Post Session: Quick Review

After snapping seven consecutive sessions’ winning streak in the previous trading session, local equity markets ended downbeat for yet another session with losses of over 3/4th of a percent that dragged both Sensex and Nifty below psychologically crucial 29,000 and 8,800 levels respectively. Intra-day trend reversal which took place in the second half of the trading session mainly dragged the benchmarks to day’s low point by close of trade as prevailing caution ahead of Budget 15-16, which is scheduled to take place by end of this week mainly underpinned investors to wind down their long positions. Much of the drubbing came from index heavyweight stocks of Reliance Industries, HDFC, HDFC Bank and ONGC among others which ended lower with losses in the range of 0.50%- 2%. Meanwhile, broader indices also succumbing to selling pressure, ended with cut of over 0.35%-0.85%.

On the global front, Asian markets mostly rose on the first trading day of the Year of the Sheep, buoyed by a bailout deal between Greece and the euro zone last week. However, trading volumes remain light with China, Taiwan and Vietnam still closed for the Chinese New Year holiday. Meanwhile, European shares rose on Monday, with Germany's share index hitting a new all-time high and Britain's FTSE trading just below a record peak after Athens clinched a deal on Friday to avoid a banking collapse by accepting a conditional extension of its bailout programme. The accord requires Greece to submit by Monday a letter to the Euro group listing all the policy measures it plans to take during the remainder of the bailout period.

Closer home, all the sectoral indices on BSE surrendering to selling pressure, ended the downbeat session of trade into negative territory, nevertheless prominent losers were the stocks from Consumer Durables, Oil & Gas and Realty counters. In stock-specific activity, Shares of Jindal Steel & Power and DLF plunged over 2.5% after NSE decided to exclude both stocks from CNX Nifty 50. The overall market breadth on BSE was in the favour of decliners, which thumped advances in the ratio of 1199:1697, while 120 shares remained unchanged (Provisional).

The BSE Sensex ended at 28975.11, down by 256.30 points or 0.88% after trading in a range of 28913.16 and 29362.96. There were 6 stocks advancing against 24 stocks declining on the index. (Provisional)

The broader indices ended in the red; the BSE Mid cap index was down by 0.84%, while Small cap index down by 0.32%. (Provisional)

The losing sectoral indices on the BSE were Consumer Durables down by 1.99%, Oil & Gas down by 1.91%, Realty down by 1.32%, FMCG down by 1.26% and Bankex down by 0.88%, while there were no gainers on the index. (Provisional)

The top gainers on the Sensex were Mahindra & Mahindra up by 1.19%, TCS up by 0.72%, Sesa Sterlite up by 0.64%, Larsen & Toubro up by 0.37% and NTPC up by 0.31%. On the flip side, Reliance Industries down by 2.78%, GAIL India down by 2.69%, SBI down by 2.43%, Tata Steel down by 2.40% and Axis Bank down by 2.21% were the top losers. (Provisional)

Meanwhile, after yielding close to a lakh crore from the sale of coal blocks, the government is now looking to garner similar amount of money from the sale of radio-waves with eight telecom operators depositing about Rs 20,435 crore as earnest money for spectrum, thereby reflecting fierce bidding which is likely to take place for the spectrum auction starting March 4. Otherwise, for the entire amount of spectrum put on auction, an earnest money deposit (EMD) of Rs 12,000 crore would have served the purpose.

Based on the reserve price, the government estimated to garner over Rs 82,000 crore from the sale of radio-waves for providing 2G as well as 3G services. While, the auction of 2G spectrum in 800 MHz, 900 Mhz and 1800 MHz bands at the reserve price is expected to fetch the government Rs 64,840 crore, it is looking at raising Rs 17,555 crore at the minimum on auction start price for the 2,100 Mega-Hertz band or 3G spectrum. However, with record EMD, the final earnings could be more than Rs 1 lakh crore.

RJio has submitted the highest EMD of about Rs 4,500 crore, followed by Bharti Airtel Rs 4,336 crore, Idea Cellular Rs 4,000 crore, Vodafone Rs 3,700 crore, Tata Teleservices Rs 1,500.25 crore, Reliance Communications Rs 1,175 crore, Uninor Rs 724.95 crore and Aircel Rs 500 crore.

Notably, the government received EMD of Rs 8759.75 crore from eight companies for the auction conducted in February 2014 , while In 2010, nine telecom companies jointly submitted EMD of Rs 3,515 crore for 3G auctions and 11 companies Rs 2,291.25 crore for broadband wireless access spectrum that can be used for 4G services.

India VIX, a gauge for markets short term expectation of volatility surged 1.79% at 21.65 from its previous close of 21.27 on Friday. (Provisional)

The CNX Nifty ended at 8754.95, down by 78.65 points or 0.89% after trading in a range of 8736.10 and 8869.00. There were 8 stocks advancing against 42 stocks declining on the index. (Provisional)

The top gainers on Nifty were Power Grid up by 1.73%, Kotak Mahindra Bank up by 1.43%, Sesa Sterlite up by 1.04%, TCS up by 0.79% and Mahindra & Mahindra up by 0.74%. On the flip side, Zee Entertainment down by 3.96%, NMDC down by 3.44%, DLF down by 3.17%, Lupin down by 2.51% and Reliance Industries down by 2.48% were the top losers. (Provisional)

European Markets were trading mostly in the green; France's CAC was up 0.23% and Germany's DAX was up by 0.33%, while UK's FTSE 100 was down by 0.21%.

The Asian indices ended mostly in green on Monday, after board minutes from Bank of Japan raised questions about the scope of government bond buying and broad market support. The markets in China and Taiwan remain closed for the Lunar New Year holiday. Some of Bank of Japan board members stated that the pace of massive Japanese government bond buying may need to stop before reaching a 2% sustained inflation goal, according to minutes published of the January meeting. The board members also added that falling oil prices should be reflected in inflation expectations, but that the underlying trend of moving from a deflation mindset is progressing steadily. It was the first time that board members had referred to the feasibility of continuing the key part of its nearly two-year-old quantitative and qualitative easing (QQE). Japan’s All Industries Activity Index fell to a seasonally adjusted -0.3%, from 0.0% in the preceding month whose figure was revised down from 0.1%.