The News International Team
9:55 am DRug price control: The National Pharmaceutical Pricing Authority (NPPA) has withdrawn its disputed order for price control of 108 non-scheduled formulations. The order was to cap prices of a list of 108 cardiovascular and diabetes drugs, not part of NLEM (National List of Essential Medicines), and had created uproar from the industry leading to lawsuits contesting the order. Now with the withdrawal notification, the July 2014 order ceases to be valid. While it will be a disappointment for patients’ waiting to see their pharmacy bills benefit from lower prices in these two mass market drug categories, the order withdrawal will come as a relief for the domestic drug industry.
NPPA’s order had broadened the scope of price control even to drugs outside of NLEM, and the industry feared that the entire market was now susceptible to price control.
9:30 am Market outlook: Kunj Bansal of Centrum Wealth Management does not expect the market to correct sharply. He says a lot of negatives that could have had an impact on the market have cooled off – inflation is correcting, oil prices globally have fallen and the fear of less-than-needed monsoon has also abated. The three combine can result in WPI and CPI cooling. According to him, maximum there can be a 4-odd-percent correction in indices. Bansal feels cement continues to throw decent opportunities. He is bullish on Ramco Cement s on the belief that is will benefit from extra construction in Andhra Pradesh.
He also likes JK Lakshmi Cement within the space. He adds that despite the massive run up that pharma and auto ancillary stocks have seen, Torrent Pharma , Bharat Forge and Banco Products continue to offer good investment opportunities.
Don’t miss: Market correction over-due; buy midcaps but slowly, says Udayan
Equity benchmarks started off Tuesday’s trade on a flat note with the Sensex rising 32.39 points to 27239.13 and the Nifty advancing 9.10 points to 8155.40.
About 1005 shares have advanced, 357 shares declined, and 52 shares are unchanged.
TCS, Infosys, ICICI Bank, Wipro, NTPC, HCL Technologies and Tech Mahindra gained 0.7-1.7 percent while M&M, ITC, L&T, ONGC, HDFC Bank, DLF and Jindal Steel fell 0.4-1.4 percent.
Indian rupee has opened lower by 13 paise at 60.94 per dollar on Tuesday compared to previous day’s closing value of 60.81 a dollar.
Ashutosh Raina, HDFC Bank feels the focus now shifts to growth concerns in China. “Markets will be keenly awaiting the HSBC Manufacturing PMI today. The dollar strength has been the theme recently, with dollar index just shy of the psychological number of 85,” he adds.
According to him, locally, the story of FII flows and Central Bank intervention continues. He expects the USD/INR pair to trade in 60.50-61.50/USD range.
Asian markets were trading in the red in early trade after China released better-than-expected factory activity. Trade, however, is quiet with Japanese markets being shut for Autumnal Equinox Day.
Brent crude slipped to USD 96 dollars per barrel as demand and supply fears outweighed expectations of a cut in oil output from the OPEC. Precious metal gold struggled around USD 1215 an ounce, hurt by outflows from the top bullion backed exchange-traded fund (ETF) as investors adjusted positions in anticipation of higher interest rates in the US and further strength in the dollar.