A bout of volatility was witnessed as key benchmark indices pared gains after a sudden slide in mid-afternoon trade. At 14:15 IST, the barometer index, the S&P BSE Sensex, was up 50.71 points or 0.2% at 25,095.14. The 50-unit Nifty 50 index was currently up 20.75 points or 0.27% at 7,631.20. The Sensex retained the psychologically important 25,000 mark. Earlier, the barometer index had fallen below that level when it opened with a downward gap. The Sensex rose 149.72 points or 0.59% at the day's high of 25,194.15 in mid-afternoon trade. The barometer index fell 176.70 points or 0.7% at the day's low of 24,867.73 in early trade, its lowest level since 8 September 2015. The Nifty rose 53.50 points or 0.7% at the day's high of 7,663.95 in afternoon trade. The index fell 59.40 points or 0.78% at the day's low of 7,551.05 in early trade, its lowest level since 8 September 2015.
In overseas stock markets, European stock markets edged higher in cautious trade as investors look ahead to this week's pivotal US monetary policy meeting. Asian equities edged lower amid sharpening worries about the stability of the junk-bond market and tumbling oil prices. Lower commodity prices have stirred up concerns that oil and gas companies won't be able to pay back all their debt. Investors were also cautious before the highly anticipated US Federal Reserve policy meeting this week, when officials are widely expected to raise interest rates for the first time in almost a decade from ultralow levels. Increase in interest rates in the United States is expected to draw investors back into the US and away from riskier assets, including in emerging markets and Asia. The Fed is widely expected to raise the federal funds rate by 25 basis points after the conclusion of a two-day monetary policy meeting on 15-16 December 2015. With markets having already priced in a 25 basis points rate hike in mid-December, the focus has shifted to the likely pace and quantum of rate hikes once this first move is done.
US stocks tumbled during the previous trading session on Friday, 11 December 2015, as falling prices in crude oil and worries about junk-bond markets rattled Wall Street. News during the previous day on 10 December 2015 that high-yield mutual fund Third Avenue Focused Credit Fund is blocking investors from withdrawing their money, added to market jitters.
Closer home, the market breadth indicating the overall health of the market was positive. On BSE, 1,441 shares rose and 1,061 shares fell. A total of 196 shares were unchanged. The BSE Mid-Cap index was currently up 0.54%. The BSE Small-Cap index was currently up 0.37%. Both these indices outperformed the Sensex.
Adani Ports and Special Economic Zone was up 4.69% to Rs 252.40. The stock hit a high of Rs 252.80 and a low of Rs 239.65 so far during the day.
Infosys rose 1.9% to Rs 1,072.35 after the company said that it has made an investment of $3 million in WHOOP Inc., an early stage company in the US offering a performance optimization system for elite professional sports teams. The stock hit a high of Rs 1,073.30 and a low of Rs 1,049 so far during the day. Infosys said that the investment in WHOOP Inc. will be completed by 16 December 2015. Infosys will have a minority holding in WHOOP, not exceeding 20% of its outstanding share capital. WHOOP's system includes a device worn by athletes on their wrist that continuously measures key strain and recovery variables, and actionable analytics powered by proprietary algorithms that generate intensity and recovery scores. This enables athletes and coaches to gain visibility into the drivers of high performance, guide training and make optimal game day decisions.
Cement stocks rose after the Competition Appellate Tribunal (COMPAT) on Friday, 11 December 2015, quashed the penalty of Rs 6316 crore imposed on 11 cement firms by the Competition Commission of India (CCI) on charges of cartelisation and other unfair trade practices. ACC (up 1.87%), Ambuja Cements (up 1.80%) and UltraTech Cement (up 2.07%) edged higher.
Grasim Industries was up 1.56%. Grasim has exposure to cement sector through its holding in UltraTech Cement.
COMPAT also directed the CCI to refund the 10% of the penalty amount the companies had to deposit with the fair trade regulator. The judgement follows appeals filed by the cement firms and the industry body Cement Manufacturers Association. The companies include ACC, Ambuja Cements, Binani Cements, Century Textiles, India Cements, JK Cements, Lafarge India, Madras Cements, UltraTech Cement and Jaiprakash Associates. The commission had passed the order after an investigation into complaints from the Builders Association of India against alleged price cartelisation among cement firms. ACC will be refunded Rs 114.75 crore, Ambuja Cements Rs 116.39 crore and UltraTech Cement will be refunded Rs 117.54 crore.
Meanwhile, the tribunal has directed CCI to hear the case again and pass a fresh order within three months.
Realty shares were mixed. Parsvnath Developers (up 2.16%), Oberoi Realty (up 1.78%), Anant Raj (up 1.28%), Mahindra Lifespace Developers (up 1%), D B Realty (up 0.87%), Phoenix Mills (up 0.71%), Peninsula Land (up 0.67%), Indiabulls Real Estate (up 0.36%) and Sunteck Realty (up 0.35%), edged higher. Sobha (down 0.02%), DLF (down 0.18%), Godrej Properties (down 0.23%), Housing Development and Infrastructure (HDIL) (down 0.24%), Prestige Estates Projects (down 0.38%) and Unitech (down 0.48%), edged lower.
On the macro front, the latest data showed that inflation based on the wholesale price index (WPI) remained in negative zone in November 2015. WPI stood at negative 1.99% in November 2015 compared to a reading of negative 3.81% for October 2015.
Meanwhile, India's Index of Industrial Production (IIP) growth surged to 60-months high of 9.8% in October 2015 over a year ago compared with the revised growth of 3.8% in September 2015. An extremely farvourable base effect with IIP declining 2.7% in October 2014 has mainly fuel the IIP growth for October 2015. Also, the festive season shifting to November this year compared with October in last year, aided IIP growth in October 2015 driven by pre-festive season surge in production. The data was announced by the government after market hours on Friday, 11 December 2015.
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