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Indian markets open weak
Fri, 13 Nov 09:30 am

Major Asian stock markets have opened the day on a disappointing note. Stock markets in Hong Kong (down 2.1%) and China (down 1.2%) are the top losers in the pack. Major stock indices in Europe and US ended their previous session on a dismal note. The rupee opened trading at 66.34 per US$.

Meanwhile, Indian stock markets have opened the day on a negative note. The BSE-Sensex is trading lower by 266 points (down 1%) and NSE- Nifty is trading lower by 75 points (down 1%). Both, BSE Mid Cap and BSE Mid Cap stocks have opened in red. Both the indices are trading lower by 1.3% and 0.8% respectively. Majority of the sectoral indices have opened the day on a weak note too. Stocks from oil & gas and banking sector are leading losers in the pack.

According to a financial daily, the government data released recently showed weak growth in the Index of Industrial Production (IIP) data. Reportedly, IIP for the month of September rose by 3.6% in as compared to revised 6.2% in August. The growth was impacted due to poor performance in the manufacturing and consumer non-durable sectors.

Further, the Consumer Price Index (CPI) rose to 5% in October as compared to 4.4% in the previous month. The inflation grew mainly on account of rise in the prices of pulses due to domestic shortages. However, generation of electricity grew by 11.4% on a MoM basis. Further capital goods sector which indicates an investment demand in the economy grew by 10.5% on a MoM basis. Reportedly, sales of car too grew by 21.8% in the month of October.

The Nikkei Manufacturing Purchasing Managers Index (PMI) fell to 50.7 in October as compared to 51.2 in the month of September. A number below 50 indicates contraction in demand.

Among the various sectors, the regulatory issues in the Pharma sector have been quite recurrent these days. India's big pharma companies have been facing several challenges on this front. Dr Reddy's has been one of them. The company had recently received warning letter from the US regulator. And things seem to be just worsening further. As per an article in leading financial daily, Dr Reddy's Laboratories has been restrained from selling esomeprazole tablets in the US market. The order is issued by the district court of Delaware, USA.

Esomeprazole, also known as Nexium (brand name) has sales of around US$ 5.2 bn for the 12 months period ended July. The company had received approval couple of months back and was among the early entrants in US market for the drug.

Reportedly, the company stated that it is complying with the order of the Court and is simultaneously evaluating all possible options to resolve the matter at the earliest. Already, the company is facing regulatory issues and the recent order of restraining the sales of esomeprazole will further impact the company's business. It is imperative to note, this could had been quite a lucrative opportunity for the company.

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