Key benchmark indices hit fresh intraday low in mid-morning trade. At 11:22 IST, the barometer index, the S&P BSE Sensex was down 320.61 points or 1.2% at 26,315.14. The losses for the Nifty 50 index were lower in percentage terms than those for the Sensex. The Nifty was currently down 86.90 points or 1.06% at 8,083.15. The Sensex hit 2-1/2 week low. The Nifty hit over two week low. Weakness in Asian stocks hit market sentiment adversely. Weak industrial production data for April 2016 released by the government after market hours on Friday, 10 June 2016 also weighed on the sentiment.
The Sensex lost 324.72 points or 1.21% at the day's low of 26,311.03 in mid-morning trade, its lowest level since 26 May 2016. The index dropped 167.48 points or 0.62% at the day's high of 26,468.27 in early trade. The Nifty lost 90.10 points or 1.1% at the day's low of 8,079.95 in mid-morning trade, its lowest level since 27 May 2016. The index fell 58.45 points or 0.71% at the day's high of 8,111.60 in early trade.
In overseas markets, Asian stocks were sharply lower ahead of central bank meetings in the US and Japan this week. In Hong Kong, the Hang Seng index was currently down 2.6%. In Japan, the Nikkei 225 index was currently down 3.18%. In mainland China, the Shanghai Composite index was currently down 0.98%. Data released today, 13 June 2016 showed that growth in China's fixed-asset investment and retail sales cooled unexpectedly in May, but factory output growth was steady, doing little to clear up uncertainty over prospects for the world's second-largest economy. US stocks declined on Friday, 10 June 2016 as nervousness over an impending vote that could see the UK leave the European Union, as well as a drop in oil prices, spurred a global selloff.
Closer home, the broad market depicted weakness. There were close to two losers against every gainer on BSE. On BSE, 1,427 shares declined and 719 shares rose. A total of 121 shares were unchanged. The BSE Mid-Cap index was currently down 0.83%. The BSE Small-Cap index was currently down 0.79%. The fall in both these indices was lower than the Sensex's decline in percentage terms.
Bank stocks fell across the board. Among private bank stocks, ICICI Bank (down 3.62%), Axis Bank (down 2.77%), HDFC Bank (down 0.4%), Kotak Mahindra Bank (down 0.35%) and IndusInd Bank (down 0.81%) declined.
Yes Bank shed 0.62%. The Reserve Bank of India (RBI) raised the ceiling on investment by foreign institutional investors (FIIs) to 74% of the private sector bank's paid up capital from earlier 60%. RBI's nod for higher ceiling on investment by FIIs came after Yes Bank's board of directors and shareholders approved the proposal. The RBI has capped the total foreign shareholding from all sources in Yes Bank at 74% of the bank's equity. Last month, the Cabinet Committee on Economic Affairs cleared Yes Bank's proposal for increase in foreign investment limit in the bank's equity capital to 74% from 41.87% without any sub-limits.
Among PSU bank stocks, State Bank of India (SBI) (down 2.23%), Alahabad Bank (down 3.1%), Punjab National Bank (down 2.08%), Bank of Baroda (down 2.36%), Canara Bank (down 1.91%), Bank of India (down 2.53%) and Union Bank of India (down 2.7%) dropped. IDBI Bank rose 0.75%.
Coal India rose 0.86% after the company said that two of its subsidiaries will buyback shares from their shareholders. Coal India announced on Sunday, 12 June 2016, that two of its subsidiaries - Mahanadi Coalfields and Northern Coalfields - will buyback total shares worth around Rs 1978 crore from their shareholders. The board of directors of Northern Coalfields (NGL) approved buyback of 4.01 lakh fully paid equity shares, or 22.62% equity, of face value of Rs 1000 each from the members of NGL on a proportionate basis through tender offer for an aggregate amount not exceeding Rs 948.72 crore. The shares will be purchased at Rs 23,610.04 each. The board of directors of Mahanadi Coalfields (MCL) approved buyback of 4.43 lakh fully paid equity shares, or 23.82% equity, of face value of Rs 1000 each from the members of MCL on a proportionate basis through tender offer for an aggregate amount not exceeding Rs 1028.77 crore. The shares will be purchased at Rs 23,171.89 each.
Aviation stocks fell after the civil aviation ministry proposed changes to Civil Aviation Requirements to be followed by aviation firms which could result in increase in costs for aviation firms.
SpiceJet (down 1.96%), Jet Airways (India) (down 2.14%) and InterGlobe Aviation (down 2.42%) declined.
The Ministry of Civil Aviation said in its proposed draft amendments to Civil Aviation Requirements (CARs) that airlines shall refund all statutory taxes and User Development Fee (UDF)/Airport Development Fee (ADF)/Passenger Service Fee (PSF) to the passengers in case of cancellation of tickets/non-utilisation of tickets/no show. In no circumstances, the cancellation charge shall be more than the basic fare. In case of denied boarding, flight cancellation and flight delays, the ministry has proposed that an amount equal to 200% of booked one way basic fair plus airline fuel charge subject to maximum of Rs 10,000 would be paid to passengers in case airline arranges alternate flight that is to depart after one hour but within 24 hours of the booked scheduled departure. The ministry has proposed that an airline shall refund an amount equal to 400% of booked one-way basic fare plus airline fuel charge subject to maximum of Rs 20,000 in case where the airline arranges alternate flight that is scheduled to depart beyond 24 hours of the booked scheduled departure. In case passenger does not opt for alternate flight, the airline shall refund full value of ticket and compensation equal to 400% of booked one-way basic fare plus airline fuel charge, subject to maximum of Rs 20,000.
The ministry announced the draft amendments to CAR on Saturday, 11 June 2016. The ministry has invited public comments on the proposed draft amendments to CARs by 27 June 2016.
With regard to checked-in baggage charges, the ministry has proposed that the airline should restrict additional baggage charge at Rs 100 per kg for baggage between 15 to 20 kg. Director General of Civil Aviation M Sathiyavathy was quoted as saying on Saturday, 11 June 2016, that the changes in excess baggage fee norms will be implemented from 15 June 2016.
On the macro front, data released after market hours on Friday, 10 June 2016 showed that India's industrial production (IIP) contracted by 0.8% in April 2016. Factory output measured in terms of the IIP had expanded by 3% in April 2015. The electricity generation surged at two-year high pace of 14.6%, while the mining output also moved up 1.4% in April 2016. However, the manufacturing sector production dipped 3.1% contributing to the decline in industrial output in April 2016. The IIP growth in March 2016 has been revised upwards to 0.3% in the first revision compared with 0.05% reported provisionally. Meanwhile, the growth in January 2016 has been revised downwards to -1.6% at the final revision from -1.5% at first revision and reported provisionally.
Meanwhile, the government is scheduled to unveil the consumer price index (CPI) data (rural, urban and combined) for the month of May 2016 at 17:30 IST today, 13 June 2016. The all-India General CPI inflation surged to 5.39% in April 2016 (new base 2012=100) from six months low of 4.8% recorded in March 2016.
Powered by Capital Market - Live News
