Post Session: Quick Review

In the extremely volatile session of trade, local equity markets concluded with slender gains of over one tenth of a percent, which lifted both Sensex and Nifty above psychologically crucial 26,600 and 7,950 levels respectively by close of trade on Tuesday. Lower level buying which came during dying hours of trade mainly led to some recovery of frontline equity indices, which otherwise were set to clock yet another disappointing session of trade. RBI’s status quo stance in its fourth bi-monthly monetary policy review largely turned out to be non-event for the markets. Though, markets rose in a knee jerk reaction to the release of monetary policy, all the gains were erased after central bank, in its monetary policy review said upside risks to its January 2016 inflation target of 6% are significant and its future policy stance will be influenced by this inflation target. In a bid to maintain financial and price stability, the RBI in its fourth bi-monthly monetary policy review, as widely expected, kept its key policy repo rate unchanged at 8%. Consequent to which the reverse repo rate under the LAF stood unchanged at 7.0%, and the marginal standing facility (MSF) rate and the Bank Rate at 9.0% respectively. Nevertheless, recovery which took place in the dying moments of trade acted as saving grace for local equity markets. Meanwhile, broader indices, contrary to frontline indices, went home with gains of over one tenths of a percent.

On the global front, Asian markets mostly slipped on Tuesday, with Hong Kong hit for a second day as a pro-democracy protest showed no signs of abating and a gauge of Chinese manufacturing came in below forecast. However, European shares edged higher on Tuesday ahead of euro-zone inflation data that could be crucial to the European Central Bank's next move. Eurozone consumer price inflation is expected to slow to 0.3% year-over-year in September, well below the ECB's target of close to 2%.

Closer home, despite slender gains of local equity market, most of the sectoral indices concluded into negative territory, nevertheless stocks from Realty, Power and Metal counters were the prominent losers of the session. On the flipside, stocks from Consumer Durable, Healthcare and Oil & Gas counter were the top gainers of the session. In stock-specific activity, tyre stocks were on roll amid declining domestic rubber prices. As per reports, rubber price, which ruled around Rs 220 per kg in January 2011, has now touched a low of Rs 123 per kg in the domestic market due to lower demand for the commodity in the wake of general economic slowdown and lower price in international market. Additionally, Jewellery makers and sugar stocks were trading higher ahead of Diwali. The market breadth on the BSE remained in the favour of decliners; where advancing and declining stocks were in a ratio of 1355:1535, while 99 scrips remained unchanged. (Provisional)

The BSE Sensex ended higher by 33.40 points or 0.13% at 26630.51 after trading in a range of 26481.31 and 26851.33. There were 13 stocks advancing against 16 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.14%, while Small cap index up by 0.13%. (Provisional)

The few gaining sectoral indices on the BSE were Consumer Durables up by 1.75%, Healthcare up by 1.35%, Oil & Gas up by 1.14% and FMCG up by 0.66% while, Realty down by 2.66%, Power down by 1.22%, Metal down by 0.96%, Capital Goods down by 0.58% and Infrastructure down by 0.57% were the losing indices on BSE. (Provisional)

The top gainers on the Sensex were Sun Pharma up by 2.67%, HDFC up by 2.35%, Bajaj Auto up by 2.14%, Maruti Suzuki up by 1.81% and Cipla up by 1.60%. On the flip side, BHEL down by 3.55%, Axis Bank down by 2.12%, Tata Steel down by 1.94%, ICICI Bank down by 1.88% and Hindalco down by 1.85% were the top losers. (Provisional)

Meanwhile, bullish on opportunities in India, Pitching for India’s growth story, Prime Minister Narendra Modi, who is on a five-day visit to the United States, assured top American corporate honchos of tax stability and friendlier business environment in the country. In the meeting with a galaxy of American corporate executives, including those from Boeing, PepsiCo, Google, KKR and General Electric, he acknowledged that tax stability was stepping stone for investors’ confidence. Notably, this assertion came at a time when some multinationals, like Vodafone, are caught in legal wrangles over tax matters in the country.

Further, in an attempt to allay concerns over negative impact on coal block judgment, Modi said he wanted to convert this judgment into an 'opportunity to move forward and clean up the past'.

Impressed by this, top US corporates, including Boeing, IBM and BlackRock expressed their keenness to strengthen engagements with the country and expressed their interest to participate in diverse initiatives including those related to smart cities.

India VIX, a gauge for markets short term expectation of volatility declined 1.79% at 13.14 from its previous close of 12.92 on Monday. (Provisional)

The CNX Nifty ended higher by 5.90 points or 0.07% at 7964.80 after trading in a range of 7923.85 and 8030.90. There were 24 stocks advancing against 26 stocks declining on the index. (Provisional)

The top gainers on Nifty were Zee Entertainment up by 3.54%, BPCL up by 2.84%, Sun Pharma up by 2.57%, HDFC up by 2.34% and Bajaj Auto up by 2.02%. On the flip side, DLF down by 4.71%, BHEL down by 3.51%, Power Grid down by 3.08%, ACC down by 2.71% and Jindal Steel & Power down by 2.54% were the top losers. (Provisional)

European Markets were trading mostly in the green; Germany's DAX was up by 0.39% and France's CAC was up by 0.88%, while UK's FTSE 100 was down by 0.10%.

Asian markets ended mostly in red on Tuesday, with the benchmark index heading for its biggest monthly decline since May 2012, amid heightened unrest in Hong Kong and speculation over the timing of US interest-rate increases. Indonesia’s rupiah fell the most in Asia this month as foreign funds pulled money from local stocks in preparation for an increase in US interest rates. China’s vast factory sector showed signs of steadying in September as export orders climbed, easing fears of a hard landing but pointing to a still-sluggish economy facing considerable risks. The final HSBC/Markit Manufacturing Purchasing Managers’ Index(PMI) hovered at 50.2 in September, unchanged from the August reading which was a three-month low, but lower than a preliminary reading of 50.5. A sub-index measuring new export orders, a gauge of external demand, expanded to a 4-1/2-year-high of 54.5, though domestic demand appeared soft.

Japan’s retail sales rose to a seasonally adjusted annual rate of 1.2%, from 0.5% in the preceding month while Japan’s industrial production fell to a seasonally adjusted -1.5%, from 0.4% in the preceding month. The total work force that is unemployed and actively seeking employment in Japan during the previous month fell to a seasonally adjusted 3.5%, from 3.8% in the preceding month. Japanese Household Spending rose to a seasonally adjusted -4.7%, from -5.9% in the preceding month while Japanese Housing Starts rose to a seasonally adjusted -12.5%, from -14.1% in the preceding quarter. Thai Industrial Production rose to a seasonally adjusted -2.7%, from -5.3% in the preceding month whose figure was revised down from -5.2%.