11:20 am Indian markets seem to have completely ignored the political stand-off between the Democrats and the Republicans that puts the US in danger of busting through its debt ceiling.
However, Indian markets are moving on and are trading at the high point of the day.
While BSE Sensex is up 86 points at 19467, the Nifty is up 24 points at 5759.
" US shutdown is a big yawn, just a political football in Washington. History shows that market actually went up rather than down," said Societe Generale in an interview with CNBC-TV18.
According to the investment bank, the US economy may be impacted by merely 0.2 percent due to the partial shutdown of the government.
Sensex recoups losses, 80% Federal workers will work despite US shutdown
10:43 am Indian markets recouped some of their losses supported largely by financials, auto, technology and capital goods stocks.
The Sensex rose 54.58 points to 19,434.35 and the Nifty gained 15.65 points to 5,750.95.
TVS Motor Company , country's third largest two-wheeler maker, gained nearly 7 percent after total sales in September increased 27 percent to 1.97 lakh units M-o-M.
Two-wheeler sales jumped 27.7 percent M-o-M to 1.89 lakh units in September while export sales rose marginally to 27,577 units from 27,425 units M-o-M.
Maruti Suzuki Sept domestic sales are up 1.8 percent, the stock is up 3 percent.
Despite partial shutdown of US government, about 80 percent of federal workers will continue working. According to reports, the 3.3 million employees who will have to work include those whose pay is not subject to annual appropriation such as the US postal service etc.
The shutdown will continue until Congress resolves its differences, which could be days or months. But the conflict could spill over into the more crucial dispute over raising the federal government's borrowing authority.
A failure to raise the $16.7 trillion debt ceiling would force the country to default on its obligations, dealing a potentially painful blow to the economy and sending shockwaves around global markets, Reuters reported.
Dollar stays steady even as US govt shutdown begins
10:14 am The dollar held steady on Tuesday even though much of the US.government was due to start shutting down after Congress failed to find a compromise on a bill to fund government operations.
Competing spending measures flew back and forth between Republican-controlled House of Representatives and Democratic-led Senate late into Monday night in Washington but Congress deadlocked over Republican efforts to use the temporary spending bill as a way to delay implementation of President Barack Obama's health care programme.
It comes a few weeks ahead of the next political battle to raise the federal government's debt ceiling. Failure to do the latter by mid-October could result in a historic US debt default that would threaten the U.S. economy and send ripples around the globe.
The dollar was down 0.1 percent against a basket of currencies. It was steady at 98.15 yen, having climbed off a one-month low of 97.50 on Monday as Japan's Prime Minister Shinzo Abe was expected to announce his economic growth and tax strategy later on Tuesday. ( Reuters)
10:am Furious Obama takes to Twitter, says Congress failure ob Budget forced govt shutdown
Congress has missed the deadline for averting the first partial government shutdown in 17 years. As the clock struck midnight Monday, House Republicans were demanding that the Senate negotiate their demand for a one-year delay in making millions of people buy health insurance under President Barack Obama's 2010 health care law. Minutes before midnight, the White House ordered a shutdown.
Critical functions like air traffic control and military operations will continue. Social Security benefits will be paid. National parks and most federal offices will close.
The shutdown is happening on the backdrop of a fragile economic recovery in the US. So people are likely to cut back on their spending and tourism will be affected as museums and parks will remain shut. According to President Barack Obama, the partial shutdown of the US government will definitely impact the economy and its citizens.
"Congress failure on Budget forces govt shutdown,, US troops will remain on normal duty status during the shutdown," tweeted US president Barack Obama.
"After more than a decade, the government is moving away from war footing.. we will continue to work with Congress to reopen the government," he added.
9:30 am Indian markets opened largely range bound this morning, tracking global cues.
The Indian markets today opened in the green but pared its gains after the US government officially shut down its services for the first time since 1996 after Congress failed to find a compromise on a government spending bill before a midnight (0400 GMT Tuesday) deadline.
"We urge Congress to act quickly to pass a continuing resolution to provide a short-term bridge that ensures sufficient time to pass a budget for the remainder of the fiscal year, and to restore the operation of critical public services and programs that will be impacted by a lapse in appropriations," said Sylvia Burwell, director of the White House Office of Management and Budget, in a statement.
While the BSE Sensex opened 0.37 percent higher at 19452, Nifty opened 0.20 percent higher at 5746. However, both the Sensex and Nifty gave up the early morning gains as White House has directed government offices to prepare for shutdown by midnight.
At 9:30 am, the Sensex was down 82 points at 19294.
Foreign institutional investors sold Indian shares worth Rs 519 crore on Monday on concerns over political dysfunction in US
The good news is that the India's external economy didn't do as badly as one would have expected in the June quarter.
India's current account deficit (CAD) in Q1 of 2013-14 was US$ 21.8 billion (4.9 per cent of GDP), compared with expectations of $22 billion.
Meanwhile, petrol price was reduced by Rs 3.05 per litre, the first reduction in rates in over five months, while diesel prices were raised by 50 paise a litre. The petrol price in Delhi will be cut by Rs 3.66 to Rs 72.40 per litre, while in Mumbai it will cost Rs 79.49 per litre as against Rs 83.63 currently.
Among the sectoral indices, the BSE Banking Index was up 0.3 percent, followed by the S&P BSE Auto Index which gained 0.08 per cent and the S&P BSE Healthcare Index rose 0.06 percent. The BSE FMCG index was trading BSE Metal index down 1.08 per cent, followed by the BSE FMCG index slipped 0.85 percent, the BSE oil & Gas index plunged 0.5 per cent and the BSE Power index was trading 0.4 per cent lower.
Rupee flat at 62.50, jittery investors await US govt shutdown
9:00 am 1 October, 2013 Indian rupee today opened flat at 62.50 against the US dollar on hopes that India's current account deficit will narrow in coming quarters. However, investors were jittery over imminent shutdown of partial US government services.
Sensex stock-index futures gained after the nation's current-account deficit widened less than forecast in the second quarter but gave up most of its gains on fears of a partial US government shutdown.
India's current-account deficit widened to $21.8 billion in the three months through June, compared with expectations of $22 billion.
The government has tightened curbs on gold imports to pare the deficit from a record $87.8 billion in the fiscal year ended March to support a battered rupee.
Tirthankar Patnaik, Religare said, "We expect overall CAD for the fiscal at a much lower USD 55 billion or 3.2 percent of GDP, thanks to a narrowing trade deficit. Concerns on the capital account have also faded after the RBI's recent steps. However, with lower growth and the Fed's 'taper' still remaining key risks for India, we maintain our 58-62/USD band for the rupee for now."
US Congress, still in partisan deadlock on Monday over Republican efforts to halt President Barack Obama's healthcare reforms, was on the verge of shutting down most of the US government starting on Tuesday morning.
The stock markets are already reacting negatively. US stocks closed lower on Monday ahead of a deadline to avert the shutdown.
A government shutdown would have wide-ranging implications for most assets. If a deal were reached quickly, markets might recover, but a prolonged shutdown could harm the economy and consumer confidence, said a Reuters report.
European markets closed lower with the Italian index leading the fall, after a series of Cabinet resignations that could trigger fresh elections. The Italian markets did recover from sessions lows on reports that Berlusconi's centre-right party could rebel if he continues to threaten to bring down the government. Stocks were also sent lower as a possible US Government shutdown becomes ever likely.
The benchmark BSE index slumped 1.76 percent, or 347.50 points, to end at 19,379.77. The broader NSE index fell 1.68 percent, or 97.90 points, to end at 5,735.30 on Monday.
Both indexes gained in September.Nifty rose 4.8 percent for the month, helped by foreign buying of more than $2 billion in Indian shares in September, the first net monthly inflows since May, regulatory data showed.
Sensex closes 400 points down on US, Italian political risks
3:30 pm Indian markets closed in the red today with the BSE Sensex down 400 points at 19326, while Nifty shut shop at 5721, down 111 points as political tension in Italy rattled investors already fearful of a looming US government shutdown.
Investors are concerned Italy will be forced into new elections just seven months after the last inconclusive vote, following Silvio Berlusconi's move to pull his ministers out of the ruling coalition on the weekend.
Aside from Italy, investor are focused on events in Washington where a deadline to avert a federal government shutdown is approaching, threatening to damage a fragile economic recovery.US law makers hardened their positions over the weekend making passage of a stop-gap spending bill for the new fiscal year by midnight on Monday, less likely.
Domestically, the RBI will release India's current account deficit today, which probably widened to as high as 5.4 percent in the June quarter, but a dramatic slowdown in gold imports and a rebound in merchandise exports are expected to narrow the gap in coming quarters
Biggest Sensex losers were ITC down 3 percent, ICICI Bank down 4.6 percent, HDFC down 3 percent.
BSE banking index closed down 3 percent, capital goods index too lost 3 percent while metals index was down 2.7 percent.
According to analysts, markets are likely to remain volatile and may trade with a negative bias in October, ahead of earnings for the quarter ending September 30, deadlock on US debt ceiling and two-day FOMC meet due on October 29-30, 2013.
Sensex going down but gold's on its way up on safe-haven buying
12:40 am Markets are trading lower but gold is edging higher as a possible US government shutdown prompted safe-haven buying, and the metal was on track to record its best quarter in a year despite a cloudy outlook for US stimulus.
Markets are feeling the heat as the three government crises (budget and debt ceiling in the US, governmental collapse in Italy) is hitting home and global stocks too. Over the weekend, the US Congress failed to agree on a budget, and the Italian government lurched towards collapse, as Berlusconi's party said it was withdrawing from the coalition.
Gold has gained nearly 9 percent in July-September, boosted by a big short-covering rally, geopolitical tensions in the Middle East and some weak US economic data.
"Gold has behaved like a safe-haven currency of late. The market is pricing in a possible government shutdown," Barnabas Gan, an analyst at OCBC Bank in Singapore, was quoted as saying by Reuters.
At 12:47 am. the BSE Sensex was down 285 points at 19747 while Nifty was down 87 points at 5750. Rupee was up 0.32 percent at Rs 30,824.
Fear of US shutdown spooks market, Sensex falls nearly 250 points
11:40 am Indian markets were deep in red today, with the Sensex down around 250 points on concerns of a possible shutdown of the US government at midnight if the Republicans and the Democrats fail to reach a common ground on debt ceiling issue.
In a government shutdown, spending for essential functions related to national security or public safety would continue along with benefit programs such as Medicare health insurance and Social Security retirement benefits for seniors.
But civilian federal employees – from people who process forms and handle regulatory matters to workers at national parks and museums – would be furloughed.
Apart from potential market swings, companies hoping to raise money in an initial public offering could face delays.
Businesses will still be able to file certain documents to the Securities and Exchange Commission, but the agency said on Friday that processing and approving applications will be discontinued during a shutdown.
"Capital-raising will have a huge hiccup if the SEC shuts down as it has said," said Eric Jensen, a partner with law firm Cooley LLP in Palo Alto, California.( Reuters)
In fact, the BSE Sensex extended intraday losses and was hovering below 19,500 ahead of the current account deficit (CAD) data to be releaseb by the RBI later today.
According to exports, the current account gap has widened in the June quarter due to a surge in gold imports and slowing exports.
At 11:50 am, the BSE Sensex was down 238 points at 19488, while Nifty was down 72 points at 5760.
Banking stocks fell on worries about higher non-performing loans and the possibility of RBI raising rates one more time with its new found focus on inflation.
Market analyst Sandeep J Shah sees no reason for the Nifty to head higher from the current level.
He is not totally bearish on market but cautions that the Nifty could re-visit the 5200-5400 depending on how soon repo rate hikes are announced and QE tapering, if it happens this year.
Speaking to CNBC-TV18, he said that there may not be an impact of the much-talked about US debt ceiling issue on Indian market.
10:am Volatility to rule: Sensex down 180 points; rupee nears 63
Indian stock market opened down today, in line with the global markets which declined due to concerns that the US may be heading for a shutdown of its services as impasse over raising the debt ceiling continued.
The dollar weakened as the deadline to increase the debt ceiling of the US approached, giving rise to risk aversion across the global markets.
The Sensex was down 0.95 percent at 19,539 and the Nifty 0.98 percent 5,775.80. The rupee also opened weaker at 62.91 against the dollar.
Dipen Sheth of HDFC Securities told CNBC TV18 the Indian markets will continue to be volatile and that there is no point in making any short term projections.
Reuters
"Nothing has changed as far as India structural weakness is concerned," he said. He said the cooling off in the West Asia is elusive as the region has always given negative surprises.
He expects more downgrades after this earnings season.
Interest rate sensitive shares like auto and banks were down, with BSE auto index declining 1.13 percent, Bankex 2.2 percent and the Realty 1 percent.
The interest sensitives are likely to continue their downward journey as hopes that the central bank will cut rates in the near future has receded.
Meanwhile, IT shares gained due to the fall in the rupee, which boots their export earnings.
Stocks in news
SpiceJet shares were down about 3.7 percent after its auditors raised doubts about the company's viability as its net worth has eroded completely.
ING Vysya shares were up about 4 percent after the Economic Times reported ING is looking exit the bank and that Kotak Mahindra Bank may be interested in buying the stake.
Financial Technologies was down about 6 percent as the NSEL crisis continued to be an overhang on the stock.
via Business - Google News http://news.google.com/news/url?sa=t&fd=R&usg=AFQjCNHvGzyoqmGX6ER2-EbDQwIGsS514w&url=http://www.firstpost.com/investing/live-us-shutdown-a-big-yawn-indian-markets-move-on-1141565.html
Put the internet to work for you.
No comments:
Post a Comment