, as widely expected.
Powered by Capital Market - Live News
