Sensex dives 370 pts, Bank Nifty dips 3%; Titan falls 12%
The market has opened weak. The Sensex falls 115 points at 19252.11. The Nifty is down 54 points after opening above 5700. About 133 shares have advanced, 199 shares declined, and 26 shares are unchanged.
Live Market Commentary
9:50 am FII view: Adrian Mowat, Chief Asian and Emerging Equity Strategist, JPMorgan advises investors to book partial profit in Indian IT stocks and exporting companies and investing in private banks on correction.
"A tactical approach would be to switch from exporters, which have outperformed substantially and one of the best sector in whole of the emerging market - Indian IT. Put some money into the private sector banks in India which have been hit hard. These are good long-term franchises" he elaborated.
He expects the Indian equity market to witness a sharp recovery rally if the rupee strengthens back towards 60/USD level in the next few days. If the slide in rupee continues, then one should brace for more selloff, he cautioned.
9:40 am Telecom update: Telecom operators, including BSNL and Bharti Airtel, owe the government Rs 30,158.05 crore as outstanding spectrum charges, including the one-time fee and usage charges, reports PTI.
As per official data, GSM players owe Rs 25,748.91 crore as spectrum charges while the outstanding dues of CDMA operators stood at Rs 4,409.14 crore. Demand notices have been issued to the operators to recover the amount.
"The demand notices have been issued after the completion of assessment," Minister of State for Communications and IT Milind Deora said in Parliament.
GSM operators owe Rs 23,177.66 crore as one-time spectrum charges and Rs 2,571.25 crore as outstanding spectrum usage charges, including penalty and interest, Deora said.
9:35 am Falling: Banking stocks are getting hammered down as Bank Nifty falls 3 percent while BSE Bankex is also weak. RBI announces a slew of measures to curb rupee volatility . The interest rate ceiling on foreign currency non resident deposits has been revised. For accounts that have a maturity period of three to five years its has been hiked to libor plus 400 basis points till November 30 this year.
Not just that non-resident rupee and forex deposits have been given an exemption from CRR and SLR from the August 24. The exemption will apply for deposits with maturity of three years.
The depreciating rupee and efforts to control it is now beginning to touch the Indian upper middle class and all of corporate India. Companies until now could spend up to 400 percent of their networth abroad to acquire or expand.
The RBI has brought this limit down to 100 percent of net worth. Indians could spend upto 2 lakh dollars a year to finance their children's education or for any indulgence or even investment. Now they can spend on 75,000 dollars a year and they can't remit dollars to buy land abroad.
9:30 am: FMC refers NSEL case to the finance ministry. The ministry is going to check money laundering, warehouse fraud. NSEL to hand over warehouse to FCI and Central Warehousing Corporation.
9:20 am Alert: TCS has been slapped with a lawsuit by Orange County in California for making "a series of false promises and intentional misrepresentations" during the bidding process for a contract.
TCS declined to comment on the issue, citing it as a legal matter.
The issue relates to a contract for development of a tax collection and management system for Orange County in 2007-2008. TCS won the bid for the job for an amount of about USD 8 million.
Don't miss: Gold eases but on track for best week in a month
The market has opened weak. The Sensex falls 115 points at 19252.11. The Nifty is down 54 points after opening above 5700.
About 133 shares have advanced, 199 shares declined, and 26 shares are unchanged.
Titan Industries slumps 12 percent as it faces three major downgrades in last 24 hours on the back of gold import duty hike. The government increased import duty on gold, silver and platinum to 10 percent with a view to arrest the declining value of rupee and contain the fiscal deficit to 3.7 percent of the GDP.
The government has also raised the duty on gold ore/ concentrates/dore bars and silver dore bars ranging from 7 percent to 10 percent.
The Indian rupee opened marginally higher at 61.35 per dollar versus 61.43 yesterday.
Himanshu Arora, Religare said, "The rupee may weaken further as inflation surged to 5.79 percent. Sustained dollar demand from importers, especially oil firms may underpin the dollar against the rupee. The currency may range between 61.28-61.70/USD."
The euro rose back to 1.33 to the dollar. The dollar index slipped to 81.15 levels. The dollar yen was around 97.
Markets finished near their session lows on Thursday, with the Dow dropping more than 200 points, as bond yields jumped to their highest level in two years and as the market continued to gauge when the Federal Reserve might start to reduce its asset purchases. The CBOE volatility index shot near 15.
The 10-year treasury yield jumped to 2.82 percent, its highest level in two years, before pulling back to 2.75 percent.
Brent crude was hovering around USD 109 per barrel. Meanwhile Nymex traded around 107. From precious metals space, gold is trading at two-month highs.