11:50 am Interview:
Iron ore prices have been falling for a while now and NMDC’s iron ore sales and production numbers too were disappointing for August. But Narendra Kothari, CMD of NMDC, believes prices have bottomed out and should increase a bit after this.
He believes that the 20 percent safeguard duty will benefit steel companies and hence indirectly iron ore companies as well.
The soft iron ore prices in part can be attributed to domestic demand, which has been rather low, and supplies have risen on the back of production from Odisha. Another reason can also be falling steel demand and prices.
The NMDC stock is down 28.13 percent year-to-date.
11:40 am Market outlook: Going by the volatility in the market, it appears as though the overall depth has reduced quite a bit, says Sachin Shah, fund manager, Emkay Investment Managers. In August alone, total FII outflow was to the tune of USD 2 billion and in September it already stands at USD 1 billion. This has definitely sobered the mood of the market, he told CNBC-TV18.
To cap it all, earnings downgrades are also playing spoilsport. However, on the brighter side, he says, the macro factors are favouring India and will keep the mood buoyant.
Going ahead, Shah believes Bihar elections in October will have only a sentimental impact on the markets, but the real focus will be on earnings. He feels that overall topline growth will be muted for consumer companies on the back of rural slowdown. He is bullish on private sector banks such as ICICI Bank and HDFC Bank.
11:30 am Big bull: Samir Arora of Helios Capital says investors should await for some clarity on the direction of the market before making any bets. The fund manager says he is 57 percent net long in the market currently, and has added exposure to stocks already invested in. “We have not added any new names in our portfolio. We have just increased our exposure in an NBFC and a crude related consumer company,” he says. On the Federal Reserve’s hanging sword, an unfazed Arora says a rate hike won’t impact India significantly.
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The market continues to slip further as the Sensex is down 302.72 points or 1.2 percent at 25416.86 and the Nifty is down 101.30 points or 1.3 percent at 7717.30. About 487 shares have advanced, 1508 shares declined, and 53 shares are unchanged.
TCS is up 1 percent while Hindalco, HUL, SBI, Vedanta and ONGC are major laggards in the Sensex.
The rupee trimmed its initial losses but was still down by 20 paise to 66.61 against the greenback on weak domestic equities and sustained dollar demand from importers amid higher dollar overseas. The domestic unit gave up its overnight gains and resumed sharply lower at 66.72 per dollar as against yesterday’s level of 66.41 at the Interbank Foreign Exchange (Forex) market
The dollar index is currently up 0.02 percent at 95.96 against a basket of six currencies. Crude oil prices fell in early Asian trade as weak Japanese and Chinese economic data fuelled concerns that low levels of investment could further erode already slow growth in Asia. In New York, the dollar trimmed early gains against the yen and the euro yesterday, but remained higher against both even as falling Treasury yields dulled the dollar’s luster.