Benchmarks end lower for fifth straight session

Extending their losing streak for fifth straight session, Indian equity benchmarks ended the volatile day of trade slightly in the red as investors remained on sideline ahead of expiry of March derivative contracts on Thursday. Selling in last leg of trade mainly dragged the markets lower. However sentiments remained up-beat for most part of the day’s trade on the back of the Asian Development Bank’s (ADB’s) latest Outlook report, saying that developing Asia, which groups 45 countries in Asia-Pacific, is set to grow 6.3 per cent this year and the next, the same pace as in 2014. India and most Southeast Asian economies will lead the way, offsetting slowing growth in China. Meanwhile, the Union government will borrow Rs 3.6 lakh crore from markets in the first half of the next financial year, which is over 50 percent of the annual target of Rs 6 lakh crore.

On the global front, European markets have made a positive start ahead of PMI data for euro zone countries including Germany and France. Asian markets ended mostly in the green with Shanghai Composite rising to hit a new 3-year high despite weak factory activity. The flash HSBC/Markit Purchasing Managers’ Index (PMI) dipped to 49.2 in March, below the 50-point level that separates growth in activity from contraction on a monthly basis.

Back home, continuing its rising streak for the seventh straight session, the rupee rose by 9 paise to 62.18 against the dollar at the Interbank Foreign Exchange on sustained selling of dollars by exporters. Some support also came in with report that foreign portfolio investors (FPIs) bought shares worth Rs 417.41 crore and domestic institutional investors (DIIs) bought shares worth Rs 403.91 crore yesterday, as per provisional data of the stock exchanges. Meanwhile, exports oriented stocks remained in limelight, as the Commerce and Industry Minister Nirmala Sitharaman has said that the government will soon unveil the much-delayed Foreign Trade Policy (FTP) which is expected to roll out steps to boost exports.

Select stocks from telecom sector edged higher after Ministry of Communications & Information Technology said that about 88% of the spectrum has been provisionally allocated to bidders at a value of approximately Rs 1.05 lakh crore. Additionally, public sector oil marketing companies (OMCs) edged higher on buzz a foreign brokerage upgraded BPCL and Indian Oil Corporation citing inexpensive valuations and downstream oil companies remain in a bright spot. On the flip side, metal & mining stocks edged lower after data released today, March 24, 2015 showed Chinese manufacturing activity dropped to an 11-month low in March 2015.

The NSE’s 50-share broadly followed index Nifty declined by around ten points to end below the psychological 8,550 support level, while Bombay Stock Exchange’s Sensitive Index – Sensex slipped by over thirty points to end below its psychological 28,200 mark. Broader markets too struggled to get any traction and ended the session with a cut of around half a percent. The market breadth remained in favour of decliners, as there were 1,079 shares on the gaining side against 1,725 shares on the losing side while 121 shares remain unchanged.

Finally, the BSE Sensex declined by 30.30 points or 0.11% to 28161.72, while the CNX Nifty lost 7.95 points or 0.09% to 8,542.95.

The BSE Sensex touched a high and a low of 28455.32 and 28130.09, respectively. The BSE Mid cap index was down by 0.44%, while Small cap index was down by 0.64%.

The top gainers on the Sensex were Bharti Airtel up by 2.86%, GAIL India up by 1.82%, Dr. Reddys Lab up by 1.73%, NTPC up by 1.63% and Sesa Sterlite up by 1.57%. On the flip side, Tata Motors down by 3.27%, Hindalco down by 1.88%, Hindustan Unilever down by 1.59%, SBI down by 1.57% and Tata Steel down by 1.16% were the top losers.

The gaining sectoral indices on the BSE were Healthcare up by 1.84 %, Consumer Durables up by 0.69%, INFRA up by 0.69%, Oil & Gas up by 0.68% and PSU up by 0.05% while, Auto down by 1.17%, Bankex down by 0.61%, IT down by 0.50%, Realty down by 0.40% and FMCG down by 0.30% were the losing indices on BSE.

Meanwhile, with the Foreign Trade Policy (FTP) 2014-19 all set to expire March 31, 2014, the government is may yet again miss the deadline. The policy, which was last set to expire in March last year was extended by a year as the government did not announce a new FTP. The new policy had been expected to be put in place quickly after the Narendra Modi government came to power in May 2014. But the finance ministry's reluctance to give sizeable funds for export sops forced the commerce ministry to delay it to the next fiscal year.

However, Commerce and Industry Minister Nirmala Sitharaman expressed hopes of coming up with the policy soon. She also dismissed claims of exports falling substantially on account of delay in putting up new FTP. Justifying this she said that exports suffered even when the FTP was explicit and was there in place between 2009 and 2014. Further, the Minister in an attempt to reason out the delay in FTP said that the new five-year FTP with a 'Make in India' focus needed comprehensive deliberations on various sectors and exporting destinations.

She underlined that the new policy had to be out-of-the-box and was expected to support India's exports, which could be done by assessing various sectors and their capability and new and traditional markets of the world.

Further, Commerce Minister pointed that the FTP would not lay emphasis on subsidies and incentives to exporters and would rather make it easier for them to do business. She highlighted that her ministry has already reduced the number of mandatory documents required for import and export of goods to three in each case from close to a dozen at present.

The CNX Nifty touched a high and low of 8,627.75 and 8,535.85 respectively.The top gainers on Nifty were Lupin up by 5.33%, BPCL up by 3.33%, Bharti Airtel up by 3.11%, GAIL (India) up by 1.99% and SSLT up by 1.96%. On the flip side, Tata Motors down by 3.56%, Hindalco Industries down by 1.99%, Hindustan Unilever down by 1.48%, UltraTech Cement down by 1.34% and Tata Steel down by 1.33% were the top losers.

European Markets were trading in the green; Germany's DAX was up by 0.48%, France's CAC was up by 0.67% and UK's FTSE 100 was up by 0.34%.

The Asian markets closed mostly in green on Tuesday, with Shanghai Composite rising to hit a new 3-year high. Activity in China’s factory sector dipped to 11-month low in March as new orders shrank, signaling persistent weakness in the world’s second-largest economy that will likely fuel calls for more policy easing to support growth. The poor reading added to signs that the economy has lost momentum despite two interest rate cuts since November a reduction in the amount of money banks must keep in reserve and repeated attempts by the central bank to reduce financing costs. The flash HSBC/Markit Purchasing Managers’ Index (PMI) dipped to 49.2 in March, below the 50-point level that separates growth in activity from contraction on a monthly basis. The People’s Bank of China (PBOC) lowered its guidance rate for the benchmark seven-day bond repurchase agreement, lowering the rate to 3.55% down from 3.65% the previous week. Bank of Japan Governor Haruhiko Kuroda stated that tapering asset purchases is one option in ending the bank’s massive stimulus programme. But he stressed anew that it was too early to debate the timing, method and means to end quantitative easing (QE).