Commodity stocks weigh on indices

Mon, 10 Jun Closing

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Indian equity markets had a rather volatile trading session today. The indices began the day's proceedings on a strong note but the weak rupee capped morning gains. The rupee today fell by a whopping 71 paise to hit a new life-time low of 57.99 in the late morning trade on persistent dollar demand from importers and banks amid the US currency gaining overseas. The afternoon session saw the indices trade range-bound and finally closed the day in the green. Buying interest was seen in IT, FMCG and Oil and Gas stocks. While the BSE Sensex closed higher by 11 points, the NSE-Nifty closed lower by 3 points. Both the BSE Mid Cap and the BSE Small Cap closed on a negative note.

As regards global markets, Asian indices closed in the green. European indices have opened mixed. The rupee was trading at Rs 57.99 to the dollar at the time of writing.

According to a leading financial daily, the Railways strategic business unit of L&T Construction's transport and infrastructure business has bagged an order of Rs 67 bn from the Dedicated Freight Corridor Corporation of India (DFCCIL), a special purpose vehicle of the Indian Railways. The order has been secured by a consortium of L&T Limited and Sojitz Corporation, Japan. The EPC order spanning three states involves construction of 626 km of a double track corridor between Rewari in Haryana to Iqbalgarh in Gujarat through Rajasthan. The scope of the project, to be completed in four years, includes construction of 1,400 track km of railway line, 50 major and 1,250 minor bridges and 20 stations along with supply of all associated equipment. This is the first of its kind project in India and the largest in the rail sector. L&T closed marginally lower today.

According to a leading financial daily, Oriental Bank of Commerce (OBC) has reduced the interest rates on certain domestic term deposits. Interest rates have been cut by 25 basis points on domestic term deposits (including NRO deposits) under various maturities for 270 days and above of term deposits of less than Rs 10 m. For deposits of less than Rs 10 m, the deposit rate on maturity period of 270 days to less than 1 year has been reduced from 8.5% to 8.25%. For deposits with maturity period of one year to less than two years, the deposit rate has been lowered to 8.75% from 9% earlier. There has been a 25 basis points cut in interest rates in other buckets - two years to less than three years, three years to less than five years, and five years to ten years as well. This move is being seen as a precursor to review the bank's base rate, which stood at 10.25%. The stock closed 2% lower today.