Post Session: Quick Review

Indian equity markets extended gains for second consecutive session on optimism that Budget announcements would increase corporate earnings and push growth after Finance Minister, Jaitley announced Rs 70,000 crore of additional investment to increase spending on the country's infrastructure, in a move which is likely to kick start the investment cycle and put the economy back on track. Sentiments were also buttressed as FM promised lower-than-expected borrowing despite raising the fiscal deficit target and as Jaitley announced several measures to woo foreign investors, who have been the backbone of the current rally that has seen Indian stocks outperform most emerging markets. FM deferred the dreaded General Anti Avoidance Rule (GAAR) by two years and proposed to extend a concessionary rate of 5% for so-called withholding taxes on debt investments by foreign investors by two years, until July 1, 2017.

However, in the extremely volatile session of trade, benchmarks after succumbing several times to selling pressure, made a recovery and concluded the session in green with gains of around three tenths of a percent which lifted both Sensex and Nifty above psychologically crucial 29,450 and 8,950 levels respectively. Meanwhile, broader indices to settled higher with gains of around a percent.

On the global front, European shares clung to seven-year highs on Monday, lifted by merger activity in the telecoms sector, while Asian stocks edged up after China cut interest rates at the weekend. Mood in European region also was lifted after German manufacturing activity expanded further in February as new order rose, according to Markit's final purchasing manager's index (PMI) for the month.

Closer home, bourses’ gains to some extent were limited on account of somber macro-economic data. In not so encouraging development for the economy, HSBC Manufacturing Purchasing Managers’ Index (PMI) survey showed that India’s manufacturing sector expanded at its slowest pace in five months in February as slowdown in new orders dragged the overall output. Dropping to its lowest level since September 2014, headline HSBC India Purchasing Managers’ Index fell from 52.9 in the previous month to 51.2 in February. A figure above 50 indicates the sector is expanding, while a figure below that level means contraction. Nevertheless, February marked 16th straight month of factory activity expansion.

On the BSE sectoral front, while stocks from Capital Goods, Healthcare and Banking counters were the top performers of the session, much of the drubbing was witnessed by stocks from Fast Moving Consumer Goods and Realty counters were the notable losers of the session. In stock-specific activity, while Aviation stocks slid after hike in ATF price, PSU OMCs gained after announcing hike in fuel prices.  Meanwhile, Jet fuel price was hiked by a steep 8.2% on 1 March 2015 by the PSU OMCs. Additionally, cement shares were in demand on hopes of higher sales going ahead following the government intention to spend infrastructure spend. The overall market breadth on BSE was in the favour of advances which thumped declines in the ratio of 1531: 1333; while 114 shares remained unchanged.

The BSE Sensex concluded at 29459.14, up by 97.64 points or 0.33% after trading in a range of 29259.77 and 29576.32. There were 16 stocks advancing against 14 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 1.31%, while Small cap index up by 0.93%.

The gaining sectoral indices on the BSE were Capital Goods up by 3.58%, Healthcare up by 1.87%, Bankex up by 1.81%, Power up by 1.46% and Infrastructure up by 1.15% while, FMCG down by 1.89%, Consumer Durables down by 1.16%, Realty down by 0.30%, Auto down by 0.29%, TECK down by 0.23% were the losing indices on BSE. (Provisional)

The top gainers on the Sensex were Axis Bank up by 5.97%, Cipla up by 5.80%, Larsen & Toubro up by 4.48%, BHEL up by 4.14% and Hindustan Unilever up by 3.21%. On the flip side, ITC down by 4.91%, Bajaj Auto down by 4.02%, Bharti Airtel down by 2.42%, Hero MotoCorp down by 2.19% and Tata Motors down by 1.63% were the top losers. (Provisional)

Meanwhile, amid the claims of devising a transparent e-auction process through which all the coal blocks are being allocated, the government has told the nominated authority in charge of e-auctioning coal blocks to re-examine the bid process for the Gare Palma IV/1, Gare Palma IV 2&3 and Marki Mangli III blocks, following certain 'prima facie discrepancies' including questions over the bid prices.

The companies impacted are Balco, JSPL and BS Ispat, while Balco had bagged Gare Palma IV/1 block with a bid of Rs 1,585 a tonne Jindal Power, a subsidiary of Jindal Steel and Power, had retained its previously held blocks Gare Palma IV 2 & 3 at Rs 108 a tonne. BS Ispat has won the Marki Mangli III block at Rs 918 per tonne. These four mines are among the 19 operational blocks the government auctioned off in the first phase of e-auction.

The auctions for 19 blocks were completed by February 22, but the final agreements are yet to be signed and if some tampering is found in the bid process, the blocks may be re-auctioned.

Meanwhile, the coal ministry has received 107 applications from different public sector undertakings for allocation of 43 coal blocks to be given to state-run firms. Of the 43 mines, 42 are for power sector and one is for steel sector.

India VIX, a gauge for markets short term expectation of volatility declined 6.61% at 15.84 from its previous close of 16.96 on Saturday. (Provisional)

The CNX Nifty settled at 8956.75, up by 54.90 points or 0.62% after trading in a range of 8885.45 and 8972.35. There were 29 stocks advancing against 21 stocks declining on the index. (Provisional)

The top gainers on Nifty were Ultratech Cement up by 7.46% and Grasim Industries up by 6.23% and Axis Bank up by 5.71% and IDFC up by 5.14% and Cipla up by 5.12%. On the flip side, ITC down by 5.01%, Bajaj Auto down by 3.68%, Jindal Steel & Power down by 3.60%, Hero MotoCorp down by 2.24% and Bharti Airtel down by 2.02% were the top losers. (Provisional)

European Markets were trading mostly in green; Germany's DAX rose 0.35% and UK's FTSE 100 was up by 0.27%, while France's CAC was down by 0.21%.

The Asian markets ended mostly in green on Monday, as China’s weekend interest rate cut partially offset soft US data. Activity in China’s factory sector edged up to a seven-month high in February but export orders shrank and deflationary pressures persisted, a private business survey showed, adding to the view that yet more interest rate cuts will be needed. A survey showed the HSBC/Markit Purchasing Managers’ Index (PMI) climbed to 50.7 in February - the strongest level since July - from 49.7 in January, as overall new orders picked up. Chinese policymakers are embarking on their biggest easing campaign since the depths of the global crisis as the world’s second-largest economy is weighed down by a cooling property market, high debt levels and excess factory capacity. The People’s Bank of China cut interest rates, in the latest effort to support the economy as its momentum slows. The move was its third major policy easing since late November and came just days before the annual meeting of the country’s parliament. Thailand CPI fell to a seasonally adjusted annual rate of -0.52%, from -0.41% in the preceding month. Indonesian Inflation fell to a seasonally adjusted 6.29%, from 6.96% in the preceding month. South Korean Industrial Production rose to a seasonally adjusted annual rate of 1.8%, from 1.1% in the preceding month whose figure was revised up from 0.4%.