Indian equity markets began the day's proceedings on a weak note due to heavy selling by funds and retail investors owing to weak global cues. Key benchmark indices extended losses and hit fresh intraday low in noon deals only to recover slightly from the day's lows. Market sentiment was particularly hit after the Reserve Bank of India (RBI) Governor Raghuram Rajan yesterday commented that high inflation is "a destructive disease" and is forcing the central bank to keep interest rates high. Selling pressure was seen in banking, consumer durables and realty stocks. While the BSE-Sensex closed lower by 240 points, the NSE-Nifty closed lower by 72 points. Both the BSE Mid Cap and the BSE Small Cap closed on a negative note.
As regards global markets, Asian indices closed in the red. European indices have opened in the red. The rupee was trading at Rs 62.2 to the dollar at the time of writing.
Novartis India Limited, the Indian arm of Swiss drug maker Novartis AG, announced its results for the quarter ended December 2013. Net profit of the company dropped almost by half after it cut prices of medicines covered by new drug price controls that took effect last year. Sales of the company declined by 4% YoY while net profit declined by 47.5% YoY. While the generics business posted sales of Rs 160 m, compared with Rs 157 m in the year ago quarter, the animal health and over-the-counter businesses also posted marginal increases to Rs 281 m and Rs 377 m from the year-ago period's Rs 240 m and Rs 320 m respectively.
The environment ministry, after studying for six months the Shah commission's report on illegal mining in Odisha that recommends Rs 600 bn should be recovered from miners, signed off on a proposal directing the state government to initiate action against the firms involved-including large Indian companies that are part of the Tata and Aditya Birla groups. If the state government acts on the controversial report, it will affect iron ore production in a state that is India's largest producer of the mineral and which supplies it to several steel plants in India and outside. The state government's action, when it happens, could hit steel companies hard.