Sensex slides below 28,000 on weak global cues
Key benchmark indices declined last week as continued concerns about Greece's debt crisis weighed on sentiment in global markets. A sharp setback in Chinese stock market also spoiled sentiment. A three-week selloff in China's stock market has darkened the outlook for the world's second-largest economy. The S&P BSE Sensex fell below the psychological 28,000 mark.
Foreign portfolio investors (FPIs) have bought shares worth a net Rs 3,167.70 crore in this month so far (till 9 July 2015). They have bought shares worth a net Rs 375.13 crore from the secondary equity markets in this month so far (till 9 July 2015). FPIs sold shares worth a net Rs 3344.44 crore last month. They had sold shares worth a net Rs 4634.53 crore into the secondary equity markets last month.
The S&P BSE Sensex fell 431.39 points or 1.54% to settle at 27,661.40 last week. The 50-unit CNX Nifty fell 124.35 points or 1.47% to settle at 8,360.55.
Broader market depicted strength. The S&P BSE Mid-Cap index rose 0.45 points to settle at 10,870.45. The BSE Small-Cap index rose 32.36 points or 0.29% to settle at 11,335.94. Both these indices outperformed the Sensex.
Trading for the week began on a positive note. Banking, cement, pharma stocks and index heavyweights HDFC, ITC, Reliance Industries (RIL) and L&T led a strong intraday rebound on the domestic bourses on Monday, 6 July 2015. The S&P BSE Sensex rose 115.97 points or 0.41% to settle at 28,208.76, its highest closing level since 17 April 2015. The Nifty rose 37.25 points or 0.44% to settle at 8,522.15, its highest closing level since 17 April 2015.
Shares of oil exploration and production companies led losses for key benchmark indices on Tuesday, 7 July 2015. Benchmark indices registered small losses for the day. The S&P BSE Sensex fell 37.07 points or 0.13% to settle at 28,171.69, its lowest closing level since 3 July 2015. The CNX Nifty fell 11.35 points or 0.13% to settle at 8,510.80, its lowest closing level since 3 July 2015.
Metal and banking stocks led losses as key benchmark indices plunged on Wednesday, 8 July 2015. Intraday recovery for the benchmark indices witnessed earlier during the trading session and during the latter part of the trading session proved short lived. The S&P BSE Sensex fell 483.97 points or 1.72% to settle at 27,687.72, its lowest closing level since 29 June 2015. The 50-unit CNX Nifty fell 147.75 points or 1.74% to settle at 8,363.05, its lowest closing level since 29 June 2015.
Key benchmark indices edged lower in volatile session on Thursday, 9 July 2015. After moving in a narrow range for most part of the day, key benchmark indices dropped to intraday low in late trade led by decline in oil & gas and IT stocks. The S&P BSE Sensex fell 114.06 points or 0.41% at 27,573.66, its lowest closing level since 19 June 2015. The CNX Nifty fell 34.50 points or 0.41% at 8,328.55, its lowest closing level since 19 June 2015.
Key benchmark indices logged modest gains on last trading day of the week on Friday, 10 July 2015 . High intraday volatility was witnessed throughout the day as the key indices alternately swung between positive and negative zone. The S&P BSE Sensex rose 87.74 points or 0.32% to settle at 27,661.40, its highest closing level since 8 July 2015. The CNX Nifty gained 32 points or 0.38% to settle at 8,360.55, its highest closing level since 8 July 2015.
Among the 30 Sensex shares, 22 declined and the remaining shares rose.
Metal and mining stocks fell as global commodity prices dropped amid a dimming outlook for China's economy. China is the world's largest consumer of steel, copper and aluminum.
Vedanta was the top Sensex loser last week. It slumped 14.44% to Rs 146.
Tata Steel fell 6.65% to Rs 280.95. Tata Steel crude steel production rose 0.5% to 2.35 million tonnes in Q1 June 2015 over Q1 June 2014. Tata Steel's production of hot metal rose 2.4% to 2.59 million tonnes in Q1 June 2015 over Q1 June 2014. The company made announcement after market hours on Thursday, 9 July 2015.
Hindalco Industries fell 5.38% to Rs 104.60. With respect to news article titled, "PIL on Hindalco: I-T Dept filed report, estimates that Hindalco dealing with unaccounted cash worth Rs 200 crore - Hindalco paid Rs 7 crore in kickbacks to environment ministry", Hindalco Industries clarified after market hours on Tuesday, 7 July 2015, that there was nothing new in the allegations and the matter is already under investigation. The company reiterated that neither the diary nor the cash recovered belongs to the company. The Central Bureau of Investigation (CBI) had raided Hindalco's offices in four cities as part of its investigations into alleged illegalities in the allocation of two coal blocks in Odisha.
Tata Motors fell 7.25% to Rs 401.95 on concerns demand for its luxury brand of cars, Jaguar Land Rover will take a hit after worries about a slowdown in China. China is the biggest market for Tata Motors' luxury car unit, Jaguar Land Rover (JLR). The Chinese stock markets continued their plunge this week, wiping close to 37% off their market valuation from the peak of early June 2015.
TCS fell 5.10% to Rs 2,471.90. On a consolidated basis, TCS' net profit rose 53.1% to Rs 5684 crore on 6% increase in revenue at Rs 25668 crore in Q1 June 2015 over Q4 March 2015. Operating income grew 76.5% to Rs 6724 crore in Q1 June 2015 over Q4 March 2015. The result was declared after market hours on Thursday, 9 July 2015.
During the quarter, TCS posted the incremental revenues of $136 million driven by strong growth across core markets led by North America, UK, Europe, MEA and Asia Pacific. Growth among industry segments was led by retail, life sciences, BFSI and telecom. Asset-leveraged solutions led the growth among service lines followed by infrastructure, assurance and BPS.
Wipro fell 0.23% to Rs 548.60. Wipro announced after market hours on Thursday, 9 July 2015, that Wipro Digital, its digital business unit, intends to acquire Designit, an award winning and global strategic design firm specializing in designing transformative product-service experiences. This investment marks a further stage in Wipro's move to evolve the digital offer it takes to market, combining its reputation and heritage in deep engineering and transformative technology with human centered-design methods.
Designit's capabilities and proven record in strategic design, user experience (UX), interaction design (IxD) and product innovation result in meaningful product-service experiences that help people live smarter, healthier and more productive lives. Designit's expertise in experience-driven design complements Wipro Digital's capabilities in technology, digital strategy, design, and digital architecture. Together, the two organizations become a comprehensive and scalable global digital transformation partner for the entire C-suite, helping to improve customer experience while radically digitizing business operations, Wipro said in a statement.
Infosys fell 5.35% to Rs 937. Infosys said it will offer the Finacle suite of software solutions on Verizon Cloud. The fully integrated Finacle Core and Digital banking solutions, currently serving over 547 million consumers worldwide, are now available in a Software-as-a-Service (SaaS) model for community financial institutions in the US. The announcement was made after market hours on Thursday, 9 July 2015.
The Finacle solutions provide a single real-time view of customers, members, products and transactions and enable the creation of bespoke services for customers. These help banks and credit unions to enhance operational efficiency, accelerate speed-to-market for new offerings, and reduce time and cost of compliance. The new SaaS offerings of Finacle will empower financial institutions to deliver a multichannel experience to customers, without major capital investment and with greater flexibility and ease, Infosys said in a statement.
Maruti Suzuki India fell 1.65% to Rs 3,936. Maruti Suzuki India said its bestseller Celerio clocked sale of over 1 lakh units. Launched at Delhi Auto Expo 2014, Celerio is credited with introducing Auto Gear Shift Technology in the Indian automobile industry. By offering the convenience of automatic transmission at an affordable cost and with fuel efficiency at par with manual transmission, Celerio has delighted customers by fulfilling a latent need. Sensing the customer need, Maruti Suzuki introduced the Celerio Diesel in June 2015, the company said in a statement. The announcement was made after market hours on Thursday, 9 July 2015.
Cipla rose 2.71% to Rs 648.50. Cipla announced after market hours on Thursday, 9 July 2015, that its board approved divestment of its consumer healthcare business to a wholly-owned subsidiary (proposed to be incorporated) on a going-concern basis by way of a slump sale for a consideration of Rs 10.5 crore.
The aforesaid divestment would enable the company to participate in the attractive & growing over-the-counter ("OTC") market. This business requires a specialised FMCG kind of focus. A separate subsidiary would enable the company to attract right talent and provide the focus and attention required for this business, Cipla said in a statement.
The amount and percentage of the turnover contributed by the OTC division of the company, during the last financial year 2014-15 was Rs 34.88 crore or approximately 0.3% of the Total Income (Audited Consolidated) of the company for fiscal year (FY) 2014-2015. The net worth of OTC division of the company as on 31 March 2015 was Rs 6.45 crore contributing 0.06% of the net worth of the company. The sale agreement is yet to be finalized. The transaction is expected to be completed in the third quarter of FY 2015-2016, subject to receipt of necessary approvals.
None of the persons belonging to Promoter / Promoter Group(s) of the company has any interest in the transaction. The transaction is a related party transaction and it is being done on an arm's length basis, Cipla said.
Power equipment major Bharat Heavy Electricals (Bhel) gained 4.08% to Rs 268.85. Bhel during market hours on Friday, 10 July 2015 said that continuing the commissioning trend in the last quarter of FY 2014-15, the company has successfully commissioned the second 500 megawatts (MW) unit at Tuticorin Thermal Power Station (TPS). The first 500 MW unit of the project was commissioned by Bhel on 10 March 2015.
Dr Reddy's Laboratories jumped 4.42% to Rs 3,739.45. It was the top Sensex gainer last week.
In the overseas market, there was no breakthrough on Greece debt after an emergency summit of eurozone leaders held Tuesday, 7 July 2015. The European Union has given Greece a deadline of Sunday, 12 July 2015, to produce a credible reform proposal and reach an agreement with lenders or risk sliding into bankruptcy and a eurozone exit.
The Greek Prime Minister Alexis Tsipras sought a three-year bailout loan of at least 53.5 billion euros ($59.2 billion), in a last-ditch effort to keep the country in the euro. The details emerged after US markets closed on Thursday, 9 July 2015. In exchange, it offered a package of reforms and spending cuts, including pension savings and tax increases, similar to the one presented by creditors last month. The proposal was submitted to European institutions late on Thursday, 9 July 2015 and will be presented to the Greek Parliament on Friday, 10 July 2015. It is set to be discussed at a summit of European Union leaders on Sunday, 12 July 2015, to determine whether Greece gets a new bailout, or be forced to leave the single currency.
Greece offered measures that almost mirrored a proposal from creditors on 26 June 2015, which was rejected by voters in a 5 July 2015 referendum. In return, it asked for its long-term debt to be made more manageable to allow it to rebound from a crisis that has erased a quarter of its economy.
Meanwhile, the International Monetary Fund on Thursday, 9 July 2015, cut its forecast for global growth this year, citing a weaker first quarter in the US and expressed confidence financial-market turbulence from China to Greece won't cause widespread damage.