RTTNews - The Indian market is set to open lower on Wednesday on the back of weak Asian cues following an overnight fall on Wall Street amid fresh concerns over the state of the U.S. economy. Analysts expect stocks to move sideways till Friday ahead of quarterly results announcement from Infosys and the release of industrial production report for May, which could offer some conclusive evidence on the direction of the domestic economy.
While foreign institutional investors(FIIs) sold shares worth Rs.921.39 crore on a net basis on Tuesday, domestic financial institutions purchased stocks worth Rs.790.16 crore, provisional data released by the BSE showed. On Tuesday, FIIs and domestic funds sold shares worth Rs.351.40 crore & Rs.587.80 crore, respectively, according to market regulator SEBI.
On Wall Street, the major U.S. averages finished sharply lower, as traders did some profit taking amid a lack of significant economic data to drive trading. Aside from the earnings data on tap for the second half of the week, traders also looked forward to a series of economic reports on employment, international trade and consumer sentiment, with expectations deflated following disheartening employment data last week.
According to the American Bankers Association, delinquencies on home-equity loans climbed to 3.52 percent from 3.03 percent in the fourth quarter of 2008, and late payments on the loans climbed to a record 1.89 percent. While the Dow Jones Industrial Average ended the session down nearly 2%, more than offsetting the gain posted in the previous session and finishing the day at a two-month closing low, the Nasdaq Composite fell 2.3% and the S&P 500 index shed 2%.
Crude oil futures tumbled more than $1 to below $63 a barrel in New york trading on Tuesday on deep concerns about energy demand after reports that the wold's top oil consumer may need to work out additional stimulus measures to prop up the economy implied that recovery is still far off. In Asian trading on Wednesday, crude oil was last trading at $62.31 a barrel, down 1%.
The rupee closed at Rs.48.47/48 against the dollar on Tuesday, off the day's high of Rs.48.27 but stronger than Monday's close of 48.56/59, helped by signs of stability in the domestic stock market after a 6% plunge in the previous session.
The Indian market rebounded a little on Tuesday after fairly high expectations on investments, taxes and policy impetus in the run-up to the budget led to a steep fall in the previous session. While favorable global cues helped lift sentiment, caution ahead of the upcoming earning season and a not- too- encouraging global picture restricted big gains.
The BSE Sensex moved widely between 14,252 and 14,001 before finishing at 14,170, up 127 points or 0.90%, while the S&P CNX Nifty rose 36 points or 0.88% to 4,202 and the broad-based BSE 500 index rose 0.72% and the mid-cap index advanced 0.92%. However, the small-cap index ended down 0.33%. Sector-wise, auto and FMCG stocks closed with notable gains, but public sector and oil/gas stocks ended sharply lower.
In corporate news, state-run companies such as IOC, MMTC, NMDC and NTPC could be in the spotlight on reports the government has drawn a 3-month road map to dilute its stake to below 75% in these companies to implement norms stipulating minimum public shareholding in listed firms.
Sun Pharmaceutical's U.S. subsidiary, Caraco Pharmaceutical Laboratories is cutting its workforce by more than a half after the recent clampdown by USFDA on the company's Michigan facilities idled most units, reports suggest.
Bharati Shipyard has revised its open offer price to Rs 405 per share for acquiring a stake in Great Offshore. The Andhra Pradesh government announced on Tuesday its decision to scrap the contract with the Maytas-led consortium to implement the Rs. 12,132 crore Hyderabad Metro Rail project.
Jet Airways and its rival Kingfisher Airlines together owed Rs1,500 crore to state-run refiners as of 31 March, civil aviation minister Praful Patel told the Rajya Sabha on Tuesday. Pantaloon Retail received shareholder nod to raise Rs 1,000 crore by selling shares to investors through the qualified institutional placement (QIP) route.
Tata Steel's sales volume surged up 22% to 1.4 million tons in the first quarter of the current fiscal on the back of robust demand from the auto and construction sectors. Bank of Maharashtra slashed its benchmark prime lending rate by 25 basis points to 12.25%. LIC Housing Finance slashed its floating interest rates by 50 basis points for existing customers.
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