Thursday 12 December 2013

Sensex, Nifty Fed up of gains!

Finally, BSE Sensex closed at 20,925 down 245 points over the previous close, while NSE Nifty closed at 6,237 down 70 points over the previous close.

The stock market in India extended its decline for the third consecutive trading session . Nifty creating a new high on Monday appears to be a distant memory as indices continue to struggle on  heightened expectations that the Fed may act sooner than later to unwind its stimulus after a provisional budget deal in Washington eased some of the fiscal drag on the US economy.

Weakness across the global markets weighed heavily on Dalal Street. MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.6%, its sharpest one-day fall in three weeks. On one hand there are expectations that the Fed may act to unwind its stimulus while on the other the belief is it will happen after the new Fed chief takes charge.

Back home, Indices appeared to be edgy ahead of the announcement of the October IIP data and November CPI data later today.

Finally, BSE Sensex closed at 20,925  down 245  points over the previous close, while NSE Nifty closed at 6,237 down 70 points over the previous close.

Today’s decline was so fierce that majority of the BSE sectoral Indices ended in the red, with the BSE Auto index the top loser, the index was down 2.2% followed by BSE Banking and Capital goods index down 1.4% and 1% respectively. Even the Mid-Cap and the Small-Cap indices closed in red.

Tata Power, HDFC and JP Associates were among gainers in the Nifty.

Tata Motors, ICICI Bank, Axis Bank, Bharti Airtel and RIL were among losers in the Nifty.

Meanwhile, Tata Motors extended its recent decline by ~5% to close at Rs360. Commenting on the same, Amar Ambani, Head of Research at IIFL said, “Tata Motors has seen a marked correction over the past couple of days as JLR, which has been the driving force for its profitability in recent times, has announced increase in capex estimate for FY15 from £2.75bn earlier to £3.5-3.5bn. Consequently, as against earlier estimates, the company will report negative free cash flow in FY15. While in the longer term, this would be positive given that 40% of the investment would be towards R&D leading to development of new and efficient models, in the near term it could increase stress on consolidated balance sheet.”

The advance-decline ratio was in favour of the bears. On the BSE, 1041 stocks advanced against 1427  declining stocks, while 174 remained unchanged.

The INDIA VIX was up 1% at 17.80 It hit a day’s high of 17.93 and low of 17.03.

Stocks which hit a 52-week high during the week were Accel Front,Arex Inds, Best Eastern Hot while ACCLAIM IND, Advance Lifestyles, Amit Spinning hit a  52-week low during  the week.

Stock News

Shares of Tata Motors slipped nearly 3% after its UK subsidiary Jaguar Land Rover (JLR) expanded its capex guidance for the fiscal year ending March 2015 which is likely to strain the company's cash flows in near term.

Shares of SKS Microfinance was up 3% at Rs 176 after the company announced that it has completed a second securitisation deal worth Rs 80.81 crore for the current fiscal.

Shares of Just Dial Ltd gained 2.2% after index compiler FTSE says it will include the stock in its FTSE AllCap index, effective from the start of trading on December 23.

Shares of Lanco Infratech was flat at Rs7;  reports stated that a consortium of 27 banks has agreed for restructuring of loans. 

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