Downward bias continues: Wednesday Closing Report

Market will bounce back but the direction is down

A weak set of second quarter results and global issues kept the Indian markets lower for a fifth day in a row. While the Nifty opened slightly above yesterday’s low, it could not sustain itself above those levels and closed lower. The National Stock Exchange (NSE) witnessed volume of 67.73 crore shares being traded today. The NSE Nifty closed the day 38 points or 0.75% down to 5,030 while the BSE Sensex ended 106 points below at 16,775 points, a decline of 0.63% over previous closing.

The Indian market continued to trade lower for the fifth day on poor showing by corporates in their second quarter earnings reports and a negative trend in the Asian markets this morning. The Nifty was down 10 points over its previous close at 5,059 and the Sensex opened trade at 16,872, down 11 points. Capital goods, oil and gas, banking, metal and auto sectors witnessed selling pressure in early trade.

The southward journey continued till the post-noon session after which a marginal bounce-back resulted in the market hitting the day’s high at around 2.30pm. At the high, the Nifty touched 5,059 and the Sensex went up to 16,878. However, institutional selling amid choppy trade in the late session resulted in the benchmarks coming off the highs. The market finally closed with a cut of over half a percentage point with the Nifty going down 38 points to 5,030 and the Sensex erasing 107 points to settle at 16,776.
 
The advance-decline ratio on the NSE was a dismal 466:1,218.

Among the broader indices, the BSE Mid-cap index settled 0.94% down and BSE Small-cap index declined 1.34%.

BSE Consumer Durables (up 0.56%); BSE Fast Moving Consumer Goods (up 0.51%); BSE Metal (up 0.15%) and BSE Realty (up 0.12%) were the sectoral gainers. The top laggards were BSE Capital Goods (down 3.88%); BSE Power (down 2.02%); BSE Oil & Gas (down 1.27%); BSE IT (down 0.92%) and BSE Healthcare (down 0.84%).

The top performing Sensex stocks today were Jindal Steel (up 3.03%); State Bank of India (up 2.02%); Mahindra & Mahindra (up 1.89%); ONGC (up 1.74%) and DLF (up 1.30%). The top losers were Jaiprakash Associates (down 4.49%); BHEL (down 4.15%); Larsen & Toubro (down 4.04%); Sun Pharma (down 3.03%) and Hero MotoCorp (down 2.73%).

The major gainers on the Nifty were Jindal Steel (up 2.92%); Tata Steel (up 2.75%); SBI (up 2.72%); DLF (up 2.63%) and M&M (up 2.11%). SAIL (down 5.40%); BPCL (down 4.42%); Siemens (down 4.27%); GAIL (down 3.62%) and HCL Technologies (down 3.35%) settled at the bottom of the index.

The Asian pack closed lower as a rise in Italian bonds raised concerns that the country’s new government would face challenges to prop up the debt-stricken economy. The developments pulled down export-oriented companies in Asia, which depend on Europe to sell their products. Meanwhile, the Hang Seng Index slid 2% after the International Monetary Fund said Hong Kong’s sudden credit growth increased the risk of bad loans.

The Shanghai Composite tumbled 2.48%; the Hang Seng tanked 2%; the KLSE Composite shed 0.03%; the Nikkei 225 declined 0.92%; the Straits Times fell 0.15%, the Seoul Composite skidded 1.59% and the Taiwan Weighted lost 1.38%. On the other hand, the Jakarta Composite added 0.01%.

Back home, foreign institutional investors were net sellers of equities totalling Rs 409.77 crore whereas domestic institutional investors were net buyers of shares aggregating Rs205.96 crore.

State-owned oil marketing companies (OMCs) last night slashed petrol price by Rs2.22 a litre, the first reduction in 33 months. The reduction comes days after state-owned oil companies raised petrol prices by a steep Rs1.80 per litre. Following the reduction, Indian Oil Corporation declined 2.38% to Rs269 on the NSE, Bharat Petroleum Corporation plunged 4.42% to settle at Rs514.65 and Hindustan Petroleum Corporation tumbled 5.27% to Rs285.80 today. Earlier in the day, they all touched their 52-week lows in trade.

Titan Industries today said it is set to acquire Swiss watch brand Favre Leuba for up to 2 million euro (over Rs13 crore) as a part of its strategic business plan to expand product portfolio. Titan has signed a binding offer with Valfamily SL Spain and Maison Favre Leuba of Switzerland for the acquisition, following which the Indian watch major will secure global rights of the brand. The stock jumped 3.88% to close at Rs214.85 on the NSE.

Glenmark Pharmaceuticals today said it is launching anti-ageing products from the stable of Canadian firm Immanence-IDC as it forays in to the cosmeceuticals segment in India. A new division ‘Glenmark CosmoCare’, has been formed to pursue opportunities in the cosmeceutical segment in the country, Glenmark said in a statement. The stock added 0.24% to close at Rs335 on the NSE.

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RBI monitoring rupee; will intervene when necessary: FM

A weaker rupee is a matter of concern for India as it depends on imports for over 70% of its oil and gas requirements and the depreciation in the local currency have made imports expensive

New Delhi: As the rupee depreciated to a new 32-month low against the US dollar, finance minister Pranab Mukherjee today said the Reserve Bank of India (RBI) is monitoring the situation and will intervene in the forex market “as and when necessary”, reports PTI.

“As RBI has already mentioned, it is watching the situation. As and when it is necessary, they will intervene” Mr Mukherjee told reporters on the sidelines of CAG event.

His comments came a day after the apex bank said that it will intervene in the foreign exchange market only to arrest volatility.

“We intervene when there is a very strong movement in a particular direction or extreme volatility and the objective is to smooth that volatility and not fix a rate,” RBI deputy governor Subir Gokarn had said yesterday.

The Indian rupee fell by 24 paise to a fresh 32-month low of Rs50.91 against the US dollar in early trade today amid depreciation of the euro due to the deepening debt crisis in the euro-zone nations.

The Indian rupee is the fourth most depreciated currency in the world and most depreciated in the Asian continent.

The RBI has attributed the movement to the demand-supply factor, and said it is happening globally.

Mr Gokarn had said that RBI would opt for open market operations to manage liquidity in the system only if there is a stress and not to influence government bond yields.

A weaker rupee is a matter of concern for India as it depends on imports for over 70% of its oil and gas requirements and the depreciation in the local currency have made imports expensive.

This has come at a time when headline inflation has remained above the 9% mark for 11 consecutive months.

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CIC says disclose inspection reports of apex cooperative banks as well

If there are certain irregularities in the working and functioning of such banks and institutions, the citizens certainly have a right to know about the same, Mr Gandhi said in his landmark judgement

In an unprecedented order, the Central Information Commissioner (CIC) Shailesh Gandhi has ruled that disclosure of inspection reports of apex co-operative banks of various states and Mumbai District Co-operative Bank must be shared with the public in a proactive manner. This kind of disclosure would certainly serve public interest, as mandated under Section 8(2) of the RTI Act, the CIC said.

Ruling out the public information officer's (PIO) contention that disclosing the inspection reports would prejudicially affect the economic interests of the Indian nation, the CIC said, "It is pertinent to mention that significant amounts of public funds are kept with institutions including co-operative banks which are regulated by the apex co-operative banks. Therefore, it is only logical that the public has a right to know about the functioning and working of such entities including any lapses in regulatory compliances."

"Merely because disclosure of such information may harm the economic interest of the state, this cannot be a reason for denial of information under the RTI Act. If there are certain irregularities in the working and functioning of such banks and institutions, the citizens certainly have a right to know about the same. The best check on arbitrariness, mistakes and corruption is transparency, which allows thousands of citizens to act as monitors of public interest. There must be transparency as regards such organisations so that citizens can make an informed choice about them," Mr Gandhi said in an order issued on 14 November 2011.

Mumbai-based Kishanlal Mittal has filed an application under the RTI Act asking for copies of inspection reports of apex cooperative banks of various states and Mumbai District Cooperative Bank from 2005. Mr Mittal also asked the National Bank for Agriculture and Rural Development (NABARD) to provide copies of all correspondences it had with Maharashtra state govt, the Reserve Bank of India (RBI) and any other agency of state or union government regarding Maharashtra State Cooperative bank from January 2010 onwards. He also sought confirmed and or draft minutes of meetings held by governing board and directors of NABARD from April 2007.

The PIO of NABARD, in his reply said that information about inspection reports and its directors' meeting sought by Mr Mittal, are exempted under Sec8(1)(a) of the RTI Act 2005. Unsatisfied with this answer, Mr Mittal then approached the first appellate authority, which did not pass any order within the stipulated time. Mr Mittal then filed second appeal with the CIC.

In its order the CIC said, “The Appellant (Mr Mittal) has sought copies of inspection reports of apex co-operative banks of various states/Mumbai District Co-operative Bank from 2005 till date. At the outset, this Bench is unable to agree with the PIO that disclosing the said inspection report(s) would prejudicially affect the economic interests of the Indian Nation. Moreover, even if the information sought was exempt under Section 8(1)(a) of the RTI Act, this Bench is of the considered view that disclosure of inspection reports of apex co-operative banks of various states/Mumbai District Co-operative Bank must be shared with the public in a proactive manner. This kind of disclosure would certainly serve public interest, as mandated under Section 8(2) of the RTI Act."

Section 8 (2) of the RTI Act states, “Notwithstanding anything in the Official Secrets Act, 1923 nor any of  the exemptions permissible in accordance with sub-section (1), a public authority may allow access to information, if public interests in disclosure outweighs the harm to the protected interests”.

The fundamental rights of citizens, enshrined in the Constitution of India cannot be curbed on a mere apprehension of a public authority. The Supreme Court of India has recognized that the Right to Information is part of the fundamental right of citizens under Article 19 of the Constitution of the India. Any constraint on the fundamental rights of citizens has to be done with great care even by Parliament. "The exemptions under Section 8 and 9 of the RTI Act are the constraints put by Parliament and adjudicating bodies have to carefully consider whether the exemptions apply before denying any information under the RTI framework," Mr Gandhi remarked in his landmark judgement.

You may also want to read:

Inspection reports of co-operative banks should be made public by RBI, rules CIC
 

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COMMENTS

MUNDLE UMESH

5 years ago

VERY GOOD DECISION TAKEN INTO THE PUBLIC INTREST.

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