Indian stock market edged lower on Thursday after opening marginally higher. Indian equities fail to get a boost from the Reserve Bank of India repo rate cut yesterday by 25 basis points to 6% and the Wall Street rally last night as Dow Jones hit the 22,000 mark for the first time in history. The domestic market also fell into negative territory as the Asian shares slid on Thursday, led by falls in South Korean tech shares. BSE Sensex opened 25 points higher and NSE Nifty 50 was almost flat in the opening trade at 10,081.85 points.
On Wednesday Wall Street’s Dow Jones Industrial Average broke the 22,000 barrier for the first time in its 121-year history buoyed by Apple’s healthy quarterly iPhone sales, while weakness in other tech stocks held back the Nasdaq and S&P 500.
After opening slightly higher Indian equities recoiled and slipped in red, following the Asian cues. The 30-share barometer fell over 100 points to the day’s low of 32,357.76 points while the wider Nifty 50 washed off 32 points and hit the day’s low of 10,049.05 points.
Pharma shares shine on Sensex including Lupin, Cipla, Sun Pharma, Dr Reddy’s with gain up to 1.65%. The stocks of HDFC, HDFC Bank, Kotak Mahindra, ICICI Bank, SBI, Axis Bank slumped and were the major contributors in dragging the benchmark indices down. Collectively all these banking and financial shares pushed the Sensex down by 88 points.
Shares of Indian Oil Company Ltd, Titan, Bajaj Electricals, BSE, CEAT, Colgate, Cummins, ICRA, PNB Housing, Ujjivan, Greaves Cotton, Gujarat Alkalies And Chemicals, HCC, Jindal Saw, Jk Lakshmi Cement, Jyothy Laboratories, Majesco, Ramco Systems, Sequent Scientific, Tejas Networks, Ramco Cements, VIP Industries, Welspun Corp will be in focus today ahead of the first quarter earnings.
The rupee strengthened by 5 paise to trade at a fresh two-year high of 63.65 against the dollar, buoyed by hopes of more capital inflows, coupled with more selling of the American currency by banks and exporters. The dollar’s muted show against other currencies overseas added to the rupee value, dealers said. Yesterday, the rupee had surged 37 paise in its best
single-day show this year to breach the psychological 64-level, ending at a fresh two-year high of 63.7. This followed the RBI lowering the repo rate by 0.25%.
The revised repo rate at 6% is the lowest in six-and-a-half years since November 2010. The central bank also kept the policy stance ‘neutral’ with an eye on inflation, which it said will be watched for a rise later this year. Accordingly, the revised reverse repo rate and the marginal standing facility rate will now stand at 5.75% and 6.25%, respectively, the RBI said in a statement. This is the first rate cut since October 2016 and the interest rate is now at a 6-year low. They added that no change in cash reserve ratio too had a bearing.
In New York overnight, the Dow Jones Industrial Average topped the 22,000 mark for the first time on the strength in Apple shares following its earnings. Apple jumped 4.73% to a record high after the world’s largest publicly listed company reported strong results. It is up 36 percent this year. The Dow Jones Industrial Average rose 0.24% to end at 22,016.24, a record high. The S&P 500 gained 0.05% to 2,477.57 and the Nasdaq Composite was flat at 6,362.65.