Sensex dives 651 pts on panic selling; ITC, ICICI down 5%

03 Sep 2013

1

There was complete chaos in market in the last hour of trade Tuesday with the equity benchmarks falling 4 percent on downgrade fears, rupee depreciation and Syria tensions.

There was a statement from the Russian defence ministry that it detected two ballistic "objects" that were fired towards the eastern Mediterranean from the central part of the sea that spooked the market.

However, Israel clarified that it carried out joint missile test with US in Mediterranean and tested 'Anchor' target missile used in anti-missile system.

The Sensex snapped four-day winning streak today, falling 651.47 points or 3.45 percent to close at 18234.66, and the Nifty lost 213.75 points or 3.85 percent at 5337. Declining shares outnumbered advancing ones by 1465 to 795 on the Bombay Stock Exchange.

After such a heavy fall due to continuing global and local issues, experts are finding it difficult to see the real bottom for the market now. They expect further correction going ahead.

Dipan Mehta, Member BSE & NSE says the bottom level is hard to predict as long as this negative news flow continues.

According to him, an action on significant increase in diesel prices or exports could change the direction of the market.

Next two-three weeks are very important for the market and everyone should watch out for RBI policy in September. In the meantime, one should brace for further corrections, Mehta adds.

Goldman Sachs also joined the series of rating agencies downgrade along with JP Morgan & HSBC while Standard & Poor's sent a warning of downgrade.

Goldman Sachs sharply cut India's GDP forecast to 4 percent from 6 percent for FY14 and to 5.4 percent from 6.8 percent for FY15, reports Reuters.

Goldman says the downgrade reflects the more difficult external funding conditions for Asia as markets increasingly anticipate Fed tapering and eventual exit from unconventional monetary policies.

The investment bank has also put out more bearish forecasts for the rupee, expecting the currency to trade at 70 in three months, at 72 in six months and back to 70 in 12 months.

Indian rupee was heading towards its record low of 68.80 per dollar touched on August 28. It was down 211 paise to 68.11 against the US dollar at 16:40 hours IST.

4:00 pm Market closing: The market crashed in late afternoon trade on fears of Syria attack, downgrades and heavy profit booking. Facing severe selling pressure, the Sensex ended at 18234.66, down 651.47 points or 3.45 percent while the Nifty was down 213.75 points or 3.85 percent at 5337.00.

About 795 shares have advanced, 1465 shares declined, and 141 shares are unchanged.

Banking, oil & gas, FMCG, capital goods, realty stocks were hurt the most. Coal India and M&M are top gainers in the Sensex while Hero MotoCorp, Reliance , ITC , ICICI Bank and Bharti Airtel are top losers in the Sensex.

YES Bank lost around 9 percent.

3:50 pm PM's assurance on coal scam: After facing the opposition heat over missing coal scam files, Prime Minister Manmohan Singh on Tuesday finally spoke in Parliament, saying the government has nothing to hide. Promising an investigation to locate the missing coalgate files, he said that anyone found guilty would be punished.

Pointing out that over 1 lakh files had already been handed over, he said the government was willing to co-operate. He said the Opposition should not draw hasty conclusions and should allow Parliament to function.

"The government will follow the SC order in action. Government will hand over the files in the stipulated time. Incase the government is unable to provide some documents, we will act according to the instructions," the Prime Minister said.

3:35 pm Buzzer: The Ministry of Environment and Forests (MoEF) has slapped a penalty of Rs 200 crore on Adani Ports & SEZ. The stock slumped around 6 percent to close at Rs 122 on  BSE.

According to the environment ministry, while developing Mundra Port, Adani Port had actually destroyed some of the mangroves and creek area in that particular region due to which a committee had been set up that was looking into this particular case.

The money from the penalty will have to put in an escrow account over some period of time so that there is no immediate hit on the company.

3:20 pm Market expert: Deven Choksey, KR Choksey Securities believes the Nifty will not break 5100 if the new Reserve Bank of India (RBI) Governor gives more preference to growth than inflation though rate interests will not be lowered immediately.

In an interview to CNBC-TV18 Choksey says the algo trade in the system triggered the system and let to the heavy sell-off by investors which resulted in the market suffering a bloodbath today.

The market is profusely bleeding as the Sensex crashed 681 points, or 3.60 percent at 18205.31. The Nifty loses 216.85 points or 3.91 percent at 5333.90. About 749 shares have advanced, 1410 shares declined, and 134 shares are unchanged.

The market was trending weak mid session onwards but the last hour of trade saw escalation in the Syria stand-off. There were statements from the Russian defence minister that two missiles were detected heading to the east Mediterranean coast which spooked the market further.

Goldman Sachs joins the downgrading bandwagon, sharply cutting India's GDP forecast to 4 percent from 6 percent for FY14 and to 5.4 percent from 6.8 percent for FY15.

Goldman says the downgrade reflects the more difficult external funding conditions for Asia as markets increasingly anticipate Fed tapering and eventual exit from unconventional monetary policies. S&P has a "BBB-minus" rating on India with a "negative" outlook . A downgrade would push Asia's third largest economy to "junk" status.

03:00pm Heavyweights in bear grip
ICICI Bank , Reliance Industries and ITC dropped more than 5 percent while HDFC, Larsen & Toubro, HDFC Bank lost 4 percent each.

Hero MotoCorp is the biggest loser in the Sensex, falling more than 6 percent.

Three stocks are declining for every share advancing on the National Stock Exchange. BSE Midcap Index fell 1.5 percent and Smallcap declined 0.83 percent.

However, Coal India gained 2 percent on buyback buzz.

02:55pm Market recovers a bit
The Sensex recovered more than 100 points from day's low and the rupee too from an intraday low of 68.05 per dollar.

The Sensex is down 476.29 points or 2.52 percent at 18409.84, and the Nifty is down 159.65 points or 2.88 percent at 5391.10 while the rupee fell 195 paise to 67.95 against the US dollar.

Experts believe the call writers are active in the market.

02:45pm Fears of downgrade
JP Morgan, HSBC and Goldman Sachs downgraded India on sharp rupee depreciation and weak macros.

Standard & Poor's considers chances of a credit ratings downgrade for India higher than for Indonesia, Bloomberg News reported today, citing comments made by an analyst of the credit rating agency at a briefing in Seoul, reports Reuters.

S&P has a "BBB-minus" rating on India with a "negative" outlook. A downgrade would push Asia's third largest economy to "junk" status.

02:35pm Expert talks
Equity benchmarks and rupee fell 3 percent each. Brent crude rose 0.93 percent to USD 115.39 a barrel after Russian defence ministry says that it detected 2 ballistic objects fired towards Eastern Mediterranean, reports Reuters.

Deven Choksey, KR Choksey Securities believes if the Indian market breaks the 5,450 level on the Nifty then it may once again head in the direction of 5,200-5,250. According to him, the Nifty will not break 5100 if the new Reserve Bank of India (RBI) Governor gives more preference to growth than inflation though rate interests will not be lowered immediately.

The rupee plunged 203 paise to 68.03 against the US dollar.

Meanwhile, Cairn India rallied 2.5 percent on rise in crude oil prices.

02:25pm Market Update
The market hit the low point of the day on profit booking after seeing a short covering in previous four sessions. The Nifty broke the 5400 level on weakness in banks, oil & gas, FMCG and capital goods.

The Sensex is down 446.21 points or 2.36 percent at 18439.92, and the Nifty is down 154.95 points or 2.79 percent at 5395.80.

The rupee dropped 164 paise to 67.64 against the US dollar.

02:15pm Downgrades begin
Goldman Sachs joins the downgrading bandwagon, sharply cutting India's GDP forecast to 4 percent from 6 percent for FY14 and to 5.4 percent from 6.8 percent for FY15, reports Reuters.

Goldman says the downgrade reflects the more difficult external funding conditions for Asia as markets increasingly anticipate Fed tapering and eventual exit from unconventional monetary policies.

Investment bank also puts out more bearish forecasts for the rupee, expecting the currency to trade at 70 in three months, at 72 in six months and back to 70 in 12 months.

"We think that there could be some risks of near-term overshooting of our targets if economic and financing conditions worsen, and especially if there are pressures on the banking and corporate sectors due to weakness in growth," it said.

02:05pm The market fell further in afternoon trade, losing more than 2 percent on steep fall in domestic currency. The rupee fell 161 paise to 67.61 against the US dollar.

The Sensex is down 384.79 points at 18501.34, and the Nifty is down 129.40 points at 5421.35. Declining shares outpaced advancing ones by 1238 to 793 on the Bombay Stock Exchange.

Bankex crashed 4 percent followed by Oil & Gas, FMCG, Realty and Capital Goods with 2-3 percent losses.

According to experts, if the rupee depreciation continues, then the import bill of the country may increase further. India is the net importer of oil.

The government had hiked petrol price by Rs 2.35 per litre and diesel by 50 paise last Saturday, but that is not enough because under-recovery of oil marketing companies are still high.

Lamenting the high fuel subsidy burden, Sudhir Vasudeva, chairman, ONGC , says hiking diesel price is the only option to combat rising fuel prices globally.

Speaking to CNBC-TV18, Vasudeva says the company will be facing a far larger subsidy burden this year (FY14) than it did in FY13. The company paid Rs 49421 crore in FY13 as subsidy burden.

''In Q1 we have got USD 40.17 per barrel after the discounts. Now cost of production for the year 2012-13 is USD 40.08. That means I am getting only 13-14 cents for every barrel of oil production. In that case, how do I survive? Not only do we have to generate funds for sustaining our today's operation but we also have to generate funds for propelling our growth for future. So, now, it is a matter of our survival,'' says Vasudeva.

Additionally, Vasudeva says the upstream company needs a net realisation of atleast USD 65 per barrel and a one-time diesel price hike to be able to combat the rising fuel prices.

1:55 pm Gold outlook: Ram Pitre, Anand Rathi Commodities has a pessimistic view on the yellow metal and sees international gold prices hovering in the range of USD 1,370 - USD 1,415 an ounce today . In the domestic market, one can buy gold at around Rs 32,800-33,000 per 10gm, he told CNBC-TV18 in an interview.

He further added that as we head into the festive season, domestic gold price is likely to touch Rs 34,000-35,000 per 10gm aided bt weak rupee.

1:45 pm Management interview: Speaking to CNBC-TV18, Narendra Murkumbi, VC and MD, Shree Renuka Sugar says that the government's proposal for oil marketing companies to blend 10 percent of ethanol with petrol instead of the current 5 percent can save around Rs 8,000-9,000 crore of foreign exchange which is currently being used to import crude.

It will reduce the sugar surplus by almost one million to one-and-half million tonne and that will be beneficial for the sugar industry. Therefore, it is a benefit in terms of new demand, new market for ethanol and scope to reduce sugar surplus, he adds.

1:35 pm Rupee outlook: The rupee is likely to weaken further and far more efforts are expected from Indian policymakers to stabilise the free-fall seen in the currency, says Dominic Bunning, associate - Fx Strategy, HSBC.

Speaking to CNBC-TV18, Bunnings says the dollar will continue to gain against the emerging market (EMs) currencies .

"The market is increasingly looking for the Fed to stop tapering its QE programme and that is likely to continue to support the dollar," explains Bunning.

1:20 pm Management speaks: With the aviation turbine fuel (ATF) prices touching an all-time high  on Monday, the aviation sector has the option to hike airfares. However, the excess capacity witnessed by carriers will make it tough to raise prices to recover costs. SL Narayanan, group chief financial officer of Sun Group (which owns SpiceJet ) feels the company's margins may be strained in the current quarter with higher fuel prices and low demand.

Meanwhile, he also clarifies on that the Aviation Authority of India (AAI) has not placed it on a cash and carry basis. "All issues with AAI have been sorted', he adds.

The market wiped out early gains on the back of profit taking. The Nifty loses its grip over 5450, at 5415.90 down 134.85 points or 2.43 percent. The Sensex loses 409.33 points or 2.17 percent at 18476.80. About 798 shares have advanced, 1150 shares declined, and 129 shares are unchanged.

The rupee fell sharply, back above 67 to the dollar as foreign banks purchased dollars probably for foreign institutional investors (FII) clients while RBI is not seen supplying dollars.

Financial stocks are beaten out of shape today. BSE Bankex and Bank Nifty are down 3 percent each, while oil and gas, capital goods, FMCG and realty stocks are also extremely weak.

Hero MotoCorp, HDFC , Reliance , ICICI Bank and Hindalco are top losers in the Sensex. Meanwhile, Coal India , Sesa Goa , Tata Motors , Wipro and M&M are outperformers.

13:05pm Rupee Update
The rupee hit an intraday high of 66.27 against the US dollar, down 1.92 percent or 127 paise from previous close. It dropped 2.3 percent in last two trading sessions.

12:59pm TCS Market Cap
The market capitalisation of TCS is higher than Infosys , HCL Technologies and Wipro combined. TCS' current market cap stands at Rs 4 lakh crore while Infosys' market cap is at Rs 1.7 lakh crore, HCL Tech at Rs 71,700 crore and Wipro at Rs 1.2 lakh crore.

Country's largest software services provider's market cap is also 40 percent higher than Reliance Industries that has market cap of Rs 2.75 lakh crore.

12:50pm India Volatility Index increased 9.66 percent to 30.21 in afternoon trade.

Power Grid Corporation shares fell 3.6 percent. The government will divest five percent stake in the company via follow-on public offer, reports CNBC-TV18 quoting finance ministry sources.

It is learnt that cabinet will consider Coal India issue in 2 weeks. The company will give special dividend if buyback not cleared, say sources.

12:40pm Gainers & Losers
Index heavyweight Reliance Industries extended losses from 1.5 percent to 3.6 percent while HDFC and Hero MotoCorp are top losers in the Sensex, falling 4.5 percent each.

Top private sector lenders ICICI Bank and HDFC Bank lost 2.8 percent each.

Major largecaps like ITC , Infosys, HUL , Sun Pharma , L&T and Bharti Airtel declined 2-3 percent.

However, Tata Motors , Coal India, Sesa Goa and BHEL are outperformers, gaining 1-2 percent.

12:20pm Rupee Update
The rupee depreciation continues, falling 121 paise to 67.21 against the US dollar in afternoon trade on top of 30 paise decline in previous session. Last week it had seen a relief rally of more than 300 paise after hitting a record low of 68.80 per dollar.

The rupee is likely to weaken further and far more efforts are expected from Indian policymakers to stabilise the free-fall seen in the currency, says Dominic Bunning, associate - Fx Strategy, HSBC.

Speaking to CNBC-TV18, Bunnings says the dollar will continue to gain against the emerging market (EMs) currencies.

"The market is increasingly looking for the Fed to stop tapering its QE programme and that is likely to continue to support the dollar," explains Bunning.

The Sensex is down 350.44 points or 1.86 percent at 18535.69, and the Nifty is down 117.70 points or 2.12 percent at 5433.05. Declining shares outnumbered advancing ones by 1090 to 831 on the Bombay Stock Exchange.

Meanwhile, European markets were flat in opening trade today.

12:05pm It is a weak day for the market after four positive sessions. The Sensex is down 247.32 points or 1.31 percent at 18638.81, and the Nifty is down 86.50 points or 1.56 percent at 5464.25.

Bank Nifty tanked 215 points to 8925 level on fresh shorts build up in noon trade. Country's largest lenders ICICI Bank and HDFC Bank lost 2-2.6 percent.

Housing finance major HDFC and two-wheeler major Hero MotoCorp are top losers in the Sensex, down 4-5 percent. Even FMCG stocks like ITC and HUL fell 1.5 percent on profit booking.

Meanwhile, Indian rupee dropped 86 paise to 66.86 against the US dollar, continuing fall for the second consecuive session today.

Mark Mobius, executive chairman, Templeton Emerging Markets Group expects the Indian rupee to pullback from its current levels shortly.

He says the worst is now over for Indian equity market. "The currency has moved probably too far and we have a situation where there could be a pullback on the currency. It's been a combination of all kinds of hedge funds and other derivative instruments that have played a big role in this dramatic decline of the rupee and that is probably over," he highlights.

Speaking to CNBC-TV18, Mobius says the government needs to step into an active zone and start focusing on boosting the economic sentiment and strengthening the rupee. Mobius' statement comes at a time when most macros, including the GDP growth , are not in favour of the country.

11:55 am Udayan's comments: Nifty's rally from 5,100 to 5,400 has taken many market participants by surprise. Since market's movement is not governed by fundamentals, so the Nifty can hit 5,600 and even stretch to 5,700 on short covering and additions of long positions, says Udayan Mukherjee of CNBC-TV18.

"There could easily be another 100 odd points on the Nifty left from here, but you are overstaying your welcome if you are pushing it beyond that point," he cautioned.

11:45 am Big interview: Mark Mobius, executive chairman, Templeton Emerging Markets Group expects the Indian rupee to pullback from its current levels shortly.

He says the worst is now over for Indian equity market. "The currency has moved probably too far and we have a situation where there could be a pullback on the currency. It's been a combination of all kinds of hedge funds and other derivative instruments that have played a big role in this dramatic decline of the rupee and that is probably over," he highlights.

11:35 am FIIs buy: Foreign institutional investors turn net buyers in the secondary share market after 11 consecutive sessions of selling a total of about USD 1 billion, reports Reuters.

Overseas investors, who have been net buyers of Indian shares so far in 2013, have sold the same in each of last 3 months weighed by a record low rupee, persisting worries on fiscal deficit and a policy flip-flop amid a slowing economy.

11:20 am Buzzer: Radico Khaitan shares were locked at 5 percent upper circuit at Rs 125.70 in morning trade on a 26 percent stake sale buzz.

A media report said that the India's fourth largest liquor maker, has begun preliminary talks to sell a minority stake to Japan's oldest liquor company Suntory Holdings. According to the report, the Japanese spirits major is expected to pay close to Rs 870 crore for the stake, valuing Radico Khaitan at Rs 3,500 crore. Its current market capitalisation stands at Rs 1,671.13 crore.

The market is growing weak with the Nifty hovering around 5500. The Nifty is at 5502.45, down 48.30 points or 0.87 percent while the Sensex is down 121.10 points or 0.64 percent at 18765.03.  About 803 shares have advanced, 758 shares declined, and 118 shares are unchanged.

However, midcap and smallcap stocks are outperforming peers. Financials and oil & gas stocks are under pressure. BHEL , Tata Motors , ONGC , Jindal Steel and Coal India are top gainers in the Sensex. On the losing side are HDFC, Hero MotoCorp, HDFC Bank , Reliance and ICICI Bank .

Meanwhile, Asian markets extend yesterday's gains. In other asset classes, gold slipped for the fourth session as Syrian worries took a back seat.

Brent trades stable at USD 114 levels. The dollar index continued to gain hitting a one-month high against the yen.

10:55am Buzzers
Radico Khaitan shares surged 5 percent on a media report that the company has begun preliminary talks to sell a minority stake of 26 percent to Japan's oldest liquor company Suntory Holdings for Rs 870 crore. This deal values the company at Rs 3500 crore, higher than its current market capitalisation of Rs 1600 crore.

Jubilant Foodworks rose 1.5 percent. Goldman Sachs says that Jubilant could be USD 3.1 billion in five years and USD 7.4 billion in 10 years as against current market cap of USD 1 billion. The brokerage house has maintained its buy rating on the stock with a target price of Rs 1409.

10:50am NTPC - Management Interview

National Thermal Power Corporation Ltd (NTPC) will bid for ultra mega power projects (UMPPs) whenver government awards such projects, says CMD Arup Roy Choudhury.

The state-run company is likely to bid for UMPPs worth Rs 20,000 crore each in Odisha and Tamil Nadu .

In an interview to CNBC-TV18 Choudhury says the company's coal imports are progressing on track and its FY14 capex plans stand at Rs 20,200 crore.

10:45am Losers & Gainers
IndusInd Bank , HDFC and Hero MotoCorp are biggest losers in the Nifty, falling 4 percent each followed by Sesa Goa and Reliance Industries with 2-3 percent losses.

However, BHEL and Tata Motors topped the buying list, rising 2-2.7 percent. Lupin and ONGC gained 1.6 percent each.

The Sensex is down 150.98 points or 0.80 percent at 18735.15, and the Nifty is down 52.15 points or 0.94 percent at 5498.60.

10:35am Bank Nifty down 9 percent in past one month

Siddharth Bhamre of Angel Broking is not expecting Bank Nifty to be a very big outperformer.

"I am not very optimistic on that front as I was mentioning that FIIs have more of short positions in index futures and especially Bank Nifty where rollovers have been high and month-on-month, there has been rise in open interest (OI) also. We have not seen any signs of short covering. There are no visible triggers for short covering either. So, I am not expecting Bank Nifty to be a very big outperformer as such, but because this would be a stock specific market, we may see some consolidation," Bhamre said.

10:25am Expert Talks
The market recovered some of its losses from day's low with the Nifty reclaiming 5500 level, supported by short covering in private financials and Reliance Industries.

The Sensex is down 120.47 points at 18765.66, and the Nifty is down 43.50 points at 5507.25.

Neelkanth Mishra, Head of Equity Strategy India at Credit Suisse says that the firm cannot write-off India story due to currency crisis.

According to him, the rupee will strengthen over next few months. FIIs will find it difficult to pull money out of Indian equities, he adds.

"We may see further earnings growth downgrades going ahead. The rupee depreciation impacts financials the most while earnings estimate for IT and pharma may be revised upwards," Mishra says.

10:10am The market lost ground in morning trade Tuesday with the Nifty falling below the 5500 level, weighed down by private financials, FMCG, healthcare and technology stocks. Index heavyweight Reliance Industries slipped more than 2 percent.

The Sensex is down 201.54 points or 1.07 percent at 18684.59, and the Nifty is down 64.70 points or 1.17 percent at 5486.05, but the broader markets are flat.

Private financials are taking major beating; HDFC crashed nearly 4 percent. ICICI Bank and HDFC Bank declined 2 percent each while their rival State Bank of India gained 0.4 percent.

Meanwhile, the rupee fell another 84 paise to 66.84 against the US dollar after losing 30 paise in previous session. Last week it had gained more than 300 paise in two sessions from its record low of 68.80 per dollar.

"I am not as bearish as other people. I am not so concerned about the market. The issue is for dollar investor, he is getting a raw deal as the rupee gets weaker. The non-deliverable forwards (NDFs) and the covers have gone out of control," Pashupati Advani of NBIE told CNBC-TV18 in an interview.

However for rupee investors with a long-term time horizon, this is the time to buy on dips, he recommended.

10:00 am Market level: The market is under selling pressure, as the Sensex is down 100.07 points or 0.53 percent at 18786.06, and the Nifty is at 5512, down 38.30 points or 0.69 percent. About 560 shares have advanced, 518 shares declined, and 78 shares are unchanged.

Some financial stocks are growing weak, with HDFC twins as major losers in the Sensex. Hero MotoCorp, Reliance , ICICI Bank are other weaklings.  Tata Motors , BHEL , Sesa Goa , Coal India and ONGC are top gainers in the Sensex.

9:50 am Gainer: Deutsche Bank has a buy rating on Mahindra & Mahindra Financial Services. The brokerage house also raised its target price on the stock to Rs 290 from Rs 265 apiece earlier.

"Good monsoons have raised the prospect of strong non-performing liabilities (NPL) recoveries post the festive season in the second half of FY14. This should help lower NPLs by end of the year," Deutsche Bank report said.

9:45 am Buzzer: Shares of Jubilant Foodworks gained 2 percent in early trade Tuesday on buying interest. Goldman Sachs maintained its buy rating on the stock, adding the stock to its conviction list.

"We see potential for Jubilant Foodworks to rise to a USD 7.4 billion valuation in 10 years. We expect the company to add over 1,800 outlets while growing same-store-sales by 12 percent in 10 years as against 5.4 percent currently priced in," Goldman Sachs report said.

9:30 am Market outlook: Though a lot of people are sitting on the sidelines given the global uncertainty, Pashupati Advani of NBIE is hopeful the market will not fall off the cliff and the Nifty will stay above 5000 levels.

"I am not as bearish as other people. I am not so concerned about the market. The issue is for dollar investor, he is getting a raw deal as the rupee gets weaker. The non-deliverable forwards (NDFs) and the covers have gone out of control," he told CNBC-TV18 in an interview.

However for rupee investors with a long-term time horizon, this is the time to buy on dips, he recommended. Unlike most market experts, Advani is not too gung-ho on technology stocks. But he is confident on India's consumption theme.

Cigarette major ITC is his old favourite and remains so. He is also positive on oil marketing companies (OMCs).

The market opened on a strong note but soon turned flat. The Sensex is up 14.79 points or 0.08 percent at 18900.92, and the Nifty is down 1 point or 0.02 percent at 5549.75. About 424 shares have advanced, 132 shares declined, and 30 shares are unchanged.

Stock specifically, Bharti Airtel , BHEL, Tata Motors and Coal India are lead gainers in the Sensex.

The Indian rupee opened at 66.28 per dollar versus 66 yesterday.

The dollar index gained to 82.3 levels, while the euro slipped a bit and the yen was at a one-month low nearing 100/USD.

NS Venkatesh, IDBI Bank said, "Expect markets to strengthen on the back of receding geopolitical risk from Syria and strengthening equity markets across Asia. The range for the rupee is seen between 65.10-65.80/USD."

Meanwhile, in the global front Asian markets gained for the second day on back of upbeat factory data around the globe, while a delay in a potential US strike on Syria diminished the safe-haven appeal of gold and the yen. MSCI's index of Asia-Pacific shares outside Japan added 0.3 percent, building on Monday's 1.2 percent rise and Japan's Nikkei stock average added 1.9 percent.

European markets stage nearly a 2 percent rally across the board buoyed by positive manufacturing data and the Vodafone-Verizon deal. The USD 130 billion deal was completed shortly after the close of markets. What also aided sentiment was the strong chinese and European factory data which boosted hopes that the global economy is growing out of stagnation.

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