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20 December
2016
I had
mentioned in Monday’s closing report that Nifty, Sensex might head lower. The
major indices of the Indian stock markets were range-bound on Tuesday and
closed with small losses of around 0.25%. Trading was listless as indicated by
the low NSE turnover of 72.62 crore. The trends of the major indices in the
course of Tuesday’s trading are given in the table below:
 |
Major Indices (The Total
Investment & Insurance Solutions)
Weak global indices, coupled with
foreign fund outflows and rupee depreciation, dragged the Indian equity markets
lower on Tuesday. The key indices closed on a flat note -- marginally in the
red, as selling pressure was witnessed in banking, healthcare and automobile
stocks. The BSE market breadth was skewed in favour of the bears -- with 1,777
declines and 832 advances. On the NSE there were 427 advances, 1,180 declines
and 74 unchanged.
Finance Minister Arun Jaitley on
Monday said the Reserve Bank of India (RBI) has sufficient stock of cash, which
would last way beyond December 30. "RBI has adequate cash, not only to
last till December 30, but well beyond that," said Jaitley while briefing
the media. On the question of being less prepared, Jaitley said: "There
was complete preparation. Not even for a single day did the RBI not release
adequate currency stock through the banking system." This is important in
the face of the widespread belief that specific sectors like the real estate
sector have suffered a downturn after the demonetisation policy was announced.
US stocks ended higher after
wavering in a tight range as investors digested a speech from Federal Reserve
Chair Janet Yellen. Yellen said at a University of Baltimore commencement
ceremony on Monday that the US has the strongest jobs market in nearly a
decade, and there are indications wage growth is picking up. This could lead to
a gentle migration of funds of foreign institutional investors from India to
USA.
The Total Investment & Insurance Solutions
The Fed also released its updated
economic projections, which indicated that the central bank forecasts three
rate hikes next year, while in its September projections, Fed officials
expected only two rate hikes in 2017. The Total Investment & Insurance
Solutions
Finance Minister Arun Jaitley on
Tuesday indicated that no populist measures will come through for the railways
when its budget will be merged with the general budget from the next fiscal.
"Around the world that organisation is successful which follows a
financial model wherein consumers pay for the services they use," Jaitley
said here at the national conference on Accounting Reforms in Indian Railways
organised by Confederation of Indian Industry (CII). He said populism required
that consumers do not need to pay for the services they use but these were not
the principles "on which the largest operator of transport can work".
"We aim for a creation of Railways as a service organisation which is
commercially able to sustain itself and also provide world class quality and
infrastructure." These policy measures from the government could lead to
higher inflation and higher interest rates, thus weakening the indices in the
stock markets.
The Total Investment & Insurance Solutions
Pharma major Cipla on Monday said
that it plans to raise Rs 4,000 crore through the issue of various securities,
subject to regulatory approvals. The decision to raise the targeted fund was
taken by its Board of Directors, the pharma major said in a regulatory filing to
the BSE. The company disclosed that it plans to raise "funds up to Rs
2,000 crores by issue of equity shares or American depository receipts or
global depository receipts or foreign currency convertible bonds or other
securities/ financial instruments, whether denominated in Indian rupee and/or
foreign currency(ies), though a public issue or a private placement in
accordance with the provisions of the applicable law". It plans to
raise another Rs 2,000 crore via the issue of non-convertible debentures (NCDs)
or bonds. Cipla shares closed at Rs562.00, down 1.13% on the BSE on Tuesday. The Total Investment
& Insurance Solutions
The central parity rate of the
Chinese currency renminbi, or the yuan, weakened 156 basis points to 6.9468
against the US dollar on Tuesday, according to the China Foreign Exchange
Trading System. This was also a factor in the weak cues received from Asian
markets in Tuesday’s trading in the Indian stock markets. The Total Investment
& Insurance Solutions
The top gainers and top losers of
the major indices are given in the table below:
 |
Top Gainer (The Total
Investment & Insurance Solutions)
The closing values of the major
Asian indices are given in the table below:The Total Investment
& Insurance Solutions
 |
| Asian Indices (The Total Investment & Insurance Solutions) |
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