A short-term pullback is possible depending on how the overseas markets move, but it will be met with renewed selling. Only a close above 6,240 can reverse the trend tomorrow
We had mentioned on Friday that a downtrend on the Sensex, Nifty may have started. On Monday, the indices opened much lower and stayed at that level until late selling pushed it down further.
The BSE Sensex opened at 20,899 and closed at 20,707 (down 426 points or 2.02%), while the NSE Nifty opened at 6,186 and closed at its lowest for the year 2014 at 6,136 (down 131 points or 2.09%). The fall on the Nifty was on a higher volume on the NSE at 62.89 crore shares. This is the highest daily loss since 3 September 2013 both on the Sensex and the Nifty.
All the indices on the NSE closed in the negative. The top five losers were Realty (7.44%); Nifty Midcap 50 (4.02%); Bank Nifty (4.02%); Metal (3.86%) and PSU Bank (3.83%).
Of the 50 stocks on the Nifty, five ended in the green. The top five gainers were Hindustan Unilever (2.54%); HCL Technologies (0.93%); Cipla (0.87%); ITC (0.14%) and UltraTech Cement (0.01%). The top five losers were Jaiprakash Associates (13.81%); DLF (8.66%); Ranbaxy (8.43%); Tata Motors (5.95%) and Tata Steel (5.93%).
Of the 1,480 companies on the NSE, 215 companies closed in the green, 1,226 companies closed in the red while 39 closed flat.
The weakness on the Indian bourses was on the back of a massive decline in the US on Friday, followed by a sharp fall in Asian markets on Monday. Concerns were over slower Chinese growth and reduced Federal Reserve stimulus. All the Asian indices closed in the negative. Jakarta Composite was the top loser which fell 2.58%.
The market now awaits the third quarter review of monetary policy for 2013-14 which is scheduled tomorrow, and the expiry of futures and options on Thursday. Market foresees that the RBI is unlikely to change key rates.
India may review gold import curbs by the end of March if the government is able to control the current-account deficit, said Finance Minister Palaniappan Chidambaram.
The Ministry of Consumer Affairs, Food & Public Distribution on Friday, 24 January 2014, said that as per data monitored by the Ministry of Consumer Affairs and Food, prices of rice, wheat and sugar during the week - 16 January 2014 to 23 January 2014 - remained steady in wholesale markets across the country.
Japan has reported a record annual trade deficit after the weak yen pushed up the cost of energy imports. Its deficit rose to 11.5 trillion yen in 2013 - a 65% jump from a year ago. This is the third year in a row that Japan - traditionally known for the strength of its exports - has reported an annual trade deficit. And, this time, despite a weak yen.
European indices were trading in the negative while the US Futures were trading marginally in the positive.
On behalf of its 28,000 members and bank customers, Moneylife Foundation has sent a letter to the RBI governor seeking more clarification for exchanging old or pre-2005 rupee notes
In order to get more clarity on the currency notes withdrawal and exchange process, Moneylife Foundation, on behalf of its over 28,000 members and lakhs of bank customers, has sent a letter to Reserve Bank of India (RBI) governor Dr Raghuram Rajan. This follows an advisory from the RBI to withdraw all currency notes issued prior to 2005, including Rs500 and Rs1,000 denominations from 31st March, which however, has resulted in hardships for several people.
Despite the advisory from the RBI, several banks are not accepting old currency notes and instead are found advising customers to wait till further clarification from the central bank. Banks are even found refusing to exchange old (pre-2005) currency notes withdrawn from their own ATMs. Bank employees too are clueless about the whole exercise.
Last week, the RBI in an advisory has said, "After 31 March 2014, it (RBI) will completely withdraw from circulation all bank notes issued prior to 2005. From 1 April 2014, the public will be required to approach banks for exchanging these notes".
This has prompted Moneylife Foundation to send a memorandum to the RBI. "We believe that RBI needs to issues appropriate instructions to banks on the exchange of notes without question. You may have noticed the Mumbai Mirror's front page article says that there is already a racket of charging 2% for exchanging these notes, caused by a lack of awareness and appropriate information to the public," the letter says.
Moneylife Foundation has urged the RBI governor, to initiate urgent corrective steps to stem this before it sets off panic and causes harassment. "Already, we have to examine each note that we get from ATMs while nobody is willing to accept currency that is pre-2005. In fact, the RBI circular has led to the belief that pre-2005 notes are as good as bad currency," the letter said.
Meanwhile, speaking with reporters, the RBI governor denied that the recall of the pre-2005 currency notes was an attempt at demonetisation and preventing black money or curbing tax evasion, and said it was aimed at reducing counterfeiting.
Here is the letter sent by Moneylife Foundation...
For weeks, Ferreira had avoided appearing before Mumbai police in the Rs425 crore QNet scam, until the Session Court asked him to present himself before the EOW. Ferreira is also booked by Mumbai police for allegedly forging documents to sell a plot of land at Gorai in Malad
Former world billiards champion Michael Ferreira on Monday appeared before the Economic Offences Wing (EOW) of Mumbai Police following directives from the Court in connection with the Rs425 crore QNet scam. Mumbai police had also issued a look notice against Ferreira after he failed to appear before the EOW.
For weeks, Ferreira had avoided appearing before the EOW until a Mumbai court hearing his anticipatory bail application asked him to present himself before the police by 27th January.
Earlier on 2nd January, Mumbai Police issued a lookout notice against Ferreira after he failed to appear before them despite summons in the second week of December asking him to turn up and explain his association with the company.
Last week, the Sessions Court while granting interim protection to Ferreira from arrest till 31st January asked him to appear in person before the EOW for probing his role in the multi-crore QNet scam.
Ferreira was summoned by the EOW in connection with the Rs425-crore scam allegedly committed by multi-level marketing (MLM) operator QNet. The former world champion is founder of Faith, which was started as a distributor network under the QI brand.
Last month, while speaking with news channels, Ferreira, who has gone abroad some time back, had said he would appear before the investigators as soon as he returns to India. He even defended the controversial company.
So far the EOW has arrested nine team leaders of QNet so far for allegedly duping investors by offering to sell products such as magnetic disks, herbal products and holiday schemes through fraudulent practices.
QNet has also been accused of using the banned binary pyramid business model for their multi-level marketing (MLM) schemes to lure investors. The accused have been charged with cheating and forgery under relevant sections of the Prize, Chits and Money Circulation Schemes (Banning) Act 1978.
Earlier this month, Gorai police booked Ferreira for allegedly forging documents for selling a plot belonging to 87-year old Cyril Edmond Henriques. According to a report from Mid-Day, in 1995, Cyril Henriques discovered that someone had started illegal construction on the land. He complained to Brihanmumbai Municipal Council (BMC), and the structures were demolished. Later, Henriques came to know that Ferreira had sold the land, pretending to be its owner. Following his complaint, police started an investigation and found that Ferreira had forged the documents.
"Even on 8 February 2000, during preparing the 'irrevocable power of attorney' Ferreira had shown that his brother Peter Dominic was present, and had signed on the paper. On that day, Peter was in Canada. On the basis of the alleged phony documents, Ferreira sold the plot to Manish Agrawal and Sanjay Agrawal for Rs11 lakh though the land’s market value then has been estimated to be Rs2.43 crore," the newspaper report said.