Sensex Falls 84 Points Amid Volatile Trading Post Fed Rate Hike

Sensex fell 84 points and Nifty settled at 8,154 in a volatile session after US Federal Reserve raised interst rates by 25 basis points and hinted at a faster pace of interest rate hikes going ahead.

The Sensex staged a gap down opening wherein it fell 200 points but buying in IT shares on the back of dollar strength helped the benchmark indices recover losses. For rest of the day Sensex and Nifty flip-flopped between gains and losses owing to weakness in pharma, FMCG and auto shares.

The Sensex ended 84 points lower at 26,519 and Nifty declined 29 points to settle at 8,154.

From the Nifty basket of shares, 32 ended lower while 19 closed higher.

Sun Pharma was the top Nifty loser, down 4.2 per cent to close at Rs 650. Tata Motors, NTPC, Bosch, ITC, Eicher Motors, Bharti Airtel, Yes Bank, Cipla, Tata Power and Hindustan Unilever were also among the losers.

On the other hand, TCS was among the top Nifty gainers, the stock ended 2.34 per cent higher to settle at Rs 2,259. Axis Bank, ONGC, Bank of Baroda, State Bank of India and Tata Steel were also among the gainers.

The broader markets ended on a muted note with mid-cap index closing unchanged while small-cap index advancing 0.2 per cent.

The overall market breadth was neutral as 1,312 stocks ended higher while 1,291 closed lower on the BSE.

3:07 p.m.: Stock markets trade with a negative bias. Sensex falls 80 points to 26,522 and Nifty declines 29 points to 8,153.

2:57 p.m.: Gitanjali Gems shares surged 10 per cent after its subsidiary Nakshatra World notified the decision of raising up to Rs. 650 crore through an IPO.

On BSE, the stock opened at Rs. 65.20 and soared 9.89 per cent to touch an early high of Rs. 68.85.

1:50 p.m.: NALCO was the top loser from the mid-cap space, down 7 per cent to Rs 61.50. Bajaj Finserv, 3M India, Apollo Hospitals, Castrol India, HPCL, Bajaj Holdings, Bayer Cropscience, Jindal Steel and Aditya Birla Nuvo were also among the laggards.

1:40 p.m.: The Sensex and Nifty were trading in a narrow range in afternoon deals. The Sensex was up 33 points at 26,636 and Nifty was at 8,187, up 5 points.

1:30 p.m.: Oil & gas shares witness selling pressure. The BSE Oil & Gas index falls 0.3 per cent; HPCL, Castrol India, Oil India, Bharat Petroleum, GAIL India, Petronet LNG and Reliance Industries were among the laggards.

1:21 p.m.: IT stocks continue to trade on a strong note on the back of strength in US dollar after US Fed decided to hike interest rates by 25 basis points. The BSE IT index surges 1.5 per cent; TCS, Infosys, HCL Technologies, Wipro, Tech Mahindra and OFSS were among the top movers.

1:10 p.m.: Shares Gitanjali Gems surged as much as 10 per cent to hit intraday high of Rs 68.85 after the company reported 38 per cent jump in the net profit in the second quarter. The company's net profit in Q2 came in at Rs 22.35 crore compared with Rs 16.11 crore during the same quarter last year.

12:36 p.m.: From the Nifty basket of shares, 22 were advancing while 29 were declining. Sun Pharma was the top Nifty loser, down 2 per cent at Rs 665. Tata Motors, Ambuja Cements, Bharti Airtel, ITC, Cipla, ICICI Bank and Hindustan Unilever were also among the laggards.

12.20 p.m.: ONGC shares trade 0.29 per cent lower at Rs 202.95. ONGC shares turned ex-bonus today. The company had declared bonus shares in the ratio of 1:2, which means shareholders will get one bonus share for every two ONGC share held in their demat account. Record date for considering the entitlement of shareholders to get the bonus shares is December 16, 2016. 

11:54 a.m.: The market breadth was neutral as 1,185 stocks were advancing while 1,097 were declining.

11:42 a.m.: The stock markets edged lower in early noon deals on the back of weakness in oil & gas, FMCG and pharma shares. The Sensex was down 65 points at 26,538 and Nifty was at 8,162, down 20 points.

11:39 a.m.: Shares of liquor makers such as Globus Spirits, Pincon Spirit, Radico Khaitan and United Spirits fell as much as 7 per cent after the Supreme Court ordered closure of liquor shops along the national and state highways.

Indian made foreign liquor maker Globus Spirits fell as much as 6.85 per cent to Rs 90.35. It was followed by Pincon Spirit (fell 3.14 per cent), Radico Khaitan (fell 3.11 per cent) and United Spirits (fell 1.6 per cent) after Supreme Court ordered closure of liquor shops along highways.

10:50 a.m.: Broader markets trade with a positive bias. The BSE mid-cap index jumps 0.4 per cent and small-cap index rises 0.73 per cent. Alankit was the top gainer from the small-cap space, up 10.3 per cent at Rs 35.40. Nectar Lifesciences, Swan Energy, Ujaas Energy, Deccan Gold Mines, Ramco Systems, Hathway and Sonata Software were also among the gainers.

10:43 a.m.: Shares of Cipla jumped as much as 1.5 per cent to hit intraday high of Rs. 576 after the pharma company announced that it has entered into joint venture with Iran's Ahran Tejarat Company to manufacture pharma products in Iran.

Cipla in a stock exchange filing said that the joint venture was done via it's subsidiary in Netherlands and Cipla Netherland will hold 75 per cent stake in the JV.

10:10 a.m.: IT shares continue to lead the market rally in morning deals. The BSE IT index advances 1.7 per cent led by gains in Infosys, TCS, HCL Technologies, Wipro, Tech Mahindra, KPIT Cummins and OFSS.

9:30 a.m.: Sensex fell nearly 200 points while the 50-share Nifty opened below its crucial psychological level of 8,150 after the US Federal Reserve hiked interest rates by 25 basis points and hinted at a faster pace of interest rate hike going ahead.

However, the benchmark indices recovered from intraday lows on the back of buying in IT stocks due to strong dollar against the Indian rupee. Buying in oil & gas shares also supported the gains.

Analysts say rate hike in US would lead outflow of money from emerging market equities like India into US bonds which are considered as safer investment options.

Meanwhile, other Asian share markets were also trading on a weak note following Federal Reserve's deciscion to raise interest rates. Hong Kong's Hang Seng slumped 1.8 per cent, Japan's Nikkei was down 0.2 per cent and China's Shanghai Composite fell 0.29 per cent.

Back home, selling pressure was visible banking, metal, FMCG, auto and real estate shares.

From the Nifty basket of shares, 32 were trading lower while 19 were advancing.

Infosys, HCL Technologies, Cipla, BPCL, TCS, Mahindra & Mahindra and State Bank of India were among the gainers in the Nifty.

9.00 a.m.: Rupee opens lower at 67.80 per dollar against Wednesday's close of 67.43.

8.40 a.m.: Indian equity markets are set to open with big cuts on Thursday after the US Federal Reserve raised interest rates for the first time in a year and hinted at the risk of a faster pace of tightening than investors were positioned for. Nifty futures trading on Singapore Exchange were down 66 points or 0.80 per cent at 8,119 as of 8.25 a.m.. 

Meanwhile, Asian shares and currencies traded lower on Thursday and the US dollar was near 14 year high after yields on short-term US debt surged to the highest since 2009. Hang Seng slumped 1.88 per cent, Kospi fell 0.32 per cent, Nikke down 0.15 per cent and the Shanghai Composite index traded 0.39 per cent lower. 

Overnight, Wall Street suffered its biggest percentage decline since the Nov. 8 U.S. presidential election, though the loss was slight compared with gains of the last month or so. The Dow ended down 0.6 per cent, while the S&P 500 lost 0.81 per cent and the Nasdaq 0.5 per cent.  

The US Fed raised interest rates by 25 basis points to 0.5-0.75 per cent yesterday, which was almost factored in by the Street. However, investors were spooked when the "dot plots" of members' projections showed a median of three hikes next year, up from two previously. 

Some analysts note that the change came even as the Fed's economic projections have hardly been upgraded, suggesting the Fed could accelerate tightening even further if policymakers see firmer evidence of higher growth or inflation.  

Back home, sentiment is likely to be weak as foreign investors continued to be sellers of Indian equities. Yesterday they sold cash shares worth Rs 632 crore, though domestic investors were net buyers to the tune of Rs 211 crore. 

Among individual stocks, Cipla, Bajaj Auto, ONGC will be in focus today. Cipla has entered into a joint venture with Ahran Tejarat Company of Iran via its Netherland arm, which will hold 75 per cent stake in the joint venture (JV) entity. The JV will manufacture pharma products in Iran. 
Meanwhile, Bajaj Auto will launch its 400cc motorcycle, Dominar400 today, which will compete with Eicher Motors' Royal Enfield. 

On the other hand, ONGC goes ex-bonus in the ratio of 1:2 today.  

(With inputs from Reuters)