Market crashes: Sensex ends below 25000, Nifty dives 96 points

The bears tightened their grip on Dalal Street as the bulls continue to run for cover. Yet another late sell-off caught investors off guard as markets ended with losses for the 6th straight session.

The Sensex closed at 15-month low while Nifty was at 14-month low at closing. The 30-share index ended down 308.09 points or 1.2 percent at 24893.81, and the 50-share index slipped 96.25 points or 1.3 percent at 7558.80. The Nifty has lost 17 percent from its highest level in 2015 and the Bank Nifty lost nearly 25 percent.

The band-aids from the 2008 financial crisis are coming off and the wounds haven't really healed, says Shankar Sharma of First Global. However he does add that macro-economic fundamentals remain strong.

He expects 20 percent downside in emerging markets and 10 percent downside in India. ''I think emerging merkets have a 20 percent downside and India has probably a 10 percent downside because India will definitely be more resilient. I dont think you should bet on huge upside for any global market,'' he says in an interview to CNBC-TV18.

The rupee tumbled to fresh two-year lows as the dollar remains strong versus most Asian peers. The Indian currency hit 66.85 as demand for dollars remains robust from corporates and importers. 

ICICI Bank, Axis Bank, Vedanta, Dr Reddy's Labs and BHEL were major losers in the Sensex. Among the gainers were HDFC, ONGC, M&M and ONGC. Midcap Index was down 2.2 percent from previous close.

3:30 pm Market closes in deep red: The market closed in red for 6th consecutive day. The Sensex closed at 15-month low while Nifty was at 14-month low at closing. The 30-share index ended down 308.09 points or 1.2 percent at 24893.81, and the 50-share index slipped 96.25 points or 1.3 percent at 7558.80.

ICICI Bank, Axis Bank, Vedanta, Dr Reddy's Labs and BHEL were major losers in the Sensex. Among the gainers were HDFC, ONGC, M&M and ONGC. Midcap Index was down 2.2 percent from previous close.

3:20 pm China GDP revision: China's National Bureau of Statistics said it has revised down the 2014 GDP growth rate to 7.3 percent from the previously announced 7.4 percent. The downward revision mainly came from the service industry, whose growth was lowered to 7.8 percent growth from the previously announced 8.1 percent. Beijing is counting on service industry development to compensate for the slowdown in secondary industry.

This is the first revision of the GDP number and there will be another final revision, which normally only changes the value of GDP but the growth rate remains unchanged.

3:10 pm Market check: The Sensex is down 324.13 points or 1.3 percent at 24877.77, and the Nifty down 95.20 points or 1.2 percent at 7559.85. About 654 shares have advanced, 1938 shares declined, and 96 shares are unchanged.

Midcaps are underperformers while Bankex, Capital Goods, Metals, Healthcare and FMCG slip 1-2 percent from previous close.

3:00 Pharma drug patent rejection: India has again denied Pfizer a patent on its rheumatoid arthritis drug tofacitinib, the latest setback for a multinational drugmaker seeking to enforce its intellectual property rights in the country.

Pfizer sought a patent that covers an important chemical formulation of the active compound in the medicine, but the Indian Patent Office said the company would have to establish that the compound for which it is seeking a patent is therapeutically more effective than the active compound.

"The invention disclosed and claimed in the instant application ... is not considered as an invention under the provisions of the Act," Bharat N S, an assistant controller at the patent office, wrote in an order dated September 3.

2:50 pm OROP impact: The government has implemented the One Rank One Pension scheme which will be effective July 1, 2014. The pension will be revised every five years and all war widows will be paid arrears annually. But there are discussions on whether implementing the scheme can cause the government's fiscal target to go haywire.

However, there are indications that there is already a cushion of around Rs 20,000 crore in FY16 Budget, which is expected to help the government tide over the additional expense on account of the Rs 12,000 recapitalisation package announced for public sector banks as well as the additional expense that will come in now for One Rank One Pension (OROP). So, both these items will be taken care of by this Rs 20,000 crore cushion. Hence, it is not necessary that OROP is going to have a sizeable fiscal impact, at least not in the current financial year. In fact there may be no fiscal impact because of OROP if you look at the current numbers.

2:40 am Rupee: Rupee slips to a fresh 2-year low. The Indian currency is valued at 66.82 per dollar. Agam Gupta of StanChart Bank thinks the USD-INR currency pair will continue to get influenced by global forex and equity moves. He  expects to see exporters hedging their USD receivables on upticks towards 66.80/dollar.

2:30 pm Market slips: The market is under severe pressure. The Sensex is down 228.08 points or 0.9 percent at 24973.82 and the Nifty is down 76.80 points or 1 percent at 7578.25. About 696 shares have advanced, 1850 shares declined, and 92 shares are unchanged.

Vedanta, Axis Bank, coal India, Lupin and Dr Reddy's Labs are majorr laggards in the Sensex.

2:15 pm Global market outlook: The US Federal Reserve has an interesting problem ahead - on the one hand the second quarter GDP number and the unemployment number gives it the ammunition to hike rates in September, on the other hand the inflation expectation recently turned down, says Robert Parker of Credit Suisse. So much so that the headline inflation is close to zero.

However, he expects the Fed to raise rates as it tends to look at domestic inflation cues rate than external factors such as oil. Parker expects to see Fed funds rate of 50 basis points by the end of the year.

On the topic of recent global market volatility, he says up until July, volatility was at a historic low and stayed there. The jump now is because of the significant fall in commodity prices and the state of the Chinese economy, he says.

The market has extended losses as metals, phrama and FMCG continued to drag. The Sensex is down 90.48 points or 0.4 percent at 25111.42 and the Nifty slips 35.45 points or 0.5 percent at 7619.60. About 793 shares have advanced, 1696 shares declined, and 98 shares are unchanged.

HDFC, Tata Motors, Maruti, SBI and Cipla are top gainers while Lupin, Coal India, Dr Reddy's Labs, GAIL and BHEL are losers.

European equities traded higher, bucking the trend set in Asia where shares were trading mixed on the back of a revision in Chinese economic growth figures, with commodities trader Glencore soaring by 12 percent after it unveiled a debt revamp plan.

1:00 pm Market outlook: Ahead of Motilal Oswal Financial Services' 11th Global Investor Conference, joint managing director Raamdeo Agrawal says though this is a corporate conference, the focus is more towards government policy initiatives. Everyone wants to gauge how far is the so-called acchhe din, he told CNBC-TV18. He believes an important catalyst in the near term will be this government's performance.

However, an upbeat Agrawal says the market is full of surprises. "Nobody would have thought that despite the Narendra Modi government being in power and with commodity prices falling, foreign institutional investors (FIIs) would flee the market and domestic institutional investors (DIIs) would buy," he says.

1:30 pm Buzzing: Shares of telecom companies are in focus Telecom Regulatory Authority of India (TRAI) has proposed that service providers should compensate mobile subscribers for call drops and poor quality of services. Shares of Bharti Airtel, Idea Cellular and Tata Communication are under pressure intraday on Monday.

The  telecom regulator has floated a consultation paper seeking public view on the proposal. "It appears that a consumer relief measure against call drops would be effective only if it reaches the affected consumers. These measures could extend from not charging the consumers for dropped calls to compensating them by crediting talk-time or amounts in their accounts," the TRAI paper said.

Meanwhile, CLSA has slashed revenue and EDITDA estimates of telecom companies by 1-2 percent factoring in risks of delayed recovery and rupee depreciation.

The market continues to be rangebound with no major triggers expected today.  The Sensex is down 58.97 points or 0.2 percent at 25142.93 and the Nifty slips 25.50 points or 0.3 percent at 7629.55.About 796 shares have advanced, 1607 shares declined, and 95 shares are unchanged.

HDFC, Tata Motors, Maruti Suzuki, Cipla and SBI are top gainers while Coal India, GAIL, Lupin, Dr Reddy's Labs and Hindalco are among losers.

Meanwhile, Siddharth Teli, Banking Analyst at CIMB  says valuations of key private sector banks have become attractive after the recent correction, says.

While the firm is reviewing its earnings estimates for these stocks, his picks are Axis Bank, Yes Bank (at target price of Rs 1,000), HDFC Bank, (due to rate cut), ICICI Bank and HDFC, in that order.

Meanwhile, credit cost would rise more for public sector unit (PSU) banks than for private ones, due to higher exposure to the struggling iron and steel sector, Teli says.

12:59 pm Market Update: The Sensex declined 25.10 points to 25176.80 and the Nifty fell 12.65 points to 7642.40.

About 823 shares have advanced, 1567 shares declined, and 97 shares are unchanged on the BSE.

12:50 pm Buzzing: Nomura has upgraded Kotak Mahindra Bank to buy from neutral earlier, with a target price of Rs 750 (implied upside of 24 percent). It believes the recent 20 percent correction provides investors with a good entry into a high-quality bank and Kotak's earnings quality remains one of the best in the sector. The stock gained more than 1 percent.

After the ING Vysya acquisition, investors' expectations seemed high. However, Nomura feels Q1FY16 integration charges partially explain the lower acquisition cost and also set investors' expectations on growth and asset quality lower.

12:45 pm Shanghai Update: China's Shanghai Composite index closed down 2.55 percent at 3,079.7, after flip-flopping all day long between gains and losses on Monday.

The wild swings in China's equity markets led other regional bourses lower, while last Friday's sell-off on Wall Street further sapped risk appetite.

Major US indexes finished more than 1 percent lower last Friday, after the nonfarm payrolls report showed that 173,000 jobs were created in August, missing expectations of 220,000 and heightening uncertainty over the timing of a Federal Reserve rate rise.

The number had some analysts suggesting that the US central bank might wait until later in the year to raise interest rates, but traders appear to be betting on a rate-rise at next week's Federal Open Market Committee (FOMC) meeting.

12:40 pm Europe opens higher: European equities opened higher, bucking the trend set in Asia where shares were trading mixed on the back of a revision in Chinese economic growth figures.

London's FTSE index was up over 0.8 percent, the German DAX was over 1.1 percent higher and the French CAC saw a 1.1 percent pop.

12:30 pm Will Diageo recover loan?: Global spirits giant Diageo has said it may not be able to fully recover a loan of USD 135 million given to Vijay Mallya-affiliated Watson by Standard Chartered Bank where it had acted as a guarantor in case it is asked to pay up.

The world's largest spirits maker, Diageo, which acquired control of  United Spirits (USL) in 2012, had issued a guarantee to Standard Chartered Bank for a USD 135 million (around Rs 900 crore) loan to Watson to release certain USL shares that were to be acquired as part of the deal.

The company said the risk had arisen due to default by Watson in May and Debt Recovery Tribunal (DRT) in Bengaluru preventing sale or any other transfer of such UBL shares in June as part of the enforcement process pending further orders following petition by a consortium of banks led by State Bank of India .

''Standard Chartered is required to take certain pre-agreed steps to recover from Watson prior to calling on the Diageo Holdings Netherlands BV (DHN) guarantee... In the event that DHN makes any payment under the guarantee, DHN would intend to pursue claims under these indemnities to seek to recover any outstanding amount,'' Diageo said in its annual report of 2015.

12:20 pm Buzzing: Shares of IndusInd Bank surged over 2 percent intraday after the Reserve Bank on Friday removed the lender from its caution list. RBI in a release on September 4 said it has removed IndusInd Bank from its caution list, allowing foreign investors to buy further shares in the lender.

"The restrictions placed on the purchase of shares of the above bank are withdrawn with immediate effect," RBI said adding that the shares of IndusInd Bank can now be purchased through the primary market and stock exchanges.

Following which, shares of the company opened on a bullish note, in an otherwise volatile market, and surged 2.37 percent to an early high of Rs 860.

Under the Portfolio Investment Scheme (PIS), RBI keeps a tab on foreign shareholding of Indian firms in accordance with the stipulated cap.

12:05 pm Gainers & losers: Lupin, Axis Bank, Dr Reddy's Labs, HUL, Bharti Airtel, Coal India, NTPC, GAIL and BHEL declined 12.5 perent.

However, HDFC topped the buying list on Sensex, up 2.5 percent. Tata Motors, Maruti Suzuki and Cipla gained over 1 percent.

12:00 pm Market Check
The market continued to be volatile in noon trade with the Nifty hovering around 7650 level. Asian markets, too, were choppy in trade today with Shanghai down 1.7 percent.

The Sensex declined 11.57 points to 25190.33 and the Nifty fell 10.75 points to 7644.30. The broader markets underperformed benchmarks with the BSE Midcap down over 1 percent and Smallcap falling 0.8 percent.

About 752 shares have advanced against 1534 shares declined on the Bombay Stock Exchange.

Emerging market theme has run out of steam, says Shankar Sharma of First Global. He feels correction in emerging markets will continue in near-term. However, he says India is relatively well placed.

Capital goods, healthcare, telecom and select banks stocks saw selling pressure while HDFC group and select auto stocks supported.

Midcap stocks like Bharat Forge, Motheron Sumi, Crompton Greaves and Wockhardt fell 3-4 percent.

The rupee weakened to trade at fresh 2-year low after the dollar gained against most asian currencies and following dollar demand from traders and corporates. The currency declined 30 paise to 66.76 a dollar.

11:50 am Udayan's call: It is true that valuations of Indian equities have cooled down 10-15 percent, but the global picture remain foggy and expectation of a good return is therefore not a given, says Udayan Mukherjee of CNBC-TV18.

He does not mince words while conveying that India is not insulated from global problems and fears that retail investor patience may run thin in the days to come. He does not see Fed policy announcement changing the situation in a big way. This market will need 4-6 weeks more to understand if the downtrend is firmly established, Mukherjee said. The long term investors then can act and use the time to accumulate good quality stocks.

11:30 am Buzzing: CLSA is bullish on HDFC Bank and recommends buying it for a 31 percent return in a year's time. The brokerage has set a target price of Rs 1300 per share and expects HDFC Bank to deliver a 25 percent profit CAGR, much higher than the 20 percent growth in FY15.

It feels that HDFC Bank's widening growth gap versus corporate banks could expand its valuation premium as its focus is on a digital ecosystem, targeting revenue potential and operating efficiencies. According to CLSA, its credit card business is also at an inflection point and will not only drive fee growth, but will facilitate loan and deposit relationships.

The market is still volatile as the Sensex is down 24.39 points or 0.10 percent at 25177.51. The Nifty is down 14.95 points or 0.2 percent at 7640.10. About 743 shares have advanced, 1313 shares declined, and 69 shares are unchanged.

HDFC, Tata Motors, Cipla, Maruti and ITC are top gainers in the Sensex. Among the losers are GAIL, Coal India, Lupin, Dr Reddy's Labs and Bharti Airtel.

Gold extended losses into a fourth straight session on Monday, struggling near a 2.5-week low after US payrolls data failed to provide clarity on the timing of a Federal Reserve rate hike. Bullion had come under pressure on Friday after data showed nonfarm payrolls increased 173,000 last month after an upwardly revised gain of 245,000 in July, and the jobless rate dropped to a 7-1/2-year low.

The jobs count, however, may have been tarnished by a statistical fluke that has often led to sharp upward revisions to payroll figures for August after initial weak readings.

10:55 am Market update: The Sensex declined 51.19 points to 25150.71, and the Nifty fell 17.50 points to 7637.55 amid volatility.

About 721 shares have advanced, 1314 shares declined, and 67 shares are unchanged on the BSE.

10:45 am Oil under pressure: Oil prices fell as concerns of global oversupply, a firmer dollar and lacklustre US nonfarm payroll data on Friday weighed on oil markets.

The long Labor Day holiday in the United States may also lead to thin trading later in the session.

"US nonfarm payrolls turned out weaker than expected causing oil prices to fall on anticipations of a weaker economy," Singapore's Phillip Futures said in a Monday note.

Brent crude for October delivery fell 25 cents to $49.36 a barrel, after ending the previous session down USD 1.07, or 2.1 percent. The European benchmark fell almost 1 percent last week.

US crude for October delivery, also known as West Texas Intermediate, was down 22 cents at USD 45.83, after settling 70 cents down, or 1.5 percent, in the previous session.

10:30 am Chinese economy improving?: China's power usage, rail freight and property market have all shown improvement since August, indicating that the economy is stabilising, the country's top economic planning agency said today.

The effects of supportive policies, including interest rate cuts, property market stimulus and local government debt swaps, will feed into the economy over the next few months and help underpin growth, the National Development and Reform Commission (NDRC) said on its website.

"The power usage, rail freight, as well as real estate prices and turnover have all improved into August, indicating the economy is stabilising amid fluctuations," the NDRC said.

"The economy is expected to maintain steady growth and we are able to achieve annual economic growth target," it added.

A flurry of recent soft indicators - and a collapse in China's stock markets - had heightened fears of a hard landing for the world's second-biggest economy and sent global financial markets into a tailspin.

China's economy, which grew 7 percent in the first half from a year earlier and in line with the government's target for the year, is headed for its slowest economic expansion in 25 years in 2015.

10:15 am Market Expert: It is true that valuations of Indian equities have cooled down 10-15 percent, but the global picture remain foggy and expectation of a good return is therefore not a given, says Udayan Mukherjee of CNBC-TV18.

He does not mince words while conveying that India is not insulated from global problems and fears that retail investor patience may run thin in the days to come. He does not see Fed policy announcement changing the situation in a big way. This market will need 4-6 weeks more to understand if the downtrend is firmly established, Mukherjee said. The long term investors then can act and use the time to accumulate good quality stocks.

Mukherjee says equity markets have lagged in comparison to fixed income returns in the last few month, but it is difficult to say that the latter is a better investment proposition for the long-term. The asset allocation thus plays a very important role.

10:00 am Market Check: Equity benchmarks erased early gains following further correction in rupee. The currency hit fresh two-year low, trading at 66.76 a dollar, down 30 paise today. Banks, technology, pharma and capital goods stocks saw selling pressure.

The Sensex declined 83.28 points to 25118.62 and the Nifty fell 31.05 points to 7624 amid volatility. The broader markets underperformed benchmarks, falling 1 percent.

The market breadth remained weak as about 1138 shares have declined against 585 shares advanced on the Bombay Stock Exchange.

GAIL topped the selling list on Sensex, down 2.5 percent followed by ICICI Bank, Lupin, Axis Bank, Sun Pharma, Wipro, Dr Reddy's Labs and Bajaj Auto with 1-1.5 percent loss. Infosys and L&T declined 0.8 percent while HDFC, ITC, Tata Motors and Cipla bucked the trend, up 0.5-1 percent.

On the global front, major Asian markets recovered with the Shanghai rising 0.9 percent. Hang Seng gained 0.2 percent and Nikkei rose 0.5 percent.

9:55 am Market slips again: The Sensex is down 135.98 points or 0.5 percent at 25065.92 and the Nifty slips 37.10 points or 0.5 percent at 7617.95. About 596 shares have advanced, 1090 shares declined, and 72 shares are unchanged.

HDFC, ITC, Tata Motors, Cipla and Vedanta are top gainers.

9:48 am Market volatile: The Sensex is down 27.17 points at 25174.73, and the Nifty is down 10.30 points at 7644.75. About 692 shares have advanced, 890 shares declined, and 80 shares are unchanged. HDFC twins, Tata Motors, Cipla and ITC are top gainers while GAIL, NTPC, BHEL, Bharti Airtel and Wipro are losers.

9:30 am Outlook: Chinese authorities over the weekend tried to assuage global markets by saying that the stock market correction in China is almost over. But will this act as a balm to the jittery markets is the big question here. Peter Hooper of Deutsche Bank Securities says it will be taken positively.

An optimistic Hooper says the global growth picture has not deteriorated significantly and a September interest rate hike by the US Federal Reserve is still very much on the cards. Though, he adds that a lot now depends on inflation and the volatility in the market.

According to him, the Fed hiking rates will be taken as recognition that the US market is doing well. But the Fed, he adds, will make it very clear that it is not the beginning of an aggressive rate hike cycle and that it will be a slow and gradual process.

9:24 am Market gains: The Sensex is up 106.48 points or 0.4 percent at 25308.38 and the Nifty gains 42.15 points or 0.5 percent at 7697.20. About 717 shares have advanced, 420 shares declined, and 48 shares are unchanged.

Tata Motors, HDFC, Cipla, Vedanta and Tata Steel are top gainers while Bharti, GAIL, M&M, Wipro and ICICI Bank are laggards in the Sensex.

After initial gains, the market has slipped into red quickly. The Sensex is down 6.57 points  at 25195.33 and the Nifty is down 7.50 points at 7647.55. About 398 shares have advanced, 256 shares declined, and 46 shares are unchanged.

GAIL,  Bharti, NTPC, BHEL and Sun Pharma are top losers while Tata Motors, Vedanta, Cipla, Tata Steel and ITC are top gainers in the Sensex.

The Indian rupee slipped by 14 paise in early trade. It has opened at 66.60 per dollar against Friday's closing value of 66.46 a dollar.

Agam Gupta of StanChart Bank feels the USD-INR should open slightly higher near 66.60-66.65/dollar due to the negative sentiment in European and US
stock markets.

According to him, it should trade in a range of 66.35-66.85/dollar for the day.

Globally, US stocks closed more than 1 percent lower ahead of a long weekend on Friday as uncertainty about the timing of a rate hike and Chinese economic growth continued to weigh.

The country's unemployment stood at a 7-year low, despite the August non-farm payrolls coming in way below estimates.

Asian shares saw recovering in early trade. China's Shanghai Composite reversed a brief negative open to surge 1.7 percent within 15 minutes of opening.

Crude prices declined as traders shrugged off a drop in the number of US rigs drilling for oil and focused instead on a supply glut and declining stock prices on Wall Street.

Precious metal gold's prices continued to fall, trading at around USD 1120 an ounce.