Benchmarks end lower for third straight day

Extending their losing streak to third straight day, Indian equity benchmarks ended the session near intraday low levels with key indices ending below their crucial 28,300 (Sensex) and 8,600 (Nifty) levels. Friday’s session turned out to be a choppy day of trade for the Indian equity markets as traders remained on sidelines focussing on domestic developments included the ongoing budget session in Parliament. Meanwhile, Finance Minister Arun Jaitley referring to doubts expressed by various sections over the GDP figure of 7.4 percent for 2014-15 as projected by the Central Statistical Organisation's (CSO), sought to dispel doubts, saying that the GDP calculations are made independently by the CSO, which is a credible organisation.

Additionally, the losses also came on the back of participants slashing their position into equities ahead of the volatile F&O expiry week. Investors also failed to draw any sense of relief from report that global rating agency Fitch said India’s gross domestic product (GDP) to grow at 8.0% in 2015-16 and 8.3% in the next fiscal, based on the new data series. The forecasts according to earlier series were 6.5% and 6.8%, respectively.

On the global front, European shares inched higher in early deals on Friday, helped by gains in the construction sector after Holcim and Lafarge agreed to new merger terms. Asian stocks ended mostly in the red on Friday as Federal Reserve-inspired gains petered out, while the dollar steadied after rebounding from the shock of a surprisingly dovish US central bank.

Back home, depreciation in Indian rupee too weighed down sentiments. Rupee was trading at 62.54 per dollar at the time of equity markets closing compared with its previous close of 62.52 on fresh demand for the American currency from importers. Banking shares continued to reel under pressure for the second straight day with the National Stock Exchange (NSE) Bank Nifty index fallen nearly three percentage points in two days.

Shares of most of the sugar companies edged lower after the sweetener prices fallen to five year low following ample stocks on persistent supplies from mills amidst weak demand. Meanwhile, minerals and metal shares ended mixed after the Rajya Sabha today passed the Mines and Minerals (Development and Regulation) Amendment Bill, 2015 to auction mines that supply minerals such as iron ore and bauxite. Additionally, shares of pharmaceutical companies have fallen by up to 17% on the bourses in late noon trade on profit bookings.

The NSE’s 50-share broadly followed index Nifty ended lower by over sixty points to end below its psychological 8,600 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex declined by over two hundred points to end below the psychological 28,300 mark. The broader markets witnessed blood-bath during the trade and ended the session with a cut of around one and a half percent. The market breadth remained in favour of decliners, as there were 752 shares on the gaining side against 2,117 shares on the losing side while 106 shares remain unchanged.

Finally, the BSE Sensex dropped by 208.59 points or 0.73% to 28261.08, while the CNX Nifty plunged by 63.75 points or 0.74% to 8,570.90.

The BSE Sensex touched a high and a low of 28484.36 and 28209.66, respectively. The BSE Mid cap index was down by 1.49%, while Small cap index was down by 2.14%.

The top gainers on the Sensex were Wipro up by 2.92%, Infosys up by 1.30%, Coal India up by 0.75%, TCS up by 0.59% and HDFC Bank up by 0.34%. On the flip side, NTPC down by 6.25%, BHEL down by 3.68%, ICICI Bank down by 3.36%, GAIL India down by 3.31% and Mahindra & Mahindra down by 2.70% were the top losers.

The gaining sectoral indices on the BSE were IT up by 0.86% and TECK up by 0.49% while, Realty down by 3.74%, Power down by 2.09%, FMCG down by 2.09%, Consumer Durables down by 1.93% and Healthcare down by 1.52% were the losing indices on BSE.

Meanwhile, the possibility of the current leg of the Parliament session being extended has diminished with the two sides in the Rajya Sabha reaching an understanding to fast-track the disposal of both contentious mines and minerals and the coal mines bills. Opposition on Thursday forced deferment of consideration of the contentious Mines and Minerals Bill in Rajya Sabha till Friday, arguing that mineral-bearing states had not been consulted.

It was after hour of wrangling, the government and the Opposition both resolved to dispose of the two bills. While, opposition felt that it needed time to study the select committee reports on these bills, the government offered a choice between considering (and voting on) the bills on Thursday-Friday and sitting for one week more. However, opposition contesting the second option decided to fast-track the disposal of the two bills.

If amended by the Rajya Sabha, the two bills will have to go back to the Lok Sabha. However, parliamentary Affairs Minister M Venkaiah Naidu has to complete the whole exercise before the Lok Sabha concludes its sitting. The parliament session, which began on Feb 23 and would continue uptill May 8 is scheduled to a month's recess after Friday's business. The government wants to rush the two bills because these are designed to replace ordinance.

Government appears to have achieved breakthrough on this on account of the support it received from regional parties like BJD, TMC and AIADMK which have come around to support the twin bills because of the lure of additional resources they can generate for their states and after government accepted some of the changes they proposed.

The CNX Nifty touched a high and low of 8,627.90 and 8,553.00 respectively.

The top gainers on Nifty were Wipro up by 2.83%, Power Grid Corporation of India up by 2.16%, Infosys up by 1.48%, Ambuja Cements up by 1.21% and Kotak Mahindra Bank up by 1.19%. On the flip side, NTPC down by 5.98%, Jindal Steel & Power down by 5.00%, Bharat Heavy Electricals down by 3.76%, Bharat Petroleum Corporation down by 3.43% and ICICI Bank down by 3.29% were the top losers.

European Markets were trading in the green; Germany's DAX was up by 0.59%, France's CAC was up by 0.11% and UK's FTSE 100 was up by 0.03%.

The Asian markets closed mixed on Friday, due to the mixed cues overnight from Wall Street following the Fed-inspired rally seen in the previous session. The Bank of Japan in minutes released from its February 17-18 board meeting reported that consumer prices may flatten and real wages may also drop as a sharp drop in global oil prices takes its toll. The remarks suggest continued concern over hitting a target of sustained 2% inflation this fiscal year even as economic growth looks more promising, adding that the pace of buying government bonds to support easing needs to be assessed. Bank of Japan Governor Haruhiko Kuroda stated that the longer-term domestic price trend is still upward because the base effect of last year’s plunge in crude oil prices on consumer inflation will disappear eventually. Kuroda added that market participants are unlikely to seek any monetary policy implications in what is projected to a temporary downward effect of lower energy prices on the year-on-year change in core CPI, which is set to slip further to zero and into negative territory. Kuroda repeated that the BoJ can anchor 2% inflation around fiscal 2015 ending March 31, 2016. Japan’s All Industries Activity Index rose to a seasonally adjusted 1.9%, from -0.1% in the preceding month whose figure was revised up from -0.3%.