Equity benchmarks failed to sustain
record highs in late trade on Monday due to crash in metals stocks after
Supreme Court verdict on coal block allocation case. Banks too put pressure on
the market but the buying in defensives like technology and FMCG played
supportive role.
The 30-share BSE Sensex rallied as
much as 211 points intraday to hit a record high of 26630.74 but could not
sustain the same, up 17.47 points to close at 26437.02. The 50-share NSE Nifty
managed to hold the 7900 level, down 6.90 points to 7906.30 after hitting an
all-time high of 7,968.25. The broader markets underperformed with the BSE
Midcap and Smallcap indices falling 0.4-0.6 percent.
Looking at the current upward momentum,
experts believe the market may extend upmove, may be till 8000 level on the
Nifty by August series expiry but they advise some profit-taking at these
levels.
On the stocks front, the Supreme Court (SC)
verdict on coal block allocation case hammered metals and select power stocks.
SC held terms of allotment of coal blocks as illegal but stopped short of
deallocating coal blocks. "Blocks awarded via screening panel since 1993
were illegal. No objective criteria was followed in allocations and guidelines
were breached in coal block allocations," says the court in its order,
adding it will decide consequences of illegality on September 1.
The BSE Metal Index crashed 4.3
percent as Jindal Steel plunged 14 percent and Hindalco Industries lost 9.6
percent. Tata Steel tanked 4.8 percent and Sesa Sterlite was down 3.9 percent.
Reliance Power slipped 4 percent as the court disallowed exploitation of
captive mines by ultra mega power projects.
In other order, Supreme Court stayed
the electricity appellate tribunal Aptel’s interim order on compensatory
tariff, which allowed Tata Power (down 3.4 percent) and Adani Power (down 4
percent) to charge hiked tariff from March 2014. The apex court asked the
tribunal to hear the matter expeditiously.
Among others, top private sector
lender ICICI Bank was down 1.5 percent and its rival Axis Bank fell 1.2 percent.
However, defensives supported the
market with the BSE FMCG and IT indices rising a percent each. ITC and
Hindustan Unilever were up 1.6 percent and 1.8 percent, respectively.
Top software services exporter TCS
and drug maker Dr Reddy’s Labs gained over 2 percent. Shares of HDFC, Mahindra
and Mahindra, Maruti Suzuki, Hero Motocorp, Bharti Airtel, Cipla and BHEL
advanced 1-1.9 percent.
Shree Cements (after market hours)
said it will acquire 1.50 million tonne per annum cement grinding unit (located
at Panipat) of Jaiprakash Associates for Rs 360 crore. Shree Cements fell 2
percent and JP Associates closed flat.
In the broader space, Alstom T&D
gained 5.5 percent on (joint venture) bagging order worth Rs 3,250 crore while
Arvind continued its rally, up 6 percent to end at record closing high of Rs
271.30.
Declining shares outnumbered advancing ones by
a ratio of 1630 to 1388 on the Bombay Stock Exchange.
On the global front, European
markets like France's CAC and Germany's DAX gained 1 percent each (at 16:15 hours
IST) on hopes of fiscal stimulus after a speech by Mario Draghi, the president
of the European Central Bank, who delivered a dovish tone on Friday in Jackson
Hole meeting. Asian markets closed mixed with the China’s Shanghai falling 0.5
percent and Nikkei up 0.5 percent.
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