Sesa Sterlite drops after SC ruling on Goa iron ore

After reversing intraday losses, key benchmark indices once again slipped into the red in afternoon trade as European stocks dropped in early trade there. The barometer index, the S&P BSE Sensex, was currently down 61.60 points or 0.23% at 26,322.47. The market breadth indicating the overall health of the market was negative. Foreign portfolio investors (FPIs) sold shares worth a net Rs 671.06 crore yesterday, 13 October 2014, as per provisional data. Asian stocks were mixed. US index futures pointed to a recovery of US stocks after yesterday’s sell-off.

Sesa Sterlite edged lower in volatile trade on reports that the Supreme Court has reiterated a prior ruling that all iron ore mined in Goa before 2007 belonged to the state. Realty major DLF tumbled to record low after Securities and Exchange Board of India barred the company and its chairman K.P. Singh along with five other company executives from accessing India’s capital markets for three years. Other realty stocks were mixed. Among side counters, Sun TV Network hit 52-week low. Asahi India Glass hit 52-week high. Federal Bank and Symphony scaled record high.

Key indices have seen intraday volatility so far during the day. Benchmark indices had briefly turned positive from negative in afternoon trade after the latest data showed a substantial easing of wholesale price inflation in September 2014. Earlier, key indices had reversed direction after a firm opening triggered by data released after trading hours yesterday, 13 October 2014, showing easing of consumer price inflation last month.

In overseas markets, European stocks fell as data showing decline in French consumer prices in September added to worries over persistently low inflation in the eurozone. Asian stocks were mixed. US index futures pointed to a recovery of US stocks after yesterday’s sell-off.

Brent crude oil prices dropped as expectations faded that OPEC could cut output and shore up prices.

In the foreign exchange market, the rupee edged lower against the dollar in choppy trade.

At 13:13 IST, the S&P BSE Sensex was down 61.60 points or 0.23% at 26,322.47. The index lost 172.06 points at the day’s low of 26,212.01 in mid-morning trade. The index surged 166.72 points at the day’s high of 26,550.79 at the onset of the trading session, its highest level since 10 October 2014.

The CNX Nifty was down 25.95 points or 0.33% at 7,858.30. The index hit a low of 7,825.45 in intraday trade. The index hit a high of 7,928 in intraday trade, its highest level since 9 October 2014.

The BSE Mid-Cap index was up 18.48 points or 0.19% at 9,508.24. The BSE Small-Cap index was up 19.90 points or 0.19% at 10,666.37. Both these indices outperformed the Sensex.

The market breadth indicating the overall health of the market was negative. On BSE, 1,358 shares declined and 1,237 shares gained. A total of 109 shares were unchanged.

The total turnover on BSE amounted to Rs 1871 crore by 13:15 IST.

Sesa Sterlite lost 2.74% to Rs 243.40. The stock saw high intraday volatility. The stock dropped as much as 12.38% at the day’s low of Rs 219.25 so far during the day. The stock rose as much as 0.91% the day’s high of Rs 252.55 so far during the day. High volumes accompanied the decline in the stock. On BSE, 20.86 lakh shares changed hands in the counter so far, compared with average daily volume of 5.52 lakh shares during the past one quarter. As per reports, the Supreme Court today, 14 October 2014, reiterated a prior ruling that all iron ore mined in Goa before 2007 belonged to the state. The court has ordered pre-2007 iron ore to be auctioned by a monitoring panel, according to reports. Sesa Sterlite was formed after Vedanta Resources Plc merged Sterlite Industries and Sesa Goa in 2013.

Realty major DLF tumbled 25.53% at Rs 109.25. The stock hit a record low of Rs 107.25 in intraday. High volumes accompanied the decline in the stock. On BSE, 1.23 crore shares changed hands in the counter so far, compared with average daily volume of 11.14 lakh shares during the past one quarter. Market regulator Securities and Exchange Board of India (Sebi) on Monday, 13 October 2014, barred DLF and its chairman K.P. Singh along with five other company executives from accessing India’s capital markets for three years. The order is related to lapses in disclosures made at time of the company’s IPO in 2007.

DLF said before market hours today, 14 October 2014, that the order dated 10 October 2014 passed by the whole time member of Securities and Exchange Board of India (Sebi) has come to the notice of DLF only on 13 October 2014. The order is being reviewed by DLF and its legal advisors. DLF and its board wish to reassure its investors and all other stakeholders that it has not acted in contravention of law either during its initial public offer or otherwise, DLF said. DLF and its board were guided by and acted on the advise of eminent legal advisors, merchant bankers and audit firms while formulating its offer documents, the company said. DLF will defend itself to the fullest extent against any adverse findings and measures contained in the order passed by Sebi, DLF said. The realty major said it has full faith in the judicial process and is confident of vindication of its stand in the near future, the company added.

Other realty stocks were mixed. Indiabulls Real Estate (up 1.13%), Sobha (up 2.49%) and Oberoi Realty (up 0.42%) gained. Godrej Properties (down 0.26%), Unitech (down 1.35%), Housing Development and Infrastructure (down 1.89%) and Parsvnath Developers (down 0.49%) declined.

Sun TV Network lost 4.84% to Rs 309.90 after hitting a 52-week low of Rs 307 in intraday trade.

Asahi India Glass surged 5.91% to Rs 117.40 after hitting a 52-week high of Rs 121.60 in intraday trade.

Federal Bank gained 2.06% to Rs 138.40 after scaling a record high of Rs 139.15 in intraday trade.

Symphony advanced 6.19% to Rs 1,558 after scaling a record high of Rs 1,608.70 in intraday trade.

Meanwhile, provisional data released by the stock exchanges after trading hours yesterday, 13 October 2014, showed that foreign portfolio investors (FPIs) sold shares worth a net Rs 671.06 crore on that day.

Meanwhile, the stock market will remain closed tomorrow, 15 October 2014, on account of assembly election in Maharashtra.

In the foreign exchange market, the rupee edged lower against the dollar in choppy trade. The partially convertible rupee was hovering at 61.175, compared with its close of 61.10 during the previous trading session.

Brent crude oil prices dropped as expectations faded that OPEC could cut output and shore up prices. Brent for November settlement was off 52 cents at $88.37 a barrel. The contract had tumbled $1.32 to settle at $88.89 a barrel on Monday, 13 October 2014, its lowest closing level since 1 December 2010. Brent for December settlement was off 37 cents at $89.04 a barrel.

Lower crude oil prices will help India in containing its fiscal deficit, current account deficit and fuel price inflation. India imports 80% of its crude oil requirement.

The annual rate of inflation based on the Wholesale Price Index (WPI) eased to 2.38% in September 2014, from 3.74% in August 2014, data released by the government today, 14 October 2014, showed. Core WPI inflation which excludes volatile food and fuel prices eased to 2.8% in September 2014, from 3.5% in August 2014. Meanwhile, July WPI inflation rate was revised upwards to 5.41% from 5.19% reported earlier.

The WPI data comes after another data released by the government after trading hours yesterday, 13 October 2014, showed easing of consumer price inflation last month. The annual rate of inflation based on the combined consumer price indices (CPI) for urban and rural India eased to 6.46% in September 2014, from 7.73% in August 2014. The rate of inflation based on the combined consumer food price indices (CFPI) for urban and rural India eased to 7.67% in September 2014, from 9.35% in August 2014, the data showed. Core CPI inflation which excludes food and energy prices, eased to 5.9% in September 2014, from 6.82% in August 2014.

European stocks fell today, 14 October 2014, as data showing decline in French consumer prices in September added to worries over persistently low inflation in the eurozone and as investors awaited German investor confidence report. Key benchmark indices in UK, France and Germany were off 0.15% to 0.33%.

French consumer prices fell further than expected in September, adding to concerns over persistently low inflation in the eurozone. Consumer prices in the eurozone’s second-largest economy fell 0.4% in September from August and were 0.3% higher than in September last year

Asian stocks were mixed today, 14 October 2014. Key indices in Singapore, Taiwan, South Korea and Indonesia were up 0.02% to 0.65%. Key indices in China, Hong Kong and Japan were off 0.16% to 2.38%.

China’s central bank cut the interest rate it pays lenders for 14-day repurchase agreements for the second time in a month. The People’s Bank of China sold 20 billion yuan ($3.3 billion) of the contracts at 3.4% today, 14 October 2014, according to a statement on its website. That compares with 3.5 percent in a similar auction on 9 October 2014.

Trading in US index futures indicated that the Dow could gain 57 points at the opening bell today, 14 October 2014. The US stock market ended Monday’s volatile session sharply lower as selling intensified at the last hour. Volatile trading came on the heels of last week’s deep losses that had been triggered by global economic growth concerns.

Other Fed officials joined Vice Chairman Stanley Fischer in signaling that the threat posed by slowing global growth may cause US rate increases to be delayed. Chicago Fed President Charles Evans reiterated his concern yesterday that inflation may only quicken slowly toward the US central bank’s 2% goal and said officials should be exceptionally patient in adjusting monetary policy.