If the Nifty breaks today’s low, it may slip 5,000 and then to 4,970
The market settled lower as high inflation numbers pulled down rate-sensitive sectors and weakened the likelihood of a rate cut by the RBI in its mid-quarter policy review, slated to be take place on Monday. Today’s loss on the Nifty almost wiped off the gains of past two trading days. If the index closes in the negative tomorrow, we may see the benchmark slipping to the level of 5,000 and then finding its next support at 4,970. The National Stock Exchange (NSE) saw a volume of 53.09 crore shares.
The market opened on a cautious note ahead of the release of the wholesale price index (WPI) inflation numbers for May. Unsupportive global cues also weighed on the market. The Asian pack was lower in morning trade tracking the weak US markets overnight and ratings agency Moody’s downgrade of Spain’s rating by three notches to ‘Baaa3’ from ‘A3’, the lowest level of “investment grade” or just above ‘speculative’ or ‘junk’ grade.
The Nifty opened 16 points lower at 5,105 and the Sensex resumed trade at 16,857, down 24 points from its previous close. Choppiness since the opening bell saw the indices fluctuating mostly in the negative terrain in morning trade.
Select buying in late morning trade enabled the benchmarks emerge into the green and hit their intraday highs. At this point, the Nifty rose to 5,130 and the Sensex climbed to 16,921.
The market saw a sharp fall after the announcement of the WPI inflation numbers, which came in higher at 7.55% in May. The decline continued as the key markets in Europe opened with minor losses following Moody’s downgrade of Spain by three notches. Capital goods, banking, realty and power stocks were on the sellers’ radar.
The indices continued to drift lower in the absence of any positive triggers on the domestic front and on global concerns. The market dropped to its intraday low in the last half hour with the Nifty falling to 5,048 and the Sensex going back to 16,659.
The market closed near the lows as higher inflation as the likelihood of a rate cut by the RBI, on the back of a steep rise in inflation, appeared slim. The Nifty declined 67 points (1.30%) to settle at 5,055 and the Sensex tanked 203 points (1.20%) to end the day at 16,678.
The advance-decline ratio on the NSE was tilted towards the losers at 501:1206.
Among the broader indices, the BSE Mid-cap index tanked 1.27% and the BSE Small-cap index dropped 0.67%.
BSE IT (up 0.33%) and BSE TECk (up 0.13%) were the only gainers in the Sensex list today. The losers were led by BSE Realty (down 2.91%); BSE Bankex (down 2.82%); BSE Capital Goods (down 2.79%); BSE Power (down 2.16%) and BSE Auto (down 1.99%).
Infosys (up 1.09%); Cipla (up 0.58%); ITC (up 0.29%) and Sterlite Industries (up 0.15%) settled higher on the Sensex. The key losers were Tata Motors (down 4.56%); Larsen & Toubro (down 3.92%); NTPC (down 3.76%); ICICI Bank (down 3.50%) and State Bank of India (down 3.06%).
The top performers on the Nifty were Infosys (up 1.15%); ACC (up 0.83%); Cipla (up 0.82%); Sesa Goa (up 0.77%) and Cairn India (up 0.75%). On the other hand, Punjab National Bank (down 5.71%); Tata Motors (down 4.47%); IDFC (down 4.29%); L&T (down 4.07%) and NTPC (down 3.89%) settled at the bottom of the index.
Markets across Asia closed mostly in the negative on reports of Moody’s downgrading Spain’s credit rating by three notches. Besides, signals from the US and Europe pointing towards slowing economic growth also weighed on investors.
The Shanghai Composite declined 0.99%; the Hang Seng dropped 1.15%; the Jakarta Composite tanked 1.78%; the KLSE Composite fell by 0.34%; the Nikkei 225 slipped 0.22%; the Straits Times declined 0.47% and the Taiwan Weighted settled 0.19% lower. On the other hand, the KOPSI Composite surged 0.65%.
At the time of writing, the key European indices were trading with cuts of 0.08% to 0.92% while the US stock futures were in the positive.
Back home, institutional investors, both foreign as well as domestic, were net buyers in the equities segment on Wednesday. While foreign institutional investors pumped in Rs217.68 crore, domestic institutional investors put in Rs76.87 crore.
Carborundum Universal, belonging to the Murugappa group, has inked a techno-commercial pact with Sheffield Refractories and with Anderman Ceramics, both based in the UK. The agreement is for manufacture, supply and installation of a range of high-end refractory solutions for the steel and glass industries and aerospace component manufacturing. Carborundum Universal settled at Rs148.10 on the NSE, up 0.07% over its previous close.
Oil India (OIL) is reported to have shelved its plans to acquire a 51% stake in Mukesh Ambani's Reliance Gas Transportation Infrastructure (RGTIL). OIL has decided to focus on its core business although it had submitted an expression of interest last month. The scrip gained 0.24% to close at Rs463 on the NSE.
Gujarat Minerals Development Corporation (GMDC), a Gujarat government undertaking, on Thursday said it has signed an agreement of sale for non-plant grade bauxite with a Hyderabad-based Anrak Aluminium which would help GMDC earn Rs20 crore. GMDC said it would provide bauxite from its Gadhsisa bauxite mines in Kutch district. The stock closed at Rs174.55 on the NSE, up 0.09%.
But will the government manage to curb gross wastage in weddings when its own ministers are seen flouting norms?
Since the last several years the “Big fat Indian wedding” may have attained a glamorous tone but the clamour to stop lavishness bordering on vulgarity of wealth display has been making the rounds. Surprise, surprise, steps are being taken by the government itself, whose members of Parliament are also responsible for hosting extravagant weddings.
Recently, Delhi-based RTI (Right to Information) activist Subhash Chandra Agarwal invoked the law to find out the status of the committee meetings and recommendations made to enact a law similar to the Guest Control Order Act which was implemented in the 1960s but was not adhered to. In fact, the central government authorities are unable to find the original document so Assam’s State Guest Control Order Act of 1967 is being used as reference.
What are the repercussions if such a law comes by? Well, you would not be allowed to serve tandoori kebabs, Chinese, Thai, Italian and South Indian—all in one breath—to impress your guests. The plans are to have a Pakistani type law which is being well implemented there since the last 15 years of “one dish, one rule” for everyone.
As per the RTI documents procured by Mr Agarwal, the committee to reduce wastage of foodgrain and ostentatious behaviour witnessed during marriages, parties and meetings was formed on 30 May 2011 for an initial period of two months and extended up to 31 March 2012. (There been no consensus as yet.)
The committee decided to recommend measures on:
• Launching an awareness campaign through “Jago grahak jago” scheme
• Explore options to introduce legislative and administrative measures in due course
• Examine how the government/public sector could set an example by practicing austerity.
Discussion in the first meeting on 30 June 2011 zeroed on:
• Awareness campaign through audio-visual publicity in schools and colleges
• Sensitise the student community about avoidable wastage
• Identify NGOs involved in collection of surplus food for distribution to the poor
• Ask an expert organisation to conduct a survey on food wastage to assess the magnitude of the problem.
Accordingly, the ministry of consumer affairs, food & public distribution sent a letter dated 25 August 2011 to all state governments and union territories. It has directed them to conduct awareness campaigns in schools and colleges against vulgar expenditure in weddings and other public functions.
On 4 April 2011, even before the central government sent a directive to the state governments, a document procured under RTI shows that Sudarshan Agarwal, former governor of Uttarakhand and Sikkim wrote to prime minister Manmohan Singh stating: “it is with deep anguish that I am writing this letter as a concerned citizen of this country about the colossal wastage of food at weddings and other social functions in the country. It is painful to see 100 dishes being served to 1,000 or more guests at several of these weddings… Last year, a minister in Karnataka had a wedding reception for 30,000 guests in a pandal where he had put 350 air-conditioners. I sincerely feel that we need to revive the Guest Control Order which limits the number of dishes that can be served at dinners/lunches and also limits the number of guests.”
He further wrote: “This will help to embellish the image of the government and show that it cares. Unfortunately, the ministers themselves have not set an example. A couple of years ago, a union minister had his daughter’s wedding at a heritage hotel in Jodhpur and it is reported that 60 private aircraft landed in Jodhpur carrying the invitees for the wedding. People are no fools; they understand everything.” Mr Agarwal has demanded the promulgation and implementation of the “Guest Control Order”.
Thereafter, on 5 August 2011, Prof KV Thomas, minister of state for consumer affairs, food and public distribution sent a letter to Kapil Sibal requesting him to include this subject in secondary schools. The letter states:”as you are aware, large quantities of food served at social gatherings like marriages, parties, etc are wasted while millions of people go hungry in the country. A number of dishes served in such lavish parties exhibit vulgar display of wealth and ostentation… I shall be grateful if you could kindly consider including this subject in the syllabi of the secondary and higher secondary schools through the medium of National Curriculum Framework (NCF) under the NCERT on the same lines as disaster management and environmental awareness.”
However, efforts towards curbing weddings have met with strong objections from various political parties. Several years back a prominent minister of Maharashtra had invited more than 30,000 people from several villages and towns of his constituency. Being summer time, hundreds of ice blocks were put in the wells for cold, drinking water. While the media carried negative stories on this extravagance, the minister argued that this was the only time he could give back to all the people in whose houses he has had a meal, some time or the other.
Dear readers, we invite you to give your opinion in 100 words about whether you think lavish weddings should be curtailed or not? Write to [email protected].
The picture in Pakistan
• In 1997, the then Prime Minister Nawaz Sharif came up with the slogan “One dish, one rule for everyone” for marriage ceremonies
• The marriage (prohibition of wasteful expenses) law which was implemented permits only one dish (one curry, with roti, rice and salad)
• The number of invitees not to exceed 300
• Rs5 lakh penalty for those violating the norms
• The law apparently is presently being well implemented and violators penalised
The two main facets of the law:
• No person celebrating his or the marriage of any other person, shall serve or allow anyone to serve more than one dish to persons participating in the marriage in a club, hotel, restaurant, wedding hall, community centre or any other place except hot and cold soft drinks
• No person running a hotel, restaurant, wedding hall, community centre or club being the site of marriage ceremony or any caterer shall serve or allow anyone to serve more than one dish to the participants of the marriage ceremony other than hot and cold soft drinks.”
(Vinita Deshmukh is the editor of Life 365 (www.life365.in). She is also the consulting editor of Moneylife, an RTI activist and convener of the Pune Metro Jagruti Abhiyaan. She is the recipient of prestigious awards like the Statesman Award for Rural Reporting which she won twice in 1998 and 2005 and the Chameli Devi Jain award for outstanding media person for her investigation series on Dow Chemicals. She co-authored the book “To The Last Bullet - The Inspiring Story of A Braveheart - Ashok Kamte” with Vinita Kamte. She can be reached at [email protected].)
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