Mid & smallcaps buck the trend

Wed, 25 Jun Closing

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   09:30 am   

   11:30 am   

   01:30 pm   

The Indian equity markets opened the day on flat note, and soon drifted into the red, trading in a range bound manner till the end. The BSE-Sensex closed lower by 55 points while the NSE-Nifty closed down by 11 points. However the small cap and mid cap indices were in favour today. The BSE Mid Cap and BSE Small Cap both closed up by 0.52% and 0.35 % respectively. Stocks from capital goods and oil & gas sectors were the biggest losers today, while gains were seen in stocks from realty, healthcare and consumer durables sectors.

As regards global markets, Asian indices closed on a weak note, while European indices opened weak. The rupee was trading at Rs 60.18 to the dollar at the time of writing.

With rainfall in June being below average, monsoon deficit is likely to be a bigger headache for the Modi government as compared to managing the fiscal or current account deficits. While India gets maximum rainfall during July and August each year, the fact that 80% of India has received below average rainfall during the month of June indicates the kind of rainfall deficit the country could face. While rainfall has been good in southern parts of India, the central and western regions witnessed poor monsoons. If the situation does not improve over the next two months sowing will get impacted. This may stoke food inflation and test the administrative capabilities of the new government. Though steps like delisting fruits and veggies from agricultural produce market committee (APMC) act has helped curb food inflation to an extent, if the monsoon itself is deficient and harvest suffers the government will be able to do very little about it.

Majority of the Indian pharma stocks ended the day on a firm note with Dishman pharma and Biocon being the leading gainers. As per an article in leading financial daily, Lupin Ltd is looking to expand its presence various markets. The company is scouting for various options in Japan, India and emerging markets like Russia, China, Brazil, Turkey and Korea. Lupin already has good presence in Japan and India. It also sees good opportunity in Latin American market. It is imperative to note that Lupin is among the few successful companies to have established good presence in the Japanese market. Lupin too has robust portfolio in the domestic market. It would be interesting to see which countries Lupin enters or is able to penetrate further. As competition in the pharma space intensifies, Lupin too is looking at various options to fuel its future growth.