Nifty, Sensex trendless – Wednesday closing report
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I had mentioned in
Tuesday’s closing report that Nifty, Sensex were still on course to head
higher. The major indices of the Indian stock markets were positive in the morning
but closed with minor losses on Wednesday.
Uncertain global
situation, profit booking and a weak rupee depressed the Indian equity markets
on Wednesday, as selling was witnessed in automobile, capital goods and FMCG
(fast moving consumer goods) stocks. The BSE market breadth was skewed in
favour of the bears -- with 1,597 declines and 988 advances. Initially, the key
indices opened positive as investors believed that Britain's upcoming
referendum on whether or not to stay on in the European Union would go in favour
of staying with EU.
India's cabinet on
Wednesday cleared the base price for the country's largest spectrum auction to
date, expected to fetch around $85 billion at the approved reserve price,
address the menace of mobile phone call drops and give a push to 4G data
communications. The approval was given at a meeting of the cabinet chaired by
Prime Minister Narendra Modi. But a decision on spectrum usage charges, which
has evoked strong opinions from stakeholders, has been deferred and the matter
referred again to the telecom watchdog. "This will be the largest auction
to date," Jaitley said in a press briefing later. He said since the
recommendations on spectrum usage charges from the attorney general's office
and the Telecom Commission came later, it was felt that the matter be referred
to the watchdog once again. "The appetite for India's telecom sector is
very big," Communications and IT Minister Ravi Shankar Prasad, who also
briefed the media, said, when asked if such a large auction will evoke the kind
of interest which the government is hoping for. More than 2,300 MHz of airwaves
will be on the block for telecom operators in seven bands -- 700 MHz, 800 MHz,
900 MHz, 1,800 MHz, 2,100 MHz, 2,300 MHz and 2,500 MHz. Based on their
pan-India reserve price the mop up can be as much as $83 billion against
$17-billion the last time. With the public having forgotten the Supreme Court
cases on old spectrum allocations, the government is moving on with industry
growth.
The US dollar decreased
against most major currencies on Tuesday as investors were digesting Federal
Reserve Janet Yellen's remarks during her semi-annual testimony. In her
testimony before the US Senate Banking Committee on Tuesday, Yellen reiterated
the cautious approach to raising interest rates that the central bank signalled
last week after its policy meeting. She said that the central bank expected
interest rates to "remain low" for some time, in view of the weak
global economy and sluggish productivity growth.
The top gainers and top
losers of the major indices are given in the table below:
The closing values of the
major Asian indices are given in the table below:
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