After yesterday’s rally, it is a terrible day for the markets today tracking weak Asian markets. The Sensex has opened 170 points lower at 16860 while the Nifty is down 50 points 5110 levels. The rupee too fell to a record low against the dollar at 56.80 for the second successive session today as risk assets continued to be under pressure on fears of a global growth slowdown.Traders remained wary of any potential intervention from the central bank to defend the currency. At 9:02 a.m., the rupee was at 56.79/80 to the dollar versus its 56.30/31 close on Thursday.
The downgrade of 15 of the world’s biggest banks by Ratings agency Moody’s is likely to have its spill over impact on the Indian banking stocks too.
cement stocks are under pressure after the CCI levied a penalty of nearly Rs 6,300 crore on 11 cement companies. ACC, Ambuja Cements, Ultratech, India Cements, Madras Cements, Century Cements, Binani Cements, Lafarge India and Jaypee Cements, all these companies were found in violation of the provisions of the Competition Act, 2002 by the CCI for inflating prices by keeping production low. Cement stocks are the top Nifty losers, Ambuja Cements is down 2.6 percent, ACC loses 1.2 percent.UltraTech Cement is down 2.4 percent. The penalty is more than Rs 6,000 crore and half of the companies’ 2009-10 and 2010-11 profits. he maximum fine was imposed on Jaiprakash Associates at Rs 1,320 crore followed by Aditya Birla Group’s Ultratech Cements. Ambuja Cements has been fined Rs 1,160 crore, while ACC has to shell out Rs 1,150 crore. The companies have been directed to deposit the penalty within 90 days.
Portfolio manager PN Vijay feels that JP Associates will be impacted the most by the Competition Commission of India’s penalty on cement companies due to the already high level of debt on its books.
Stocks leading losses on the Sensex and the Nifty are Infosys (down 1.5 percent), HDFC loses 1.6 percent, ICICI Bank is down 1.3 percent and RIL is down 0.9 percent.
The telecom stocks too are likely to show subdued trend as the much-awaited EGoM meeting headed by Finance Minister Pranab Mukherjee, to finalise a base price for sale of spectrum, was deferred indefinitely.
However, there may be some spurt in retail related stocks, as the Commerce and Industry Minister Anand Sharma has said that political consensus is building over allowing foreign direct investment in multi-brand retail in the next few days.
Stocks in news
Reliance Industries is down 1 percent. Its partners BP and Niko Resources plan to invest $4 billion to develop satellite fields in the D6 block, where the operator is also keen to explore for more hydrocarbons that may lie beneath the fields already under production.
DCNS is likely to pick up a little less than 10 percent equity stake in Nikhil Gandhi-promoted Pipavav Defence and Offshore Engineering for about Rs 800 crore according to Pipavav Defence officials. The stock is up 1.38 percent.
Tata Motors: Division Bench of the Calcutta High Court, comprising Justice Pinaki Chandra Ghose and Justice Mrinal Kanti Chaudhuri, is expected to deliver its verdict on the constitutional validity of the Singur Land Rehabilitation and Development Act, 2011 on Friday.
Hindustan Zinc after the government is likely to reject an offer by the Anil Agarwal-led metals and mining conglomerate Vedanta Resources to buy the residual stakes in group firms Hindustan Zinc Ltd and Bharat Aluminium Co ( Balco) for about Rs 17,000 crore.
The Economic Times reports that Reliance Industries is set to exit its textiles business, Vimal.
Tata Steel’s open offer for Tinplate, priced at Rs 60 per share, and Tata Sponge, and Rs 374 per share, will open on August 7 and close on August 22.
Aegis, Essar Group’s information technology and business process outsourcing arm, is targeting organic growth of 26 % and revenue of $1.25 billion in 2012-13.
A year after the first labour strife at Maruti Suzuki India Limited (MSIL)’s Manesar facility, the car maker is set to face prosecution proceedings by the Haryana government’s labour department for not adhering to the agreement signed with workers at the unit.