Post Session: Quick Review

Indian equity markets finally saw the light of the day after five straight sessions of fall as market-participants lapped up select fundamentally strong blue chip stocks, which were available at attractive valuations after last few sessions’ drop. However, most of the gains evaporated in the last hour of trade as bout of selling which took place at higher levels dragged the markets’ off their highs, leaving just about a flat but positive close as sentiment remained broadly weak ahead of the conclusion of elections later this month.

By close of trade, both Sensex and Nifty settled below the crucial 22,450 and 6,700 levels respectively, with slender gains. Nevertheless, there was absence of any participation of broader indices, since both Midcap and Small-cap indices went home with loss in the range of 0.15%-0.45%.

On the global front, Asian share ended mixed on Monday after a survey of Chinese manufacturing disappointed, while the simmering conflict in Ukraine also weighed on the sentiment. Early gains evaporated after HSBC's final reading of its April PMI for manufacturers in China eased back to 48.1 from a preliminary reading of 48.3. The survey showed factory activity in the world's second largest economy contracted for a fourth consecutive month in April, though the index was up a tick on eight-month low seen in March. Additionally, worries over China and Ukraine also pegged back European shares.

Closer home, markets after making a soft start and subsequent retreat in early deals, went on gradually adding gains to soar near day’s high in afternoon deals despite not so positive start of European markets, with UK’s equity markets even being shut for trade on Early May Bank Holiday, however last hour selling pressure which crept at higher levels, pared significant portion of bourses’ gains.

Sectorally, stocks from Oil & Gas counter witnessed maximum demand, followed by Metal and Capital Goods. On the flip side, stocks from Technology, IT and Realty counters were the major losers on the index. IT stocks sank after rupee appreciated for fourth consecutive session and strengthened near 60/$ level, in intra-day trade on Monday. On the flip side, while banking stocks gained after Canara Bank reported its Q4 earnings, which took its stocks higher over 6%. Canara Bank posted 15.79% fall in its net profit at Rs 610.83 crore for the quarter ended March 31, 2014, though stocks moved higher by over 7% after the bank said its net non-performing assets (NPA), as a percentage of total assets, declined to 1.98% in March quarter from 2.39% in the previous quarter ended December 2013.The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 1255:1489, while 127 scrips remained unchanged. (Provisional).

The BSE Sensex gained 41.23 points or 0.18% to settle at 22445.12. The index touched a high and a low of 22592.03 and 22354.45 respectively. Among the 30-share Sensex, 16 stocks gained, while 14 stocks declined. (Provisional)

The BSE Mid cap and Small cap indices ended lower by 0.13% and 0.46% respectively. (Provisional)

On the BSE Sectoral front, Oil & Gas up by 1.53, Metal up by 1.21%, Capital Goods up by 0.91%, PSU up by 0.65% and FMCG up by 0.50% were the gainers while, TECK down by 1.16%, IT down by 0.96%, Realty down by 0.75%, Health Care down by 0.72% and Power down by 0.47% were the top losers in the space. (Provisional)

The top gainers on the Sensex were Hindalco Inds up by 4.42%, ONGC up by 2.10%, L&T up by 1.73%, RIL up by 1.58% and Tata Steel up by 1.47% while, Cipla down by 2.34%,HDFC down by 2.15%, Tata Power down by 1.94%, Wipro down by 1.56% and Infosys down by 1.51% were the top losers in the index (Provisional).

Meanwhile, Finance Minister P Chidambaram has emphasised the need to increase investments, especially in infrastructure sector to revive India’s economic growth. At present, Indian economy is struggling with slowdown and its growth has slowed down to a decade low of 4.5 percent in FY13 and was at 4.6 percent during the first three quarter of FY14.

The Finance Minister added that the global economy has shown signs of strengthening over the past few months and policies to revive growth in most emerging markets, including India, will have to be rooted in increasing investments, particularly in infrastructure. Chidambaram further asserted that as most of the emerging markets are resource constrained, it is necessary to have recourse to foreign savings for investment and urged the Asian Development Bank to increase its annual lending capacity to $ 20 billion in the next ten years. Finance Minister further stated that the fund flow to emerging countries should be stable adding that the best option would be investment flows through Foreign Direct Investment (FDI).

The infrastructure development is a most critical prerequisite to boost the economic growth. However, the government has been taking various measures to boost the infrastructure sector’s growth.  It has set the $1-trillion investment target for the 12th Five Year Plan (2012-17) to overhaul its infrastructure sector such as ports, airports and highways to boost growth. Further, in order to expedite the implementation of infra projects, the government has set up Cabinet Committee on Investment (CCI). Till January 2014, the CCI had cleared around 296 projects with estimated project cost of Rs 6,60,000 crore.

India VIX, a gauge for markets short term expectation gained 3.42% at 34.19 from its previous close of 33.05 on Friday. (Provisional)

The CNX Nifty gained 4.55 points or 0.07% to settle at 6,699.35. The index touched high and low of 6,741.05 and 6,680.45 respectively. Out of 50 stocks in Nifty, 25 stocks ended in the green and 25 in red.

The major gainers of the Nifty were Hindalco up 5.13%, Jindal Steel up by 2.01%, Tata Steel up by 1.77%, Reliance up by 1.76% and ONGC up by 1.73%.  The key losers were HCL Tech down by 3.21%, HDFC down by 2.64%, Cipla down by 2.23%, Tata Power down by 1.93% and NMDC down by 1.84%. (Provisional)

Most of European markets were trading in red; France’s CAC 40  and Germany’s DAX was down by 1.10% and 1.47% respectively.

The Asian markets concluded Monday’s trade on mixed note, after a closely watched survey indicated manufacturing activity in China slowed more than first thought in April, while the simmering conflict in Ukraine also weighed on the sentiment. Japanese and South Korean markets were shut for trade on account of ‘Children’s Day’ holiday. China’s manufacturing sector contracted for a fourth consecutive month in April, the latest sign that the world’s second-largest economy is slowing. The HSBC purchasing managers index (PMI) came in at 48.1 for last month, a tad up from 48.0 in March but weaker than the 48.3 reported in its preliminary report on April 23. Indonesia’s economy grew at a much slower than expected pace in the first quarter as investments and exports weakened. Gross Domestic Product (GDP) in the January to March quarter rose 5.21% from a year earlier, against 5.72% in the fourth quarter. On a quarterly basis, the economy expanded 0.95%.

In Hong Kong, the total retail sales value in March, provisionally estimated at $39.6 billion, fell 1.3% over the same month last year. The revised estimate of the combined total retail sales value in the first two months rose 6.7% year-on-year, while that of the first quarter increased 4.2%. Separately, the Inland Revenue Department received $243.5 billion in tax revenue in 2013-14, setting another record high after the 2012-13 collection year.