Volatility plagues Indian indices

Mon, 25 Feb Closing

   Previous Close   

   Pre-Open   

   09:30 am   

   11:30 am   

   01:30 pm   

Indian equity markets had a rather volatile trading session today. The indices began the day's proceedings on a cautious note and in the subsequent hours alternate bouts of buying and selling led the indices to alternate to either side of Friday's close. The scenario in the final trading hour was no different and the indices managed to close barely above the dotted line. While the BSE Sensex closed higher by 15 points, the NSE-Nifty closed higher by 4 points. The BSE Mid Cap and the BSE Small Cap were at the receiving end and both closed 1% lower. Losses were largely seen in metals and oil & gas stocks, while IT and auto stocks closed firm.

As regards global markets, most Asian indices closed firm today while European indices have also opened in the green. The rupee was trading at Rs 53.93 to the dollar at the time of writing.

As per a leading business daily, coal production in India in January 2013 stood at 55.5 m tonnes, an increase of 2.3%. Further, total coal output in India grew 5.2% from a year earlier to 435.5 m tonnes during April to January 2013. Of this, coking coal accounted for just under 10% at 41 m tonnes during the 10 month period. Coal India, which is the world's biggest coal miner, produced 355.3 m tonnes during the 10 month period and continued to account for about 80% of the country's total output. It must be noted that India is looking to produce 575 m tonnes of coal this fiscal year. The problem of coal shortage is only too well known in the country. Power companies in India have been unable to meet the domestic electricity demand on account of inadequate coal supplies from Coal India. Especially since the state-run mining giant has been unable to meet its production targets as a result of which the demand-supply gap has been widening. The stock of Coal India closed 2% lower.

MNC pharma companies closed mixed today. While GSK Pharma and Pfizer found favour, Sanofi India and Abbott India closed into the red. MNC pharma companies put up a mixed show for the quarter ended December 2012. While Pfizer reported a subdued growth in revenues but an increase in operating margins, for GSK Pharma it was the reverse as the company reported a double digit growth in revenues while margins witnessed a decline. The next few years will be important for MNC pharma players and those who step up pace of product launches in the domestic market will have the edge. This is because once the pricing policy comes into force, these companies will be impacted more than their domestic counterparts. This is because MNC pharma companies are entirely focused on the domestic market, while domestic pharma companies have exports to de-risk their overall revenue profile.