Benchmark equity indices repulsed to budge from
day's low point after weak Chinese manufacturing survey renewed fears of
a hard landing for the world's No. 2 economy, thereby exacerbating
worries about faltering global growth following a downward revision of
U.S. GDP data. Selling pressure, on the contrary, in comparison to early
deals has accentuated on Dalal Street which has made frontline indices
footing firmer in the "red zone. However, bout of volatility is
expected to play at its fore just above the monthly expiry of F&O
series on Thursday.
Local equities following the downhill trajectory of the Asian equities chiefly tumbled in early trade as climbing yields on Spanish bonds that magnified worries over Europe's debt load, weighed on the sentiment. Meanwhile, negative leads from US stocks which sank overnight after government report showed the U.S. economy grew at a 2 percent annual rate from July through September, down from an initial estimate of 2.5 percent also added to the gloom. The US future indices too are showcasing somber trend.
Back on the home turf, stocks from Bankex, Oil & Gas and TECk counters played the foul for the street, while belonging stocks from Realty, Consumer Durable counters strive to negate the losses. With bears refuting to dislodge, 30 share barometer index- Sensex- declining over 200 points is trading sub 16k level. Meanwhile, 50 share index-Nifty-on NSE too has lost over 50 points to trade sub 4800 level. The broader indices imitating the style and pattern of frontline indices clobbered out of shape with intensive cuts of over 0.75% each. The overall market breadth on BSE is supporting declines which have outnumbered advances in the ratio of 1437:705, while 80 shares remained unchanged.
The BSE Sensex is currently trading at 15,833.17, down by 232.25 points or 1.45%. The index has touched a high and low of 15,969.60 and 15,804.33 respectively. There were only 2 stocks advancing against 28 declining ones on the index.
Selling pressure apparently has even accentuated in broader space as BSE Mid cap and Small cap indices declined lower by 1.04% and 0.77% respectively.
Bankex down by 2.10%, Oil & Gas down by 1.68%, TECk down by 1.67%, Auto down by 1.64% and Information Technology (IT) down by 1.61% were the top losers on BSE Sectoral space. On the flip side, Realty up by 0.17% and Consumer Durable (CD) up by 0.16% were the only gainers on the space.
HDFC Bank up by 3.32%, Bharti Airtel down by 2.85%, Jaiprakash Associates down by 2.52%, Reliance Industries (RIL) down by 2.52% and Mahindra & Mahindra down by 2.51% were the top losers on Sensex.
Meanwhile, the only two resilient stocks among 30 share index-Sensex- were Cipla up by 0.92% and Hindustan Unilever (HUL) up by 0.23%.Moreover, the Reserve Bank of India's (RBI) Governor D. Subbarao has hinted that the RBI may not change its anti inflationary monetary policy stance as the headline inflation has been hovering close to double digit mark, while the weekly food inflation remains above 10% mark since last five weeks. RBI Governor said that monetary steps may be warranted in the face of sustained rise in food prices.
'The direct role of monetary policy in combating food price pressures is limited, but in the face of sustained high food inflation, monetary action may still be warranted to anchor inflation expectations,' Subbarao said.
In order to control inflation, the RBI has increased its short term lending and borrowing rates for 13 times since March 2010, however, recently the apex bank has indicate that it may take pause in the rate hikes in December policy if inflation falls in line with its projected trajectory. However, the RBI governor feels that the solution to high food prices lies in a supply-side response from government. 'A lasting solution to food price pressures lies in a supply response that raises agricultural production and productivity, improves supply chain management and sets the right incentive framework for both producers and consumers, Subbarao said. By adding further he said 'The outlook on food inflation in the short to medium term will be determined by the speed and quality of such a supply response by the government.'
The governor is of the opinion that one of the main reasons of high food prices is increase in the minimum support prices of foodgarins by the government to the farmers. And shift in dietary habits towards protein-rich foods, pressure stemming from inclusive growth policies, shocks from global food inflation and financialization of commodities were other factors which are other factors.
'Inflation is a regressive tax and hurts the poor the most. The impact can be particularly severe in a country like India with a population of 1.2 billion, a per capita income of less than $1,500 and a large share of food in the total consumption basket,'
Subbarao has further stated that the government's food for work programme and proposed food subsidy bill had the potential to further raise fiscal deficit and inflationary pressures.
The S&P CNX Nifty is currently trading at 4,739.65, declined by 72.70 points or 1.51%. The index has touched a high and low of 4,779.50 and 4,734.00 respectively. There were just 4 stocks advancing against 46 declining ones on the index.
Siemens down by 3.68%, HDFC Bank down by 3.52%, IDFC down by 2.97%, Bharti Airtel down by 2.88% and BPCL down by 2.86% were the top losers of the broadly followed 50 share index- Nifty.
Moreover, Japanese markets- Nikkei 225- remained closed for the trade on Wednesday on account of Labor Thanksgiving day.
Local equities following the downhill trajectory of the Asian equities chiefly tumbled in early trade as climbing yields on Spanish bonds that magnified worries over Europe's debt load, weighed on the sentiment. Meanwhile, negative leads from US stocks which sank overnight after government report showed the U.S. economy grew at a 2 percent annual rate from July through September, down from an initial estimate of 2.5 percent also added to the gloom. The US future indices too are showcasing somber trend.
Back on the home turf, stocks from Bankex, Oil & Gas and TECk counters played the foul for the street, while belonging stocks from Realty, Consumer Durable counters strive to negate the losses. With bears refuting to dislodge, 30 share barometer index- Sensex- declining over 200 points is trading sub 16k level. Meanwhile, 50 share index-Nifty-on NSE too has lost over 50 points to trade sub 4800 level. The broader indices imitating the style and pattern of frontline indices clobbered out of shape with intensive cuts of over 0.75% each. The overall market breadth on BSE is supporting declines which have outnumbered advances in the ratio of 1437:705, while 80 shares remained unchanged.
The BSE Sensex is currently trading at 15,833.17, down by 232.25 points or 1.45%. The index has touched a high and low of 15,969.60 and 15,804.33 respectively. There were only 2 stocks advancing against 28 declining ones on the index.
Selling pressure apparently has even accentuated in broader space as BSE Mid cap and Small cap indices declined lower by 1.04% and 0.77% respectively.
Bankex down by 2.10%, Oil & Gas down by 1.68%, TECk down by 1.67%, Auto down by 1.64% and Information Technology (IT) down by 1.61% were the top losers on BSE Sectoral space. On the flip side, Realty up by 0.17% and Consumer Durable (CD) up by 0.16% were the only gainers on the space.
HDFC Bank up by 3.32%, Bharti Airtel down by 2.85%, Jaiprakash Associates down by 2.52%, Reliance Industries (RIL) down by 2.52% and Mahindra & Mahindra down by 2.51% were the top losers on Sensex.
Meanwhile, the only two resilient stocks among 30 share index-Sensex- were Cipla up by 0.92% and Hindustan Unilever (HUL) up by 0.23%.Moreover, the Reserve Bank of India's (RBI) Governor D. Subbarao has hinted that the RBI may not change its anti inflationary monetary policy stance as the headline inflation has been hovering close to double digit mark, while the weekly food inflation remains above 10% mark since last five weeks. RBI Governor said that monetary steps may be warranted in the face of sustained rise in food prices.
'The direct role of monetary policy in combating food price pressures is limited, but in the face of sustained high food inflation, monetary action may still be warranted to anchor inflation expectations,' Subbarao said.
In order to control inflation, the RBI has increased its short term lending and borrowing rates for 13 times since March 2010, however, recently the apex bank has indicate that it may take pause in the rate hikes in December policy if inflation falls in line with its projected trajectory. However, the RBI governor feels that the solution to high food prices lies in a supply-side response from government. 'A lasting solution to food price pressures lies in a supply response that raises agricultural production and productivity, improves supply chain management and sets the right incentive framework for both producers and consumers, Subbarao said. By adding further he said 'The outlook on food inflation in the short to medium term will be determined by the speed and quality of such a supply response by the government.'
The governor is of the opinion that one of the main reasons of high food prices is increase in the minimum support prices of foodgarins by the government to the farmers. And shift in dietary habits towards protein-rich foods, pressure stemming from inclusive growth policies, shocks from global food inflation and financialization of commodities were other factors which are other factors.
'Inflation is a regressive tax and hurts the poor the most. The impact can be particularly severe in a country like India with a population of 1.2 billion, a per capita income of less than $1,500 and a large share of food in the total consumption basket,'
Subbarao has further stated that the government's food for work programme and proposed food subsidy bill had the potential to further raise fiscal deficit and inflationary pressures.
The S&P CNX Nifty is currently trading at 4,739.65, declined by 72.70 points or 1.51%. The index has touched a high and low of 4,779.50 and 4,734.00 respectively. There were just 4 stocks advancing against 46 declining ones on the index.
Siemens down by 3.68%, HDFC Bank down by 3.52%, IDFC down by 2.97%, Bharti Airtel down by 2.88% and BPCL down by 2.86% were the top losers of the broadly followed 50 share index- Nifty.
On
the flip side, Reliance Communication up by 3.07%, Gail India up by
1.82%, Cipla up by 0.57% and Hindustan Unilever up by 0.29% were the
gainers of the index.
All the Asian markets were trading in the red;
Shanghai Composite declined 0.32%, Hang Seng lost 1.85%, Jakarta
Composite plunged 1.44%, KLSE Composite slid 0.77%, Straits Times
descended 1.48%, Seoul Composite plummeted 2.20% and Taiwan Weighted
knocked off 2.30%. Moreover, Japanese markets- Nikkei 225- remained closed for the trade on Wednesday on account of Labor Thanksgiving day.
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