Markets Today
- Markets finished the session on a dismal note with Sensex closing at its lowest level since August 2014 as weak GDP data coupled with worries over China's economic slowdown and fears of an interest rate hike by the US fed triggered a fresh round of selling across the bourses.
The Sensex closed 243 points lower at 25,454 and the Nifty dropped 69 points lower at 7,717.
- Among the 12 BSE sectoral indices, 4 indices closed in positive while 8 indices closed in negative. Top Gainers: BSE IT up by 1.24% and BSE Teck by 0.97%. Top Losers: BSE Power down by 2.43% and BSE Bankex by 1.81%.
Market breadth was negative at ~0.88 as investors sold large cap stocks. On provisional basis, FII's sold Rs 15.73bn worth of Indian equities while DII's bought Rs 8.80bn worth of Indian equities.
Economic and Corporate Developments
- The government today flagged deflation as a new challenge for the economy but expressed hope that the growth will be close to 8% in the current fiscal year, notwithstanding lower first quarter GDP number. "Overall, economic growth is moving in the right direction, although its pace is still below what the economy needs. But at a pace that is expected to pick up in response to the ongoing reforms, Chief Economic Advisor Arvind Subramanian said.
- The Cabinet today approved auction of 69 small and marginal oil fields of state-owned ONGC and Oil India to private and foreign firms as a precursor to a fully fledged licensing round. The Cabinet Committee on Economic Affairs (CCEA), headed by Prime Minister Narendra Modi, today approved auctioning of the fields that state-owned firms are surrendering because they were uneconomical to develop due to government's subsidy sharing mechanism.
The fields will be bid out on the basis of revenue share or the share of oil and gas a bidder offers to the government upfront, and work programme, an official said. Companies offering the maximum revenue share or percentage of oil and gas to the government, and committing to do more work, will win the field.
- Fitch Ratings today said that RBI declaring only ICICI Bank and SBI as Domestic Systemically Important Banks (DSIBs) reflects in part some of the broader capital challenges in India. Fitch expects more banks to be designated DSIBs in future.
- The Reserve Bank of India's (RBI) plan to include buybacks and switches as a part of the regular calendar of issuances of government securities is not expected to have any disruption in the bond market.
The central bank said in its annual report released last week that buybacks and switches in government securities are planned to be included as a part of the regular calendar of issuances from the second half of the current financial year. RBI is also planning to issue 40-year government bonds in a bid to cater to the demand from long term investors like insurance companies and pension funds.
Buzzing Stocks
- Tata Steel closed 1.60% up at Rs 219.65 on BSE on bargain hunting after the stock fell 5.38% in the preceding two trading sessions to Rs 216.20 on 1 September 2015, from a recent high of Rs 228.50 on 28 August 2015.
- Glenmark Pharmaceuticals closed 4.04% down at Rs 1,079.25 on BSE on reports a foreign brokerage maintained its underperform rating on the stock.
- MMTC (up 3.84% at Rs 41.90) and State Trading Corporation (up 1.01% at Rs 160.40) closed up on BSE after the Union Cabinet approved the proposal to reimburse certain state-run companies for incurring losses on pulses imported between 2006-2011.
- DLF closed 3.40% up at Rs 109.60 on BSE after the Singapore government's sovereign wealth fund GIC announced its decision to invest about Rs 1990 crore in two upcoming real estate development projects of a wholly-owned subsidiary of DLF.
- Seven IT shares closed on BSE as Indian rupee declined against the dollar. Tech Mahindra (up 4.54%), CMC (up 2.42%), TCS (up 2.45%), Hexaware Technologies (up 4.61%), MindTree (up 0.74%), Infosys (up 0.98%) and hCl Technologies (up 0.26%) edged higher.
- Alphageo (India) closed 5.88% up at Rs 414.10 on BSE after the company said it won a contract worth $3 million in Myanmar.
- Info Edge (India) closed 0.97% up at Rs 753.05 on BSE after the central bank allowed foreign investors to buy up to 50% stake in the company.
- Tata Motors closed 1.29% down at Rs 325.35 on BSE after total sales fell 0.5% to 40,680 units in August 2015 over August 2014.
- Bajaj Auto closed 1.97% down at Rs 2,207.35 Rs 2,239 on BSE after the company said its total sales rose 2% to 3.41 lakh units in August 2015 over August 2014.
- Hero MotoCorp closed 1.97% down at Rs 2,207.35 on BSE after the company reported 13.98% decline in its two-wheeler sales to 4.80 lakh units in August 2015 over August 2014.
- FMCG major ITC which slumped in the recent past closed 1.41% up at Rs 320 on BSE on renewed buying interest.
- Mahindra & Mahindra closed 3.56% down at Rs 1,134.95 on BSE after the company said that its total tractor sales declined 22% to 11,699 units in August 2015 over August 2014.
Contributed by Keynote Capitals
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