Indian share markets remain in red

Thu, 23 May 11:30 am

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Indian share markets have remained in red during the previous two hours of trade. Barring the IT sector, all other sectors are languishing in red.

The BSE-Sensex is down by 156 points and NSE-Nifty is down by 70 points. BSE Mid Cap index is trading down by 1.6% while BSE Small Cap index is trading down by 1.4%. The rupee is trading at 55.88 to the US dollar.

Indian Pharma shares are trading on a mixed note with Sun Pharma and Dr Reddy's leading the gains while Elder Pharma and Ranbaxy Labs are facing the maximum selling pressures. According to a leading financial daily, Daiichi Sankyo, the Japanese owner of Ranbaxy Laboratories, is contemplating towards taking legal action against Malvinder Singh and Shivinder Singh, the former promoters of the Indian drug maker. Daiichi Sankyo believes that certain former shareholders of Ranbaxy including the Singh brothers have concealed and misrepresented critical information concerning the US DoJ (Department of Justice) and FDA investigations. The Japanese company's statement comes nine days after Ranbaxy agreed to pay a fine of US$500 million for selling adulterated drugs in the US market and pleaded guilty to seven criminal counts, including intention to defraud and failing to report that its drugs did not meet specifications. These irregularities were committed when Ranbaxy was owned by the Singh brothers. Ranbaxy's share is trading down by 6.4%.

All but one mining share, Gujarat NRE Coke are trading in the red with Ashapura Minechem and Metals and Minerals Trading Corporation of India Ltd. (MMTC) facing the maximum selling pressures. According to a leading business news daily, State-owned, Coal India Ltd (CIL) will not allow the government to auction shale gas blocks in its command area and will explore and extract shale gas in their command area by themselves or in joint ventures with other companies. The decision by CIL management takes away substantial portion of shale gas reserves in Damodar basin, Bengal basin and in the Assam-Arakan basin that the petroleum ministry is planning to auction later this year. Besides this news, All India Coal Workers Federation and four other National Federations representing almost the entire 3.57 lakh employee force of CIL, in a letter to the Prime Minister have threatened to go on an indefinite strike if the government carries on with its plan of divesting an additional 10% in the company. The unions claim that the government had promised no further divestment. However, as the UPA - II have now decided on divesting an additional 10% in Coal India, workers' feel it is a breach of commitment and have resolved to go on an indefinite strike very soon. CIL's share is trading down by 0.4%.