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Market Report

Thursday, 19-Dec-2013

NSE

  • After opening with a 100-point rise on firm Asian cues, the Sensex hit day's high of 21,017.45 but the gains proved to be short-lived as nervous investors resorted to selling. It fell by 151.24 points, or -0.73 per cent, to close at 20,708.62 today. The National Stock Exchange index Nifty declined by 50.50 points, or -0.81 per cent, to close at 6,166.65 after touching the day's high of 6,263.75, hit by fears over the impact of the US Fed announcing a cut in its stimulus.

  • The US Federal Open Market Committee yesterday announced a plan to cut monthly bond purchases to USD 75 billion from next month compared to USD 85 billion now, a decision that is expected to cause some volatility in emerging market assets.

  • Finance Minister P Chidambaram tried to calm the sentiments by assuring that the government could take more steps to deal with emerging situation. Yesterday, the Sensex had snapped a six-day falling streak to rise by 248 points after the RBI's surprise decision to maintain a status quo on policy rates.

  • In the currency markets, the rupee was trading lower at 62.18 versus dollar. The dollar climbed against most of its 16 major counterparts after the US Fed's taper decision. Asian markets ended mixed with Japan's benchmark index Nikkei leading the gains. European markets extended gains after the US Fed signalled that low interest rates would prevail.

  • Benchmark shares indices ended lower today amid fears that foreign institutional investors (FIIs) would reduce their allocations to emerging markets including India thereby hurting incremental inflows after the US Federal Reserve Bank announced gradual reduction in its monetary stimulus measures. But ground situation was exactly the opposite with heavy FII inflows in the last two days. See our "Market Statistics" page.

  • The US tapering is a very good news for Asian equities, says Jim Walker of Asianomics. I would say this is the best news that we have heard in Asia for a long time because what is going to happen is that people are going to start refocusing on fundamentals, economic growth and corporate earnings and stop worrying about the free money flow, Jim says.

NIFTY 3-Month

(Data/Charts courtesy NSEI/Yahoo!/iCharts/The Economic Times)