The eight back to back sessions of horrendous
performance finally came to a halt, two days ahead of the November
series futures and options expiry as hefty covering of short positions
helped Indian benchmarks to regain the important psychological 16,000
(Sensex) and 4,800 (Nifty) bastions. A relief rally was long due for the
markets however, Tuesday's gains for benchmark indices was merely a
glimpse of a pullback rally considering the fact that the key gauges
have lost over a massive nine percentage points in the eight session
downtrend. Nonetheless, the bourses showed some fervor in the session
and garnered around three fourth of a percent as market participants
hunted for badly beaten down but fundamentally strong bargains. But the
gains in the domestic markets were limited by the sustained depreciation
in rupee which slipped to lifetime lows against the US dollar, making
it the worst performing currency in Asia. The first day of winter
session of parliament failed to give any supportive cues to the markets
as both Rajya Sabha and Lok Sabha got adjourned for the day on the back
of uproar over various issues, including Telangana, price rise and
corruption. However, sentiments took some support from the FDI data
which showed that FDI in India surged by 74% to $19.13 billion in the
first half of current financial year compared to $8.6 billion in the
same period of the last year, despite the ongoing debt crisis in
European economies and slowdown in US. On the global front, the Asian
markets settled on a mixed note while most European indices traded in
the green terrain as investors' nervousness got pacified from reports
that the two major ratings agencies S&P's and Moody's, have
reaffirmed US credit rating stating that the deficit committee's failure
would not trigger an immediate downgrade.
Earlier on Dalal Street, the benchmark got off to an optimistic opening, in tandem with largely positive sentiments prevailing in Asian markets. Though the indices soon slipped to the lowest levels in the session, however, hefty short covering in software and technology counters lent support to the indices. Thereafter, the bourses capitalized on the momentum and treaded on a northbound journey and even touched the high point of the day in mid noon trades. But just when it looked like the bourses will snap the eight day mayhem with strong gains, investors started to take profits off the table and brought the key gauges to the lower levels just before the end of trade. Eventually, the NSE's 50-share broadly followed index Nifty, climbed over half a percent to settle above the crucial 4,800 support level while Bombay Stock Exchange's Sensitive Index Sensex garnered over a hundred points and closed above the psychological 16,050 mark. Moreover, the broader markets failed to match the fervor that their larger peers showed and settled with marginal gains. On the BSE sectoral space, the hefty short covering was evident in Information Technology index which remained the top gainer in the space with about two percent gains. The Metal and rate sensitive Auto pockets too went home with gains of over a percent. On the other hand, the Consumer Durable counter got pummeled by over three percent, while the defensive - FMCG and Power sectors too settled in the red terrain. The markets climbed on large volumes of around Rs 2 lakh crore while the turnover for NSE F&O segment too remained on the higher side as compared to Monday at over 1.86 lakh core as it was the second day of F&O expiry week. However, the market breadth remained pessimistic as there were 1350 shares on the gaining side against 1406 shares on the losing side while 133 shares remained unchanged.
Finally, the BSE Sensex gained 119.32 points or 0.75% to settle at 16,065.42, while the S&P CNX Nifty rose by 34.00 points or 0.71% to close 4,812.35.
The BSE Sensex touched a high and a low of 16,212.95 and 15,970.11 respectively. The BSE Mid cap and Small cap index up by 0.34% and 0.03% respectively.
The major gainers on the Sensex were Tata Motors up 6.91%, Jaiprakash Associate up 4.28%, Tata Steel up 2.77%, DLF up 2.58% and Infosys up 2.33%. While, Bharti Airtel down 2.48%, Tata Power down 2.29%, ITC down 1.61%, Bajaj Auto down 1.42% and HUL down 1.33% were the major losers on the index.
The major gainers on the BSE sectoral space were IT up 1.95%, Metal up 1.54%, Auto up 1.08%, TECk up 1.06%, Health Care (HC) up 0.98%. While Consumer Durables (CD) down 3.16%, FMCG down 1.36% and Power down 0.27% were the major losers on the BSE sectoral space.
Meanwhile, stating the sharp decline of Indian rupee against American dollar as 'disruptive', the Reserve Bank of India (RBI) Deputy Governor Subir Gokarn said any action to arrest the fall will be guided by medium-term considerations. The rupee plunged to nearly 33-month low level of Rs 52.73 against the US currency on sustained dollar demand amid weak trends in stock markets and deepening euro-debt crisis.
This historical decline is due to persistent demand for US dollar from banks and importers such as oil refiners to meet month-end requirements amid expectation of a further increase in dollar value overseas because of the ongoing debt crisis in euro-zone.
'We don't really have a target or a rate in mind. It's moving as per market dynamics. It (fall in the value of the rupee) is disruptive, there is no question. There (will be) impact on our import bill, particularly for energy. It's having an impact on companies and it is a problem,' Gokarn said.
On market intervention by the RBI to control decline in rupee, Gokarn said, 'any action we take now (will) have to take into account the fact that these actions might have consequences a little further down the road. So we have got to balance out actions with risks or a potential increase in vulnerability later on.' By adding further he said, 'actions have to be weighed in terms of their medium-term risks'.
The sharp decline in rupee is expected to push inflation rate, which is already hovering nearby two digit mark from several months. Gokarn said that 'we should not be looking at only the short-term when we make these judgements. Every action that has been suggested... that has been debated also has potentially adverse consequences down the road. So we have got to balance out those too. '
Though the RBI has been maintaining that the exchange rate should be market determined, but the volatility in rupee has raised its concern. On this Gokarn said, 'volatility is another thing. This is the sharpness and speed of the movement that is obviously creating some disruptions. We don't know where it is going to go, but it is something we need to watch out for.'
Earlier finance minister on the role of RBI controlling the volatility said that 'the central bank would have been helpful if the fall was due to domestic factors. However, he expects that there will be a self correction in market.
The top gainers on the Nifty were Tata Motors up 7.40%, JP Associate up 4.77%, BPCL up 3.70%, Tata Steel up 3.50% and Cairn up 3.28%. On the flip side, Siemens down 2.80%, Bharti Airtel down 2.39%, Kotak Bank down 2.09%, Tata Power down 2.08% and ITC down 1.91% were the top losers on the index.
The European markets were trading in green. France's CAC 40 up 0.81%, Britain's FTSE 100 up by 0.43%, and Germany's DAX up by 0.95%.
After witnessing steep sell-off in previous five sessions, Asian equity indices bounced back with Jakarta Composite and Straits Times garnering decent gains as investors went for fresh position in fundamentally strong stocks after the recent slaughter. However, the Asian markets were in red for most part of the day on growing worries over France's credit rating and after a US committee responsible for finding a deal to cut the nation's huge deficit said it had failed.
Meanwhile, Hong Kong shares edged higher in the trade supported by buying in some globally exposed companies, with ports operator Cosco Pacific up 1.8%, Li & Fung gaining 3.4%, and Tsingtao Brewery rising 1.6%. In Seoul, Hyundai Motor rose 0.9%, while tech heavyweights Samsung Electronics and Hynix Semiconductor gained 1.4% and 1.5%, respectively, pulled index in green territory.
Earlier on Dalal Street, the benchmark got off to an optimistic opening, in tandem with largely positive sentiments prevailing in Asian markets. Though the indices soon slipped to the lowest levels in the session, however, hefty short covering in software and technology counters lent support to the indices. Thereafter, the bourses capitalized on the momentum and treaded on a northbound journey and even touched the high point of the day in mid noon trades. But just when it looked like the bourses will snap the eight day mayhem with strong gains, investors started to take profits off the table and brought the key gauges to the lower levels just before the end of trade. Eventually, the NSE's 50-share broadly followed index Nifty, climbed over half a percent to settle above the crucial 4,800 support level while Bombay Stock Exchange's Sensitive Index Sensex garnered over a hundred points and closed above the psychological 16,050 mark. Moreover, the broader markets failed to match the fervor that their larger peers showed and settled with marginal gains. On the BSE sectoral space, the hefty short covering was evident in Information Technology index which remained the top gainer in the space with about two percent gains. The Metal and rate sensitive Auto pockets too went home with gains of over a percent. On the other hand, the Consumer Durable counter got pummeled by over three percent, while the defensive - FMCG and Power sectors too settled in the red terrain. The markets climbed on large volumes of around Rs 2 lakh crore while the turnover for NSE F&O segment too remained on the higher side as compared to Monday at over 1.86 lakh core as it was the second day of F&O expiry week. However, the market breadth remained pessimistic as there were 1350 shares on the gaining side against 1406 shares on the losing side while 133 shares remained unchanged.
Finally, the BSE Sensex gained 119.32 points or 0.75% to settle at 16,065.42, while the S&P CNX Nifty rose by 34.00 points or 0.71% to close 4,812.35.
The BSE Sensex touched a high and a low of 16,212.95 and 15,970.11 respectively. The BSE Mid cap and Small cap index up by 0.34% and 0.03% respectively.
The major gainers on the Sensex were Tata Motors up 6.91%, Jaiprakash Associate up 4.28%, Tata Steel up 2.77%, DLF up 2.58% and Infosys up 2.33%. While, Bharti Airtel down 2.48%, Tata Power down 2.29%, ITC down 1.61%, Bajaj Auto down 1.42% and HUL down 1.33% were the major losers on the index.
The major gainers on the BSE sectoral space were IT up 1.95%, Metal up 1.54%, Auto up 1.08%, TECk up 1.06%, Health Care (HC) up 0.98%. While Consumer Durables (CD) down 3.16%, FMCG down 1.36% and Power down 0.27% were the major losers on the BSE sectoral space.
Meanwhile, stating the sharp decline of Indian rupee against American dollar as 'disruptive', the Reserve Bank of India (RBI) Deputy Governor Subir Gokarn said any action to arrest the fall will be guided by medium-term considerations. The rupee plunged to nearly 33-month low level of Rs 52.73 against the US currency on sustained dollar demand amid weak trends in stock markets and deepening euro-debt crisis.
This historical decline is due to persistent demand for US dollar from banks and importers such as oil refiners to meet month-end requirements amid expectation of a further increase in dollar value overseas because of the ongoing debt crisis in euro-zone.
'We don't really have a target or a rate in mind. It's moving as per market dynamics. It (fall in the value of the rupee) is disruptive, there is no question. There (will be) impact on our import bill, particularly for energy. It's having an impact on companies and it is a problem,' Gokarn said.
On market intervention by the RBI to control decline in rupee, Gokarn said, 'any action we take now (will) have to take into account the fact that these actions might have consequences a little further down the road. So we have got to balance out actions with risks or a potential increase in vulnerability later on.' By adding further he said, 'actions have to be weighed in terms of their medium-term risks'.
The sharp decline in rupee is expected to push inflation rate, which is already hovering nearby two digit mark from several months. Gokarn said that 'we should not be looking at only the short-term when we make these judgements. Every action that has been suggested... that has been debated also has potentially adverse consequences down the road. So we have got to balance out those too. '
Though the RBI has been maintaining that the exchange rate should be market determined, but the volatility in rupee has raised its concern. On this Gokarn said, 'volatility is another thing. This is the sharpness and speed of the movement that is obviously creating some disruptions. We don't know where it is going to go, but it is something we need to watch out for.'
Earlier finance minister on the role of RBI controlling the volatility said that 'the central bank would have been helpful if the fall was due to domestic factors. However, he expects that there will be a self correction in market.
The
rupee had dropped past 52 a dollar, closing at a record low of 52.15,
on strong dollar demand from importers amid worries that foreign
investors may flee riskier assets and markets due to the global economic
instability. The previous all-time closing low of the currency was
51.97 registered on March 3, 2009. The rupee is now among the top three
worst performing currencies globally and has fallen by a whopping 15 per
cent since July this year. It is the worst performing currency in
Asia, falling 14 per cent through the year.
The S&P CNX Nifty touched a high and low of 4,854.00 and 4,782.55 respectively. The top gainers on the Nifty were Tata Motors up 7.40%, JP Associate up 4.77%, BPCL up 3.70%, Tata Steel up 3.50% and Cairn up 3.28%. On the flip side, Siemens down 2.80%, Bharti Airtel down 2.39%, Kotak Bank down 2.09%, Tata Power down 2.08% and ITC down 1.91% were the top losers on the index.
The European markets were trading in green. France's CAC 40 up 0.81%, Britain's FTSE 100 up by 0.43%, and Germany's DAX up by 0.95%.
After witnessing steep sell-off in previous five sessions, Asian equity indices bounced back with Jakarta Composite and Straits Times garnering decent gains as investors went for fresh position in fundamentally strong stocks after the recent slaughter. However, the Asian markets were in red for most part of the day on growing worries over France's credit rating and after a US committee responsible for finding a deal to cut the nation's huge deficit said it had failed.
Meanwhile, Hong Kong shares edged higher in the trade supported by buying in some globally exposed companies, with ports operator Cosco Pacific up 1.8%, Li & Fung gaining 3.4%, and Tsingtao Brewery rising 1.6%. In Seoul, Hyundai Motor rose 0.9%, while tech heavyweights Samsung Electronics and Hynix Semiconductor gained 1.4% and 1.5%, respectively, pulled index in green territory.
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