BSE Sensex Nifty, struggling to stay firm: Thursday Closing Report

There is no short-term direction so far but the medium-term downtrend is intact

The local market settled marginally lower, snapping the two-day winning streak, on weak global cues and a sell-off in consumer durables, auto and capital goods stocks. The market indices are struggling to stay firm. While there is no short-term direction so far, the medium-term downtrend is intact. The National Stock Exchange (NSE) reported a volume of 81.55 crore shares and advance decline ratio of 695:1018.


The market witnessed a flat opening weighed down by unsupportive global cues. Markets across Asia were seen lower despite the Bank of Japan announcing a hike in its asset buying and lending programme as talks to avoid a “fiscal cliff” in the US ended in a stalemate. Markets in the US settled in the red overnight as talks on a budget deal failed.


The Nifty opened four points higher at 5,934 and the Sensex started the day at 19,511, up 35 points over its previous close. The market hit its intraday high in initial trade with the two benchmarks rising to 5,938 and 19,521, respectively.


Profit booking after two days of gains pushed the market into the negative terrain a short while later. The decline expanded with most sectoral indices trading lower. The market fell to its lows in mid-morning trade wherein the Nifty touched 5,881 and the Sensex went back to 19,336.


The benchmarks were range-bound in the negative in the remaining part of the first half in the absence of any local triggers and selling pressure from heavy weights. Buying in metals, fast moving consumer goods and healthcare stocks helped the market bounce back from the lows in post-noon trade.  However, the push lacked strength, which kept the indices marginally in the red till the end of the trading session.


The Nifty closed 13 points (0.22%) down at 5,916 and the Sensex fell 22 points (0.11%) to 19,453.


The broader indices underperformed the Sensex today. The BSE Mid-cap index fell 0.21% and the BSE Small-cap index declined 0.38%.


The sectoral gainers were BSE Metal (up 1.19%); BSE TECk (up 0.34%); BSE IT (up 0.26%) and BSE Fast Moving Consumer Goods (up 0.13%). The top losers were BSE Consumer Durables (down 0.97%); BSE Auto (down 0.76%); BSE Capital Goods (down 0.72%); BSE Power (down 0.56%) and BSE Realty (down 0.47%).


Fifteen of the 30 stocks on the Sensex closed in the positive. The chief gainers were Hindalco Industries (up 2.59%); Jindal Steel & Power (up 2.27%); Tata Steel (up 1.90%); Hindustan Unilever (up 1.55%) and TCS (up 1.27%). The losers were led by Sun Pharmaceutical Industries (down 1.99%); Mahindra & Mahindra (down 1.68%); Bajaj Auto (down 1.37%); Wipro (down 1.37%) and Larsen & Toubro  (down 1.02%).


The top two A Group gainers on the BSE were—SJVN (up 3.90%) and Colgate Palmolive (up 3.55%).

The top two A Group losers on the BSE were—Adani Enterprises (down 6.98%) and Adani Power (down 4.46%).


The top two B Group gainers on the BSE were—Alchemist Realty (up 20%) and TVS Electronics (up 19.89%).

The top two B Group losers on the BSE were—Mahanivesh India (down 19.98%) and Trio Mercantile Trading (down 19.89%).


Out of the 50 stocks listed on the Nifty, 14 stocks settled in the positive. The major gainers were Jindal Steel & Power (up 2.46%); Hindalco Ind (up 2.39%); Tata Steel (up 1.74%); HUL (up 1.72%) and TCS (up 1.53%). The key losers were Ambuja Cement (down 3.10%); Sun Pharma (down 2.68%); BPCL (down 2.14%); Jaiprakash Associates (down 2.08%) and Cairn India (down 1.89%).


Markets in Asia settled higher following the Bank of Japan’s move to increase asset purchases. On the other hand, some markets settled lower on concerns about the economic stability of the US, the world’s top economy.


The Shanghai Composite gained 0.28%; the Hang Seng rose 0.16.%; the KLSE Composite climbed 0.30%; the Straits Times advanced 0.54% and the Seoul Composite settled 0.32% up. On the other hand, the Jakarta Composite declined 0.49%; the Nikkei 225 tanked 1.19% and the Taiwan Weighted dropped 1.07%.


At the time of writing, two of the three key European indices were in the green and the US stock futures were mixed with a negative bias.


Back home, foreign institutional investors were net buyers of shares totalling Rs1,244.96 crore on Wednesday while domestic institutional investors were net sellers of equities amounting Rs369.06 crore.


Turnkey constructions major Punj Lloyd today said its arm, Sembawang, has won a Rs1,168-crore construction project in Hong Kong to build MTR Corporation's Shatin to Central Link Diamond Hill Station in Hong Kong. The project would be executed by Sembawang along with consortium partner Leader Civil Engineering Corporation. The stock gained 1.18% to settle at Rs59.85 on the NSE.


GMR Infrastructure today said commercial operations of two its road projects Hyderabad- Vijayawada section of NH9 (National Highway 9) and Hungund Hospet section of NH13, are expected to generate a total revenue of at least Rs1 crore on a daily basis. While the Hyderabad-Vijayawada road is expected to generate revenue in the range of Rs75-Rs80 lakh per day, Rs18-Rs20 lakh would be collected through toll from the second road project. GMR Infra surged 2.69% to settle at Rs19.10 on the NSE.


BGR Energy is set to start work on the Rs1,548-crore contract to supply two 800-MW steam turbine generators for NTPC’s Lara Super Thermal Power Project in Chhattisgarh. The stock climbed 2.77% to settle at Rs271 on the NSE.


How drug companies use Rotavirus to frighten new moms and dads

Is the pharmaceutical industry trying to create an opportunity for making money by hard-selling new vaccines to parents by creating a false scare about the disease?

In July 2012, leading pharmaceutical major GlaxoSmithKline started issuing advertisements saying that nearly five lakh babies die in India due to Rotavirus. Hence, the aim was clearly to ensure that Rotavirus vaccines become a part of the mandatory vaccines that are given to new born babies and infants. What makes this advertisement interesting is that it did not promote a particular company but the need for the vaccine. In other words, here was a sly attempt by the pharmaceutical companies to unite and look forward to ‘creating’ a new market.

So, what is Rotavirus and its threat? Rotavirus is spread by ingestion of the virus through contaminated food, and effective hygiene helps in reducing the spread of infection. Former vice chancellor of Manipal University Prof Dr BM Hegde, a Padma Bhushan recipient has written a detailed and precise article shattering myths about Rotavirus. Dr Hegde debunks the process of vaccination by informing us that vaccination is now sold using statistical tricks of relative risk reduction while suppressing the most useful absolute risk reduction. The story also illustrates that medical companies have been using statistics as their weapon to sell ideas to gullible and doctors. The article also points to relevant studies quoted in the British Medical Journal.

What did the pharma companies aim to achieve by its so-called public service advertisement warning people about the Rotavirus vaccine? Once the alleged dangers of being affected by rotavirus are implanted in the minds of parents, pharmaceutical companies only need to push prescription by having armies of medical representatives to work on the doctors to promote it. Once a particular doctor also endorses the scare, then it is a win-win situation both for the pharmaceutical industry and the medical fraternity at the cost of ordinary people.

Thankfully, Dr Nalini Abraham, a Delhi-based medical practitioner, objected to the advertisements featuring the Rotavirus vaccination being broadcast freely on television channels and filed an official complaint with the Advertising Standards Council of India (ASCI). Her complaint dated 7 July 2012 alleges that the advertisement misrepresents facts as it demonstrates that vaccines are the only way to reduce incidents of infection. The advertisement further goes on to illustrate that simple methods such as hand washing do not help in prevention of infections. It is important to realize that the complaint was not about the expensive nature of the vaccine but the need for it.

Replying to the complaint lodged at the Advertising Standards Council of India in Mumbai, the advertisers maintained that the campaign did not refer to any brand name and did not mention the word ‘vaccine’. Thus, the advertisers maintained the campaign directed the audiences to consult his/her doctor for more information before making a direct-to-consumer sale pitch. They also claimed that their statements were substantiated by scientific studies conducted by global health authorities such as Centre for Disease Control and Prevention, PATH, Global Alliance for Vaccine and Immunization.


The Consumers Complaints Council (CCC) of the Advertising Standards Council of India reviewed the response provided by the advertiser and arrived at the conclusion that the claim of vaccination being the only way to reduce incidents of infection was inadequately substantiated. Keeping in mind the concerns lodged by the complainant, the claim that vaccination was the only way to treat rotavirus was also found to be misleading. The screening panel upheld the complaint filed by Dr Abraham under Chapters I.I. and I.4 and said that the issues raised by the vaccine were complex. The nature of the advertisement, therefore, could not be allowed to be broadcast in a direct advertisement to the public in such a misleading fashion.


NMDC suffers revenue loss during 2007-10: CAG

CAG said by extending unwarranted reduction in price, NMDC had passed Rs600.83 crore benefit to customers and not increasing prices in line with increase in export prices led to a loss of Rs227.40 crore for the state-run iron ore miner

New Delhi: Iron ore miner NMDC has suffered Rs745.94 crore revenue loss during 2007-10 for not revising the domestic prices of the steel-making raw material in line with prevailing market rates, the Comptroller and Auditor General (CAG) said, reports PTI.


"...due to non-revision of domestic prices by the company (NMDC) in line with movement of market price, the company has suffered a revenue loss of Rs754.94 crore during 2007-10," CAG said in a report, tabled in Rajya Sabha (Upper House of Indian Parliament), on Thursday.


The government auditor also said by extending unwarranted reduction in price, NMDC had passed Rs600.83 crore benefit to customers during 2010-11.


"Further, not increasing the prices by full percentage in line with increase in export prices led to a loss of Rs227.40 crore during the same period," CAG said.


The government miner exports iron ore by entering into long-term agreements (LTA) with Japanese Steel Mills (JSM) and the price it gets is at par with what Australian and Brazilian exporters get from JSM.


LTA prices of exports formed the basis for determining the domestic prices for LTA with domestic customers, CAG said, adding that 95% of NMDC's sales came from LTA and the rest were spot sales during 2005-12.


"Sales to domestic customers through LTA accounted for 84% of its sales," CAG said.


State-run Rashtriya Ispat Nigam and private sector firms like JSW Steel, JSW Ispat and Essar Steel are NMDC's major customers domestically.


During 2005-12, NMDC contributed 13% of India's iron ore production and met 26% of the domestic iron ore demand. Last fiscal, it had sold 27.3 million tonnes iron ore valued at Rs11,167.56 crore.


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