Indian indices once again ended in the red extending its losing streak to fourth consecutive trading session. Equity market in India did start off on a promising note tracking overnight gains in the US markets, however it was short lived as indices lost ground gradually. Today’s decline was led by the health care, capital goods, realty and banking stocks. Even the mid cap and small cap stocks ended with marginal losses. On the other hand, FMCG, telecom, power and utilities ended with smart gains. Nifty closed with a loss of 19 points at 7,731 while Sensex ended with a loss of 72 points at 25,230.
Asian markets finished mixed as of the most recent closing prices with Japanese shares dropping amid renewed strength in yen as fresh data showed the country’s exports continued to fall. The Nikkei 225 & the Hang Seng fell 0.49% and 0.22% respectively while the Shanghai Composite gained 0.64%. European markets are lower today with shares in France off the most. The CAC 40 is down 0.29% while London’s FTSE 100 is off 0.10% and Germany’s DAX is lower by 0.09%.
Shares of Oil and Natural Gas Corporation (ONGC) plunged more than 2% today after it was reported that the company is facing a repeat of the Krishna Godavari (KG) basin fiasco in Iran. ONGC alleges that 11.12 billion cubic meters of natural gas worth Rs 110.55 billion has flowed from its idling KG basin blocks in Bay of Bengal blocks to neighboring KG-D6 fields of Reliance Industries. The same is now on the verge of repeating in the Farzad-B field with Saudi Arabia in the Persian Gulf, which it had discovered in 2008 but no contract to exploit the 12.5 trillion cubic feet (Tcf) of recoverable reserves has so far been concluded with Iran.
Reportedly, a portion of Farzad-B field extends into territorial waters controlled by Saudi Arabia. Saudi Arabia has already drilled wells on the area falling in its territory, which it has named Hasbah field, and has begun production. The two fields are connected, with the area falling in Iranian territory holding larger share of 12.5 Tcf of recoverable reserves while the Saudi territory has only 3 Tcf or so. But the two fields are connected and whosoever is able to movefirst would extract more benefits.
According to the reports, it was expected that Prime Minister Narendra Modi’s visit to Tehran today and tomorrow may see finalizing of a contract, giving developmental rights of Farzad-B field to ONGC Videsh Ltd, the overseas subsidiary of ONGC. But Iran is yet to agree to US$ 4.3 billion development plan submitted by OVL.
Oil and gas stocks languished in red today, with ONGC and HPCL leading the losses.
Moving on to news from mining sector. According to a leading economic daily, Vedanta Resources plans to ramp up aluminum production from Jharsuguda and Korba smelters of Bharat Aluminum Co to 1.5 million tonnes (mt) from 0.9 mt this financial year.
Oil prices slipped in Asian trade on a strong dollar and signs that global crude supply is holding up even as volumes hit by unplanned outages rise to at least 5-year highs.
Shares of Power Grid surged 2.6% to Rs.148 on BSE. The company will replace BHEL in the BSE Sensex index from June 20. Following the development, shares of BHEL slipped 0.6% Rs.118 on BSE.
USDINR trade today trading up 4 paise at 67.40 per US dollar.
Out of 1,394 stocks traded on the NSE, 839 declined and 508 advanced today.
Top 5 Nifty Gainers: NTPC (2.98%), Tata Motors (1.62%), Cipla (1.09%), ICICI Bank (1.06%) and Reliance Ind. (1.05%).
Top 5 Nifty Losers: ONGC (-1.44%), BHEL (-1.35%), Adani Ports & Sez (-1.10%), Sun Pharma (-1.08%) and L&T (-1.03%),
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