Volatility ruled the roost as key benchmark indices pared losses soon after extending intraday slide in afternoon trade. At 14:20 IST, the barometer index, the S&P BSE Sensex, was off 186.91 points or 0.72% at 25,934.49. The losses for Nifty 50 index were higher in percentage terms than those for the Sensex. The Nifty was currently off 73.50 points or 0.93% at 7,841.70. The Sensex continued to hover below the psychological 26,000 level after falling below that mark in early trade.
The Sensex declined 289.86 points or 1.1% at the day's low of 25,831.54 in afternoon trade. The index lost 27.31 points or 0.1% at the day's high of 26,094.09 in the opening trade. The Nifty lost 101.55 points or 1.28% at the day's low of 7,813.65 in afternoon trade. The index lost 30.10 points or 0.38% at the day's high of 7,885.10 at the onset of the trading session.
In overseas stock markets, European stocks edged higher. Asian stocks edged lower amid strengthening prospects for higher US interest rates as soon as December and the latest signal of China's weakening economy. The latest data showed that China's consumer price index rose 1.3% in October from a year earlier, slower than a 1.6% rise in September. The reading, on the heels of weak export data over the weekend, is the latest indication of China's slowdown and flagging domestic demand.
Meanwhile, stronger-than-expected US employment report for October 2015 has increased the odds of a Federal Reserve rate increase in December. The Fed-funds futures market is now pricing in 68% probability of an increase in US benchmark interest rate in December 2015. Investors in emerging markets, including India are worried that once the Fed starts raising interest rates, it will drain liquidity from global emerging markets and redirect it to developed economies. The Fed has held its benchmark short-term interest rate near zero since December 2008. The ultra-loose monetary policy in the US has encouraged heavy investment in higher-yielding emerging markets. The next monetary policy review from the Fed is scheduled on 15-16 December 2015.
Closer home, the market breadth indicating the overall health of the market was negative. On BSE, 1,407 shares declined and 1,079 shares rose. A total of 105 shares were unchanged. The BSE Mid-Cap index was currently off 0.93%. The decline in this index was higher than the Sensex's decline in percentage terms. The BSE Small-Cap index was currently off 0.18%. The decline in this index was lower than Sensex's decline in percentage terms.
Cement stocks declined. Ambuja Cements (down 3%), ACC (down 1.68%) and UltraTech Cement (down 1.37%) edged lower. Shree Cement (up 0.2%) edged higher.
Grasim Industries was off 0.58%. Grasim has exposure to cement sector through its holding in UltraTech Cement.
FMCG stocks were mixed. Tata Global Beverages (down 1.44%), Procter & Gamble Hygiene and Health Care (down 2.02%), Jyothy Laboratories (down 1.24%), Nestle India (down 0.45%), Dabur India (down 0.62%) and Godrej Consumer Products (down 0.15%) edged lower. Bajaj Corp (up 0.05%), Marico (up 0.3%), Britannia Industries (up 0.67%), Hindustan Unilever (up 0.77%), GlaxoSmithkline Consumer Healthcare (up 0.22%) and Colgate Palmolive (India) (up 0.13%) edged higher.
Dr Reddy's Laboratories declined after the company's management reportedly revealed in a conference call yesterday, 9 November 2015 that the US Food and Drug Administration (USFDA) has ordered a third-party audit across the manufacturing network of the company. The stock was off 3.84% at Rs 3,370. The stock hit a high of Rs 3,494.90 and a low of Rs 3,324.70 so far during the day. The conference call was held in the wake of a warning from the USFDA on possible violations of manufacturing standards at three pharmaceutical plants of the company. Reacting to this development, shares of Dr Reddy's Laboratories had slumped 17.58% in the preceding two trading sessions to settle at Rs 3,504.60 yesterday, 9 November 2015, from Rs 4,252.60 on 5 November 2015.
Financial Technologies (India) (FTIL) surged 4.88% at Rs 103.10 after the company said it entered into two different agreements for sale of additional 3.63% stake in Indian Energy Exchange (IEX) for about Rs 100 crore. FTIL said it has entered into an agreement with SG BRIC III Trading, LLC for selling 1.61% stake sale in IEX for Rs 34.64 crore and with Singuler Guff NJDM Investment Holdings for selling 3.02% stake in IEX for Rs 64.99 crore. With conclusion of these transactions, FTIL will have only 0.37% stake in IEX. The announcement was made after trading hours yesterday, 9 November 2015.
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