Benchmark indices made a smart rebound on Thursday to settle marginally lower, in line with weak Asian stocks, as rating agency S&P cut China’s sovereign rating by one notch. Sensex fell 30 points to settle at 32,370, while Nifty settled at 10,122, down 19 points.
Investors were relieved as Federal Reserve’s two-day meet that concluded overnight did not throw any negative surprises. Also, hopes that the government might soon announce steps to arrest falling GDP growth too added
to the sentiment.
For the day, the BSE Sensex fell 30.47 points, or 0.09 per cent to settle at 32,370.04. The index at one point was down over 200 points, but buying in index heavyweights helped recoup some losses. Overall, it gyrated in a 300-point range during the day.
This was the third day of consecutive decline for the index.
Nifty50 settled the day at 10,121.90, down 19.25 points, or 0.19 per cent. Fear gauge India VIX ended flat at 11.63.
“Weakness in rupee reflected the markets’ reaction to FOMC outcome and potential rate hike in December. However a sharp recovery was seen from Nifty’s 12-day moving average. FM’s rhetoric on measures to review GDP has also served to arrest the decline. Current developments to bring petroleum products under GST might enthuse investors as this will have a long term impact on the inflation rates. It may help RBI cut rate,” said Anand James, Chief Market Strategist, GeojitBSE 0.82 % Financial Services.
Banking stocks were at the receiving end. ICICI BankBSE -1.99 % fell 1.99 per cent to Rs 285 and was the top index loser. Axis BankBSE -1.37 % declined 1.37 per cent to Rs 512.25. SBI edged 0.76 per cent lower at Rs 268.50. Other index losers included Coal Idnia, ONGCBSE -0.93 % aqnd Asian Banks, which fell 0.9-1 per cent. Gainers included pharmaceutical stocks.
Dr Reddy’s Labs surged 7.47 per cent to Rs 2,486.45. The stock rose after the drug maker said it has received an Establishment Inspection Report (EIR) from the USFDA for Unit II of its formulation facility at Srikakulam Plant (SEZ), Andhra Pradesh. CiplaBSE 4.04 %, LupinBSE 3.02 % and Sun PharmaBSE 2.59 % gained 4.04 per cent, 3.02 per cent and 2.59 per cent, respectively.
Shares of Orchid Pharma hit 20 per cent upper circuit limit in Thursday’s trade after the drug firm received favourable US FDA inspection report for its Tamil Nadu-based facility.
Matrimony.com had a poor debut on BSE. The stock closed the day at Rs 901.20, down 8.51 per cent over its issue price of Rs 985. The IPO by SBI LIfe had crossed halfway mark by the time of writing this report.
The US Fed has forecast only two rate increases in 2019 and one in 2020. The US central bank said that it would stick to the schedule for normalising balance sheet by trimming its bond portfolio from October. Fed would cut up to $10 billion worth of US Treasury bonds and mortgage-backed securities each month from the amount of maturing securities it reinvests to reduce its approximately $4.2 trillion holdings by about $1 trillion or more over several months, reports suggested.
Meanwhile, Finance minister Arun Jaitley on Wednesday said steps to lift the slowing economy will be taken after these are endorsed by Prime Minister Narendra Modi.
“We have taken note of all the economic indicators available,“ Jaitley told reporters.. “The government will take any additional moves which are necessary.”
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