Benchmarks snap six-day winning streak

Snapping their six-day winning streak, Indian equity benchmarks ended the choppy day of trade slightly in the red as investors opted to book profit amid feeble global cues. Moreover, investors would take cues from earnings with Infosys kicking off the December-quarter result season on Friday. Bourses, after making a good start scaled their highest in nearly a month in intra-day session of trade but, turned flattish in noon deals as investors opted to book some profit off the table at high point of day’s trade. However, profit booking emerged in last leg of trade mainly dragged the markets into negative territory.

Losses remained capped as some support came from on reports that foreign portfolio investors bought shares worth a net Rs 259.82 crore on January 2, 2015, as per provisional data. Meanwhile, it has been reported that to boost manufacturing growth under ‘Make in India’ programme, industry leaders and top government officials have suggested duty cuts, easier land acquisition norms and fiscal incentives for research and development especially in sectors like defence.

On the global front, European markets made choppy start with most of the indices were trading in the red in early deals as worries over Greece’s future in the euro zone kept shares under pressure on Monday. Political uncertainty in Greece was firmly in the spotlight ahead of elections later this month as German Vice-Chancellor Sigmar Gabriel said the German government wanted Greece to stay in the euro zone. Asian stocks ended the session mostly in the negative terrain, following a weak lead from Wall Street and continued jitters in the oil market.

Back home, depreciation in Indian rupee against dollar dampened the sentiments. The partially convertible rupee was at 63.34 per dollar at the time of equity markets closing as compared with its previous close of 63.30. Meanwhile, banking stocks fell after a two-day meeting of public sector banks convened by Prime Minister Narendra Modi ended with an announcement that state-owned lenders needed more autonomy but without any details of proposed reforms.

On the flip side, Capital Goods stocks gained on robust PMI data for the month of December which was at its highest since end-2012. Shares of three public sector oil marketing companies remained on buyers’ radar as Brent crude futures dropped to fresh 5-1/2-year lows, January 5, 2014. Additionally, Shares of two state-run upstream oil exploration companies edged higher on hopes of lower subsidy burden as crude oil prices declined.

The NSE’s 50-share broadly followed index Nifty lost around twenty points to end below the psychological 8,400 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex dropped by over forty points but managed to hold its crucial 27,800 mark. Broader markets, however, outperformed benchmarks and ended the session slightly in the green. The market breadth remained in favour of advances, as there were 1545 shares on the gaining side against 1420 shares on the losing side while 124 shares remain unchanged.

Finally, the BSE Sensex declined by 45.58 points or 0.16%, to 27842.32, while the CNX Nifty dropped by 17.05 points or 0.20% to 8,378.40.

The BSE Sensex touched a high and a low of 28064.49 and 27786.85, respectively. The BSE Mid cap index was up by 0.16%, while the Small cap index was up by 0.11%.

The top gainers on the Sensex were Maruti Suzuki up by 2.62%, Tata Motors up by 2.42%, Tata Steel up by 1.42%, Larsen & Toubro up by 1.42% and ONGC up by 1.15%. On the flip side, Dr. Reddys Lab down by 2.19%, Bharti Airtel down by 2.10%, Hindalco down by 1.87%, HDFC down by 1.29% and TCS down by 1.28% were the top losers.

On the BSE Sectoral front Auto up by 1.14%, Consumer Durables up by 1.11%, Capital Goods up by 0.73%, Realty up by 0.22% and FMCG up by 0.22% were the top gainers, while TECK down by 1.07%, IT down by 1.01%, Metal down by 0.45%, Healthcare down by 0.26% and Bankex down by 0.25% were top losers in the space. 

Meanwhile, retaining its earlier decision on net worth eligibility of bidders, Telecom panel reiterated that only telecom players with net worth of over Rs 100 crore, irrespective of whether they were holding spectrum or license or were new entrants in a band or a circle, could participate in the upcoming airwave auction. However, for the North East region and J&K service area, the net worth requirement for companies has been fixed at Rs 50 crore.

According to the telecom panel, strong balance sheets of telecom players bidding for airwaves would ensure efficient roll out of quality telecom services. With this, telecom operators like Aircel and Tata Teleservices (TTL) would find it difficult to bid for airwaves in the coming auction.

However, as per few media reports, note on the minutes of IMC meeting, held late last month, suggested that the committee had decided to hold on to its earlier view on the net worth as it felt lower availability of funds with a bidder would lower its capacity to raise funds, which in turn could hamper smooth running of its operation, expansion plans and quality of service. Nevertheless, Telecom Panel also cited government's Digital India initiative as a reason crucial enough to ensure the financial strength of bidder for quick roll out of services.

The CNX Nifty touched a high and low of 8,445.60 and 8,363.90 respectively.

The top gainers on Nifty were Maruti Suzuki India up by 2.63%, Tata Motors up by 2.40%, Tata Steel up by 1.75%, Larsen & Toubro up by 1.59% and IDFC up by 1.42%. On the flip side, DLF down by 2.69%, Dr. Reddy's Laboratories down by 2.34%, Bharti Airtel down by 2.15%, Hindalco Industries down by 1.94% and Tech Mahindra down by 1.84% were the top losers.

European Markets were trading in the red; UK's FTSE 100 was down by 0.48%, France's CAC was down by 0.16% and Germany's DAX was down by 0.09%.

The Asian equity benchmarks ended mostly in red on Monday, with Japanese stocks closing lower on the first trading day of the year after fluctuating though out the day. An economic rebound and loose money policy under Prime Minister Shinzo Abe briefly halted a long slide in Japan’s commercial property market, but the benefits of Abenomics appear increasingly limited to Tokyo, leaving a moribund hinterland. Japanese manufacturing activity showed sustained growth in December, suggesting domestic demand continues to recover after the economy fell into a surprise recession last year. The final Markit/JMMA Japan Manufacturing Purchasing Managers Index (PMI) was 52.0 in December, slightly less than a preliminary reading of 52.1 and unchanged from the final reading in November.

South Korea received a record high $19 billion in pledges of foreign direct investment during 2014, as interest from Europe and China surged. The total is 30.6 percent higher than in 2013, when there were pledges of about $14.6 billion. Pledged inflows from the European Union, the largest foreign investor in South Korea, grew 35 percent to $6.5 billion while those from China rose 147 percent to $1.2 billion. Thailand CPI fell to a seasonally adjusted annual rate of 0.60%, from 1.26% in the preceding month.