Post Session: Quick Review

Markets after rallying for two straight session, witnessed consolidation on Thursday, which led Sensex and Nifty to conclude flat with positive bias, above the psychologically crucial 25,550 and 7,600 levels respectively. Absence of any positive domestic triggers, somber regional counterparts and prevailing caution ahead of Q1FY15 earnings of country’s largest exporters, Tata Consultancy Service (TCS), which kept market-participants on the tenterhooks, was mainly responsible for sideways performance of local equities.

However, any downside was restricted after latest weather report suggested that with most parts of India now receiving decent rainfall, the monsoon deficiency is expected to be wiped out and reduced to 25% by July-end. Additionally, the session turned out to be yielding for broader indices, which settled with gains of over 1.25%.

On the global front, Asian equities dipped on Thursday amid speculation the U.S. Federal Reserve was tilting towards tighter monetary policy. Additionally, European shares fell on Thursday, with appetite for equities dented by new Western sanctions on Russia and a mixed earnings picture. Stocks with high exposure to Russia were among the top losers after the European Union and the United States increased sanctions on the country.

Closer home, in the lackluster session of trade, majority of the sectoral indices on BSE settled into positive territory, with stocks from Power, Consumer Durables and Capital Goods outperformed rest of the counters. On the flip side, stocks from Realty, Oil & Gas and Auto counters turned out to be worst performers of the session. Auto counters ran out of steam after Bajaj Auto's net profit rose just 0.31% to Rs 739.98 crore on 7.57% increase in total income to Rs 5471.68 crore in first quarter ended June 2014 over the corresponding quarter in the previous year. On the flip side, Power space was boosted after Delhi Electricity Regulatory Commission (DERC) approved tariff hike of 8.32 percent for all three discoms Reliance ADAG-owned discom BSES Yamuna Power (BYPL), BSES Rajdhani Power (BRPL), Tata Power Delhi Distribution Company (TPDDL).  The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1729: 1204, while 113 scrips remained unchanged. (Provisional)

The BSE Sensex gained 11.44 points or 0.04% to settle at 25561.16. The index touched a high and a low of 25613.03 and 25494.46 respectively. Among the 30-share Sensex, 17 stocks gained, while 13 stocks declined. (Provisional)

The BSE Mid cap and Small cap indices ended higher by 1.37% and 1.35% respectively. (Provisional) 

On the BSE sectoral front, Metal up by 2.46%, Power up by 2.36%, Consumer Durables up by 2.11%, Capital Goods up by 1.16% and PSU up by 0.89% were the top gainers, while Realty down by 0.77%, Oil and Gas down by 0.42%, Auto down by 0.16% and Bankex down by 0.01% were the few losers in the space. (Provisional)

The top gainers on the Sensex were Tata Power up 3.96%, Hindalco up by 3.22%, Tata Steel up by 2.82%, Coal India up by 2.75% and NTPC up by 2.66%. On the flip side, the key losers were M&M down by 3.29%, Bajaj Auto down by 2.34%, ONGC down by 1.01%, GAIL down by 0.94% and Maruti Suzuki down by 0.87%. (Provisional)

Meanwhile, the government has cleared the decks for 19 foreign investment proposals, including that of Walt Disney Company and Reckitt Benckiser (India), entailing total investment of Rs 2,326.72 crore. The approvals were granted on the recommendations of the Foreign Investment Promotion Board (FIPB) in its meeting held on June 11.

While, the government gave a green signal to proposal of Walt Disney Company (Southeast Asia) Pte, Singapore for infusing additional capital in UTV Software Communication by way of subscription to equity capital up to Rs 1,100 crore and also making additional investments from time to time, Reckitt Benckise (India)’s proposal entailing Rs 725 crore of investment, too was approved by the government. Reckitt Benckise (India) will acquire 23.72% paid up share capital of Reckitt Benckiser Healthcare India from its foreign investors Reckitt Benckiser (Singapore) Pte, Singapore.

Further, the proposal of Department for International Development, UK for investment into NEEV Fund, proposed to be registered with the SEBI, as a Category I Alternative Investment Fund- Infrastructure Fund also was cleared by the government. Meanwhile, companies’ proposals which were cleared included, TTK Protective Devices (Chennai), BNP Paribas India Holding, Pfizer Limited (Mumbai), News Laundry Media, J2 Global Ireland, Morgan Stanley Global Services Mauritius (Mauritius) and Brightstar Infrastructure (Mumbai).

However, FIPB rejected five FDI projects, with first investment proposal being that of Multi-Commodity Exchange of India (MCX) for a post-facto approval of the foreign investment made by Alexandra Mauritius prior to the period when FDI in commodity exchanges was brought under approval route. Besides, it also rejected foreign investment application of George Institute for Global Health (Hyderabad), BIESSE Manufacturing Company (Bangalore) and three others. Meanwhile, the Finance Ministry deferred decisions on seven FDI proposals, including that of Ahlcon Parenterals (India) (pharmaceutical sector), Indian Rotorcraft (defence) and UBM Medica India (print media) among others.

India VIX, a gauge for markets short term expectation rose 1.59% at 14.96 from its previous close of 14.65 on Wednesday. (Provisional)

The CNX Nifty rose 16.05 points or 0.21% to settle at 7,640.45. The index touched high and low of 7,655.65 and 7,612.70 respectively. Out of 50 stocks in Nifty, 31 stocks ended in the green and 19 in red. (Provisional)

The major gainers of the Nifty were Tata Power up 3.72%, Grasim up by 3.27%, Kotak Bank up by 3.18%, ACC up by 3.06% and Hindalco up by 3.02%. On the flip side, the key losers were M&M down by 3.28%, IDFC down by 2.48%, Bajaj Auto down by 2.34%, DLF down by 1.66% and ONGC down by 1.20%. (Provisional)

European markets were trading in red; UK’s FTSE 100 down by 0.37%, Germany’s DAX down by 0.33% and France’s CAC 40 was down by 0.59%.

The Asian markets concluded Thursday’s trade mostly in red, with Japanese stocks losing, as brokerages fell with shipping companies and the yen advanced. Japan’s Cabinet Office is due to release its monthly economic update today. It will raise its outlook on the world’s third-biggest economy for the first time in six months. China’s stocks fell the most in a week amid concerns new share sales will divert funds from existing equities and auto demand may slump after the government stated that it would stop providing cars to junior officials. China faces what would be the second default in the nation’s onshore bond market after a builder stated that it may fail to make a payment next week, the latest sign of stress in the world’s biggest corporate debt load. Companies in China are facing tougher operating conditions as growth looks set to cool to 7.4% this year, the slowest in more than two decades. Hong Kong Unemployment Rate rose to a seasonally adjusted 3.2%, from 3.1% in the preceding month.