Friday 2 August 2013

Markets turn flat after firm opening, FinTech dn 40%

Markets have erased gains on account of profit booking after making a higher opening tracking firm global cues

Markets have erased gains on account of profit booking after making a higher opening tracking firm global cues. Moreover, Indian government has further relaxed foreign direct investment norms in the retail sector to attract overseas investments.

By 9:30, the Sensex was higher by 26 points at 19,344 points whereas the Nifty slipped by 2 points at 5,726 mark.

Japan's Nikkei share average rose to a one-week high on Friday morning, spurred by Wall Street's record-close overnight on strong US economic data and the commitment by major central banks to keep monetary stimulus in place. A stronger dollar versus the yen also buoyed sentiment, lifting exporters like auto makers and electronics manufactures.

The Nikkei jumped 1.9% to 14,266.31, after rising as high as 14,284.00, the highest level since July 26 and surpassed its 25-day moving average of 14,277.48.

The Dow and S&P 500 hit record closing highs on Thursday, with the S&P 500 topping 1,700 after strong data on factory growth and as major central banks said they would keep monetary stimulus in place.

Stocks were broadly higher, with all 10 S&P 500 sectors in the black. Growth-sensitive financials, industrials and consumer discretionary shares registered the biggest gains. The Dow transportation average rose 3.2%, also at a new closing high.

Meanwhile, the number of Americans filing new claims for unemployment benefits fell unexpectedly last week, touching a 5½ year low, suggesting a steadily improving labour market.

Back home, the government on Thursday approved the much-awaited relaxation of the foreign direct investment (FDI) policy on multi-brand retail trading (MBRT), by easing the three main contentious riders on such money.

These three, added as conditions to last year’s decision to open FDI in this segment, were on a mandatory 30% sourcing from small domestic industries, 50% of the investment to be in back-end infrastructure and outlets to be opened only in cities with population of more than a million.

On the sectoral front, BSE Consumer Durables index has surged by over 2% followed by counters like IT, FMCG and TECk, all gaining by nearly 1% each. However, BSE PSU index has declined by nearly 2% followed by counters like Realty, Power, Banks and Metal, all fal;ling by 1% each.

The main gainers on the Sensex are NTPC, ITC, TCS, RIL and Hero Moto whereas few losers are Coal India, DRL, GAIL, M&M and ICICI Bank.

M&M has decided to extend production holidays in the coming months too as retail demand hits new lows every day.

Hero MotoCorp reported marginal rise in total sales at 4,87,545 units for July this year.

Among other shares, Indian Oil Corporation (IOC) has opened lower by 3% at Rs 191 on BSE after the Cabinet Committee of Economic Affairs (CCEA) cleared the proposal for sale of 10% government stake in the state-owned oil marketing company.

Financial Tech has extended the losses and has dropped by over 30%. National Spot Exchange Ltd (NSEL), a group firm, suspended trading in all contracts except ‘e-series’ until further notice, shares of Financial Technologies (FT) and Multi-Commodity Exchange (MCX) on Thursday tanked on BSE.

The market breadth in BSE remains negative with 454 shares declining and 344 shares advancing.

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