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Indian Stock Market News, Equity Market and Sensex Today in India | Equitymaster
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Markets begin on a negative note 
(Wed, 19 May 09:30 am) 
 
The Indian markets have started today's session on an extremely negative note. The benchmark indices opened below the breakeven mark and soon slipped further into the red. They have not managed to emerge out of the negative territory since then. Other key Asian markets are in the red with South Korea (down 1.8%) leading the pack of losers. The US markets closed lower by 1.1% yesterday.

Currently in India, heavyweights from the BSE-Sensex are trading weak with metal and construction majors facing the brunt of selling activity. The BSE-Sensex is trading lower by around 151 points, while the NSE-Nifty is down by about 48 points. Selling interest is also being witnessed among mid and small cap stocks as the BSE-Midcap and BSE-Smallcap indices are trading lower by 0.1% and 0.2% respectively. The rupee is trading at 45.86 to the US dollar.

Energy stocks have opened the day on a negative note. Losers here include Cairn India and Gujarat Gas. As per a leading business daily, the government is planning to launch the ninth round of the New Exploration Licensing Policy (NELP) in July this year. Around 45 oil and gas blocks will be put up for auction. Some of these blocks will be from the eighth round for which no bids were received. Of the 70 blocks offered under Nelp-VIII, only 36 attracted bids. The failure was attributed to falling crude oil prices which resulted in a freeze in exploration plans of global energy majors. However, the lack of clarity in policies such as tax holiday on gas production also contributed. It may be noted that NELP auctions have resulted in major hydrocarbon discoveries by both Reliance Industries and ONGC. Hence in our view, it is high time we sorted out the policy issues to attract investments into India's energy sector especially given the fact that we import over 70% of our hydrocarbon needs.

Textile stocks have opened the day on a negative note. Losers here include Welspun India and Alok Industries. Raymond announced its FY10 results. It reported a 3% YoY decline in standalone sales during the year. Standalone EBIDTA margins improved to 10% in FY10 from 9% in FY09, due to lower input costs. While garments enjoyed higher margins, the branded apparel business suffered from lower volume growth. The company declared profits at the net level as against losses last year. The improvement was due to the absence of losses on foreign currency borrowings this fiscal. The results include the voluntary retirement write offs, which also took a toll this year. 88 new stores were opened during FY10 adding 99,000 sq feet of retail space and this sustained Raymond's position as India's largest specialty retailer. Simultaneously, aggressive reviews of the non performing stores during the year resulted in 28 store closures. The company plans to add 200 stores in tier 3 and 4 cities by 2011 mainly through the franchise model.

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Jul 26, 2017 03:36 PM

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