Post Session: Quick Review

Local equity markets, which showed signs of fatigue from start of trade, snapped previous two consecutive sessions’ record-breaking run and overall six straight sessions of bull-run on Wednesday, which saw both Sensex and Nifty slipping below the psychologically crucial 26,400 and 7,900 levels respectively, with loss of around four tenths of a percent. Markets right from the start of trade remained dejected and for once did not attempt for recovery, with market-participants clearly steering away from equities in absence of positive trigger at home front and negative European counterparts. However, broader indices showcasing resilience, concluded up with gains in the range of 0.05%-0.95%.

On the global front, Asian pacific stocks concluded mostly higher on Wednesday on account of strong U.S. housing data which lifted Wall Street shares, while receding geopolitical tensions stemming from the Ukraine conflict that underpinned risk appetite, also aided sentiment. On the flip side, European shares dipped in early trade on Wednesday, ending a sharp two-day rally, as investors were rattled after Carlsberg issued a profit warning, blaming deteriorating conditions in Russia. Meanwhile, investors in the European region were also cautious ahead of the U.S. Federal Reserve's minutes of its July policy meeting which could give insight on the outlook for interest rates. Closer home, sentiment also soured in trade after Asian Development Bank underscored that a global failure to respond to climate changes could result in about 8.7% economic loss in India`s Gross Domestic Product (GDP) by 2100. Further, growth of mere 3.9% in indirect tax collection in the April-July quarter of the current fiscal due to decline in custom duty and excise duty collections, also weighed on the sentiment.

On the BSE, majority of sectoral indices lost to red, nevertheless, prominent losers were stocks from Oil & Gas, Public Sector Undertaking and Fast Moving Consumer Goods counters. On the flip side, stocks from Power, Realty and IT counters were the notable gainers of the session. In stock specific activity, banking stocks turned soured after sharp plunge of two state run bank shares, Oriental Bank of Commerce (OBC) and Dena Bank after reports suggested that the Union finance ministry has unearthed a scam involving these banks. Further, as per the reports, the ministry ordered a forensic audit and referred the case involving Oriental Bank to the Central Bureau of Investigation (CBI). Additionally, Oil marketing companies' stocks, BPCL, HPCL and IOC, which were trading upbeat for previous two trading session, succumbed to selling pressure in today’s trading session after reports suggested delayed prospect of deregulation of the nation's most consumed fuel, losses on sale of diesel have risen to Rs 1.78 per litre after dipping to an all-time low of Rs 1.33 a litre in first half of August. Bucking the stock market trend, drug makers' shares rose as investors sought shelter in defensive bets. Ranbaxy Laboratories, Glenmark Pharmaceuticals, Cadila Healthcare all rallied in the range of 1%-4%. The market breadth on the BSE remained in the favour of advances; advances and declining stocks were in a ratio of 1689:1289, while 109 scrips remained unchanged. (Provisional)

The BSE Sensex declined 106.38 points or 0.40% to settle at 26314.29. The index touched a high and a low of 26504.52 and 26277.61 respectively. 9 stocks gained against 21 declines on the index. (Provisional)

The broader indices were trading in green; the BSE Mid cap index was up by 0.06%, while Small cap index up by 0.93%. (Provisional) 

On the BSE sectoral front, Power up by 0.73%, Realty up by 0.52%, IT up by 0.23% and TECK up by 0.10% while, Oil & Gas down by 1.32%, PSU down by 0.86%, FMCG down by 0.70%, Auto down by 0.56% and Capital Goods down by 0.51% were the losing indices on BSE. (Provisional)

The top gainers on the Sensex were Sun Pharma Industries up by 4.88%, Cipla up by 3.35%, Dr. Reddys Lab up by 2.23%, Tata Power up by 1.62% and BHEL up by 1.12%. On the flip side, ONGC down by 2.80%, Tata Motors down by 1.47%, Axis Bank down by 1.38%, Larsen & Toubro down by 1.34% and Reliance Industries down by 1.29% were the top losers. (Provisional)

Meanwhile, the Asian Development Bank (ADB), in its latest report, highlighted that global failure to respond to climate changes could result in about 8.7 percent economic loss in India's Gross Domestic Product (GDP) by 2100. Manila based multi-lateral funding agency in its report titled 'Assessing the Costs of Climate Change and Adaptation in South Asia' predicted that as the country’s economy depends upon the agriculture sector, India is likely to get impacted adversely by global climate change and would see economic losses equivalent to 1.8 percent of annual GDP by 2050 widening to 8.7 percent by the end of the century.

The report further highlighted that agriculture provides employment and livelihood opportunities to most of India's rural population and changes in temperature and rainfall and an increase in floods and droughts linked to climate change would have a devastating impact on people's food security incomes, and lives. The report added that India has 8,000 km of coastline and nearly half the country's 28 states could face serious consequences from a rise in the sea level. Prolonged droughts and higher temperatures will put immense strain on limited water resources and increase competition between agriculture and energy sectors in the country.

Regarding south Asian countries, the ADB stated that climate change will cut South Asia's growth almost 9 per cent by the end of the century. However,  if countries act together to keep the rise in global temperatures below 2.5 degree Celsius, the cost of shielding the region from the climate change impacts would be nearly halved to around $40.6 billion, or 0.48 percent of GDP by 2100. South Asia will need to spend at least $73 billion or an average of 0.86 percent of its GDP, every year between now and 2100 on adaptation measures.

India VIX, a gauge for markets short term expectation of volatility declined 1.76% at 13.66 from its previous close of 13.90 on Tuesday. (Provisional)

The CNX Nifty ended lower by 22.20 points or 0.28% to settle at 7875.30. The index touched high and low of 7922.70 and 7864.05 respectively. 18 stocks ended in the green against 32 stocks ending in red. (Provisional)

The top gainers on Nifty were Sun Pharma Industries up by 4.59% and Cipla up by 3.75% and Lupin up by 2.30% and Tata Power up by 2.16% and Dr. Reddys Lab up by 1.98%. On the flip side, ONGC down by 2.57%, IDFC down by 1.54%, Tata Motors down by 1.27%, Ultratech Cement down by 1.26% and Mahindra & Mahindra down by 1.22% were the top losers. (Provisional)

European markets were trading in the red; France’s CAC 40 was down by 0.49%, UK’s FTSE 100 was down by 0.33% and Germany’s DAX was down by 0.50%.

Asian equity indices ended mostly in green on Wednesday, after strong US housing data lifted Wall Street shares. Japan’s exports rose in July for the first time in three months in a tentative sign that demand overseas is starting to recover, which could raise hopes that exports can offset a slump in consumer spending. The export data will be a relief for the Bank of Japan, which has predicated its economic growth and inflation forecasts on a rapid rise in exports as part of the government’s ‘Abenomics’ plan to energize the Japanese economy. The 3.9% annual rise in July was roughly in line with a 3.8% increase expected. Japan’s trade balance rose to a seasonally adjusted -1.02T, from -1.07T in the preceding month whose figure was revised up from -1.08T. Japan’s All Industries Activity Index fell to a seasonally adjusted -0.4%, from 0.6% in the preceding month. In Hong Kong, the composite interest rate slipped to 0.45% at the end of July from 0.47% at the end of June. The Monetary Authority stated that the drop reflected a moderate decrease in the weighted funding cost for deposits.