Indian share markets open weak

Thu, 13 Jun 09:30 am

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All Asian stock markets have opened the day on a weak note with Japan (down 5.3%) and China (down 3.0%) leading the losses. The Indian share markets indices have also opened the day on a weak note. Barring consumer durables, all sectoral indices have opened in the red with stocks in the auto and healthcare space witnessing maximum losses.

The Sensex today is down by around 187 points (1.0%), while the NSE-Nifty is down by around 47 points (0.8%). Mid and small cap stocks have also opened in the red with the BSE Mid Cap and BSE Small Cap indices down by around 0.9% and 0.7% respectively. The rupee is trading at Rs 58.22 to the US dollar.

Barring Pfizer and Fulford India Ltd, MNC Pharma stocks have opened the day on a weak note with Abott India and Sanofi India Ltd leading the losses. As per a leading financial daily, Pfizer Inc has reached a US$2.15 bn settlement with Israel based Teva Pharmaceuticals Industries and Sun Pharmaceutical Industries related to patent infringement on its acid-reflux drug Protonix. As per the terms of settlement, Teva and Sun Pharma will compensate Pfizer's subsidiary Wyeth and Takeda for the losses incurred when two companies launched 'at-risk' generic versions of Protonix prior to the January 2011 expiration of the patent for pantoprazole (the drug's active ingredient). The drug acts to reduce the secretion of stomach acids and is used to treat the effects of gastroesophageal reflux disease. As per the settlement terms, Teva will pay US$ 800 m in 2013 and the remaining US$ 800 m by October 2014, while Sun Pharma will make a full payment of IS$ 550 m in 2013. Of the total, Pfizer will receive 64% of the settlement and its partner Japan's Takeda Pharmaceutical Co, will receive 36% or about US$774 m from the settlement.

Oil and gas stocks have opened the day on a mainly in the red with mixed note with Essar Oil and Castrol leading the losses. As per a leading financial daily, the Gujarat High Court (HC) has quashed a decision of GAIL (India) Ltd to terminate its contract to provide natural gas to Gujarat State Petroleum Corporation (GSPC). The court has further directed GAIL to fix the price for providing the gas from January 1, 2014. It is important to note here that GAIL and GSPC had signed a contract to provide natural gas for the period between 2004 and 2019. As per the contract, the prices for the gas to be provided from January 1, 2014, onwards were to be fixed by the two parties by December 31, 2011. However, the prices could not be fixed by December 31, 2011 because of the uncertainty shown by GAIL in fixing the price by the deadline. Post the deadline GAIL terminated the contract to supply the gas, a decision which was challenged by GSPC at the HC.