Benchmarks witness bloodbath; Sensex breaches 27,200 mark

Indian barometer gauges witnessed bloodbath with both the major indices losing around a percentage point and ending below their crucial 8,250 (Nifty) and 27,200 (Sensex) levels. Selling was both brutal and wide-based as none of sectoral indices on BSE were spared. Counters, which featured in the list of worst performers, include realty, healthcare, oil and gas and consumer durables. Sentiments remained down-beat since morning on continued worries over retrospective taxes and lower-than-expected January-March earnings so far. Further, investors are cautious ahead of the expiry of April derivatives contracts due on Thursday and the two-day meet of Federal Open Market Committee (FOMC) in which the Federal Reserve is likely to signal its stance on key policy rates.

Sentiments also remained dampened on report that foreign portfolio investors sold shares worth a net Rs 775.46 crore on Friday, 24 April 2015. Moreover, investors failed to draw any sense of relief with Finance Minister Arun Jaitley’s statement in order to contain the adverse fall out of MAT levy on foreign investors that the Indian government will set up a high- level committee to sort out the taxations issues of the past and make the system predictable.

Selling got intensified as European markets made an awful start with CAC, DAX and FTSE all were trading lower in early deals, with persistent concerns about Greece’s debt situation prompting some investors to take profits after recent strong gains. Asian markets ended mixed as investors remained cautious ahead of central bank meetings this week in the US and Japan and on deadlock in creditors’ talks with Greece.

Back home, depreciation in Indian rupee against dollar too dampened the sentiments. The rupee was trading at 63.63 at the time of equity markets closing versus its previous close of 63.56 on the back of dollar demand from importers and weakness in equities. Selling in banking counters too weighed down sentiments after ICICI Bank declared Q4 numbers. ICICI Bank fell 2% after bank’s net profit rose 10.18% to Rs 2922 crore on 12.23% rise in total income to Rs 16234.73 crore for the quarter under review on Y-o-Y basis. Investors continued to sell-off holdings in software and technology counters led by fall in Infosys on the back of disappointing earnings while guidance was also lower than industry forecasts.

The NSE’s 50-share broadly followed index Nifty tumbled by over ninety points to end below the psychological 8,250 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex declined by over two hundred and sixty points to finish below its psychological 27,200 mark. Broader markets too witnessed blood-bath and ended the session with a cut of around two and a half percentage points. The market breadth remained in favor of decliners, as there were 664 shares on the gaining side against 2,063 shares on the losing side while 87 shares remain unchanged.

Finally, the BSE Sensex plunged by 260.95 points or 0.95% to 27176.99, while the CNX Nifty dropped by 91.45 points or 1.10% to 8,213.80.

The BSE Sensex touched a high and a low of 27567.28 and 27141.55, respectively. The BSE Mid cap index was down by 2.10%, while Small cap index down by 2.85%.

The top gainers on the Sensex were Maruti Suzuki up by 3.02%, Sesa Sterlite up by 2.37%, Wipro up by 1.91%, Coal India up by 0.41% and Tata Motors up by 0.39%. On the flip side, Bharti Airtel down by 3.11%, SBI down by 3.08%, Dr. Reddys Lab down by 3.01%, BHEL down by 2.87% and HDFC down by 2.64% were the top losers.

The losing sectoral indices on the BSE were Realty down by 3.96%, Healthcare down by 3.21%, Oil & Gas down by 2.48%, Consumer Durables down by 2.17% and FMCG down by 1.73% while there were no gainers.

Meanwhile, amid stiff resistance by several opposition parties, the long-pending Bill on Goods and Services Tax (GST), which was moved in the Lok Sabha on Friday will be taken up for consideration  and passage on Monday. The Constitution (122nd Amendment) Bill, 2014, was moved on Friday by Finance Minister Arun Jaitley, who asserted this a 'win-win' measure for both the Centre and the states in an effort to allay the apprehensions of some state governments who worried about revenue loss if this piece of legislation was passed.

However, the fate of this bill remains to be hanging given that this Constitution amendment bill requires two-thirds support in both the Houses and with Congress looking keen to create hurdles given that BJP blocked the same bill when it was in power, Modi led government will need deft political management, especially in Opposition-dominated Rajya Sabha, to ensure the bill's passage.

Notably, Congress Party along with those of the Left, TMC and NCP staged a walk out after their plea for referring the Constitution Amendment Bill to the Standing Committee was not accepted. However, government friendly parties AIADMK and BJD also opposed its consideration but did not walk out.

The Opposition members blamed that the government was 'bull-dozing' and was quietly wanting to pass the bill, however the parties demanded more time to study the 'new' legislation.The crucial GST, which is expected to add 1-2% to the GDP by creating a national market for goods and removing distortions caused by multiple indirect taxes levied by the Centre, states and local bodies, was earlier supposed to be rolled out from April 1, 2010 but has been delayed due to resistance on the part of many states that feared a loss of revenue.

The CNX Nifty touched a high and low of 8,334.45 and 8,202.35 respectively.

The top gainers on Nifty were Maruti Suzuki India up by 3.08%, Sesa Sterlite up by 2.56%, Punjab National Bank up by 1.71%, Wipro up by 1.64% and Idea Cellular up by 1.42%. On the flip side, BPCL down by 6.98%, Cairn India down by 5.19%, Asian Paints down by 3.71%, Hindustan Unilever down by 3.28% and Bharti Airtel down by 3.26% were the top losers.

European Markets were trading in the red; Germany's DAX was down by 0.01%, France's CAC down by 0.76% and UK's FTSE 100 was down by 0.33%.

The Asian markets made a mixed closing on Monday, though there was big gains in the mainland Chinese market with Shanghai Composite rising over 3% to hit a new 3-years high after fresh weak industrial-profit data added to pressure on policymakers to unveil more stimulus to boost growth. Chinese industrial firms fell 0.4 percent in March from a year earlier to 508.61 billion yuan ($82 billion), compared with a 4.2 percent fall in the first two months of the year, falling for the sixth straight month. Seoul market turned lower as renewed worries about Greece’s ability to pay its creditors prompted investors to lock in some profits at higher levels after recent sharp gains. Meanwhile, the Japanese market too moved lower on stronger yen and as caution set in ahead of central bank meetings this week in Japan and the United States. The weak economic data from US underlined concerns that the recovery is losing momentum. In other markets, Hang Seng and Taiwan Weighted ended in green, while the Jakarta Composite suffered sharp cut of around 3.5%.