Post Session: Quick Review

After witnessing sharp correction of around 1.5% in previous session, local barometer gauges continuing their southbound journey, offloaded another 0.15% on Monday on growing concerns of rising oil prices, which threatened to put pressure on domestic inflation and aggravate Current Account Deficit (CAD). Though, some recovery attempts were witnessed in the last hour of trade, they turned out to be lackadaisical, as benchmark equity indices logged yet another negative session of trade. Trades at Dalal Street took a turn for the worse with annual rate of inflation, based on monthly WPI, accelerating to at highest level since December 2013, at 6.01% for month of May, 2014, as compared to 5.20% and 4.58% during corresponding month in the previous year, which was also higher than street expectation. Nevertheless, the mood right from the start of trade remained downbeat on account of weak global cues. However, recovery which was witnessed in the dying hours of trade, took Sensex and Nifty above psychologically crucial 25,200 and 7,500 levels respectively. Meanwhile, broader indices showing a degree of outperformance, settled with gains in the range of 0.25%0.35%.

On the global front, Asian pacific shares struggled on Monday on the back of fears of escalating conflict in Iraq disrupting oil supplies, however among rest, Composite Index turned out to be to be exception in the wake of comments from Chinese Premier Li Keqiang said he was confident the world's second largest economy would hit its growth target 7.5%. Meanwhile, European shares too receiving a negative hand over from Asian pacific shares, were trading lower on Iraq turmoil.

Closer home, despite the weakness, most of the sectoral indices on BSE managed to end in positive territory, with the prominent gainers being the stocks from Realty, Information Technology and Technology counters. Shares in exporters gained after the rupee weakened to its lowest level in more than a month on Monday as these companies realize better margins if the rupee remains weak. Additionally, shares of all three listed state-owned oil marketing companies (OMCs) erasing their entire early morning losses, bounced back in trade after the government said under-recovery on high speed diesel declined further to Rs 1.62 per litre from Rs 2.80 per litre earlier. On the flip side, stocks from Auto, Capital Goods and Banking counters were the laggards of the session. Banking shares took a hit for the worst after higher headline inflation data dampened the chances of RBI slashing key policy rates in its monetary policy in August. The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 1380:1570, while 119 scrips remained unchanged. (Provisional)

The BSE Sensex lost 37.69 points or 0.15% to settle at 25228.17. The index touched a high and a low of 25268.41 and 25063.93 respectively. Among the 30-share Sensex, 14 stocks gained, while 16 stocks declined. (Provisional)

The broader indices, however, outperformed benchmarks and ended in the green; the BSE Mid cap index was up by 0.35% and Small cap index was up by 0.31%. (Provisional)

On the BSE Sectoral front, Realty up by 1.70%, IT up by 1.54%, TECk up by 1.24%, Healthcare up by 0.73% and Infrastructure up by 0.53% were the gainers while, Capital Goods down by 1.16%, Auto down by 1.07% and Bankex down by 0.52%, were the top losers in the space. (Provisional)

The top gainers on the Sensex were Gail up 4.13%, TCS up 2.45%, Sun Pharma up by 2.40%, Infosys up by 1.87% and BHEL up by 1.60%. On the flip side, the key losers were Axis Bank down by 4.81%, M&M down by 4.70%, L&T down by 4.56%, HDFC down by 4.40% and Tata Motors down by 3.91%. (Provisional)

Meanwhile, India’s services exports in the first month of 2014-15 stood at $13.63 billion, marginally lower than $14.32 billion in March 2014, as per Reserve Bank's data on International Trade in Services. However, services imports in April 2014 also were lower at $ 8.06 billion, from its previous month, when it stood at $8.49 billion in March. For the previous fiscal, India's services exports stood at $167.01 billion while imports were at $88.19 billion.

The RBI releases the provisional aggregate monthly data on India's international trade in service sector, which contributes to country's gross domestic product, in span of 45 days.

Meanwhile, showing some signs of recovery and stabilization, the activity in Indian services sector, increased in the month of May on the back of rise in new orders. Witnessing first expansion in output in 11 months, the HSBC services Purchasing Managers’ Index (PMI), based on the survey of around 350 private service sector companies rose to 50.2 in May from 48.5 in the previous month, above 50 mark that separates growth from contraction.

However, the Indian services companies maintained their positive outlook for output growth over the next 12 months on the back of supportive factors such as end of the elections, planned increases in marketing budgets, the launch of new services and forecasts of stronger demand. The service sector activity is likely to surge in coming future supported by the strong election results.

India VIX, a gauge for markets short term expectation rose 1.23% at 17.98 from its previous close of 17.76 on Friday. (Provisional)

The CNX Nifty declined 8.55 points or 0.11% to settle at 7,533.55. The index touched high and low of 7,548.60 and 7,487.55 respectively. Out of 50 stocks in Nifty, 23 stocks ended in the green and 27 in red. (Provisional)

The major gainers of the Nifty were Gail up 4.77%, BPCL up by 3.29%, TCS up by 2.55%, Sun Pharma up by 2.43% and DLF up by 2.42%. On the flip side, the key losers were M&M down by 2.94%, Axis Bank down by 2.54%, L&T down by 2.32%, HDFC Bank down by 2.01% and Tata Motors down by 1.97%. (Provisional)

European markets were trading in red; UK’s FTSE 100 down by 0.23%, Germany’s DAX down by 0.29% and France’s CAC 40 was down by 0.46%.

The Asian markets concluded Monday’s trade mostly in red, as concerns over escalating violence in Iraq weighed on sentiment. Markets continued to monitor events in Iraq as militants linked to al-Qaeda threatened to take Baghdad after capturing key cities elsewhere in the country over the weekend. The number of private homes sold by developers in Singapore in May was the highest monthly figure in almost a year. Developers sold 1,470 units last month, a 0.8 percent rise compared to 1,459 units in May 2013. The level of sales was nearly double April’s figure of 749 and was the highest since June 2013 when 1,806 units were sold. Singapore has taken steps to cool the housing market, and property prices have fallen for the past two quarters. Hong Kong’s gross national income rose 3.5% year-on-year to $537.3 billion in the first quarter, while Gross Domestic Product grew 4.6% to $530 billion. Hong Kong’s GNI was larger than its GDP by $7.3 billion, representing a net external primary income inflow of the same amount, and equivalent to 1.4% of GDP in that quarter.