Global markets recover losses

Tue, 27 Sep 09:30 am

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After registering significant losses in the previous trading sessions, Asian stock markets have opened the day in the green. Stock markets in Hong Kong (up 2.5%), Indonesia (up 3.9%) and South Korea (up 4.2%) are leading the pack of gainers. The Indian stock markets have opened the day on a strong note as well. Metal, realty and consumer durable stocks are leading the gains.

The BSE-Sensex is trading higher by around 273 points (1.7%), the NSE-Nifty is up by around 82 points (1.7%). The midcap and smallcap stocks are in the positive as well with both the BSE Mid Cap and BSE Small Cap indices up by 1.5% and 1.4% respectively. The rupee is trading at 49.22 to the US dollar.

Aluminium stocks have opened the day on a firm note with National Aluminium Company (Nalco) and Hindalco trading in the green. On account of short supply of coal, state-owned aluminium producer Nalco has been facing a production loss of Rs 10 m per day. Against the normal output rate of 1,200 tonnes at the Angul smelter unit in Orissa, Nalco has reduced its daily production to 1,000 tonnes. The company's smelter produces about 37,000 tonnes of aluminium per month and runs on power supplied by its 1,200 MW captive power plant unit. The power plant requires about 12,000 tonnes of coal every day. Due to less availability of coal from Mahanadi Coalfields Ltd (MCL), the daily supply has reduced to 7,400-7,500 tonnes. As a consequence, the captive power generation has gone down to about 500-600 MW against the normal production rate of 850-860 MW. This is turn has affected aluminium production. To remedy the problem, the company has resorted to import of about 2 lakh tonnes of coal. Once the delivery happens, the company's aluminium production is expected to return to normal.

Pharma Stocks have opened the day in the green with Aurobindo Pharma, Lupin, Cadila Healthcare and Divi's Lab trading firm. Pharma major, Dr Reddy's Laboratories has scrapped its deal of Rs 1.4 bn with J B Chemicals. The deal was to acquire pharmaceutical prescription portfolio of J B Chemicals in Russia and other CIS countries. It is said that the deal has been mutually terminated by both the firms due to differences over valuations and operational issues. In a statement made by Dr Reddy's Laboratories, the company said that the deal is terminated considering the overall business interest of both parties. J B chemical has also come out with a circular stating the same. Both the companies have a very good existing portfolio of drugs in the Russia and CIS countries.