Markets extend the decline for second consecutive session; Nifty ends below 8350

Tuesday was not a different day from the previous one when the markets lost further ground with benchmarks just slipping off their crucial psychological levels of 8350 (Nifty) and 27550 (Sensex) respectively. Although selling was not intense but across the board profit taking was seen throughout the day amid the caution of the May F&O series expiry on Thursday. Traders remained cautious with Reserve Bank Governor Raghuram Rajan’s statement that growth is slow in picking up even as macro-economic parameters have improved, while stressing the role of state governments in improving fiscal performance. He also said that there was a need to make State Level Coordination Committees (SLCCs) more active and effective. Trade was weighed down by a survey of NCAER which said that business sentiment fell sharply in the March quarter due to concerns over investment climate amid “patchy” and “uneven growth”.

The day of trade was also impacted by the weakness in rupee which extending losses for the second straight day, against the dollar came near the 64 mark as the American currency firmed up overseas. Traders were also eyeing the developments in Greece after its government said it intends to make good on its debt obligations but needs aid urgently to be able to do so.

On the global front, while the US markets remained closed, the Asian markets ended mostly in green led by the Hang Seng market that surged by around a percent to a seven-year high. The European markets after falling in last session were fluctuating in early trades as investors weighed the prospects for higher US rates this year.

Back home, the markets made a flat start and after slight upmove showed signs of consolidation, however selling in bluechips kept pressurizing the markets and benchmarks gradually started slipping deeper in red. It was in the final moments that some recovery was seen that helped the markets to pare some losses on Chief Economic Adviser Arvind Subramanian’s statement that India's adequate food stocks would help contain inflation, even if summer monsoon rains turn out to be weak. Sectorally, barring banking and to some extent power, none of the gauges showed any resistance till last and ended in red. The broader indices too after fluctuating through the day ended modestly in red. There were lots of scrip specific movements that kept the markets buzzing. Tata Motors lost around 2 percent, ahead of its January-March quarter earnings due later in the day, amid expectations that it could disappoint due to sluggish sales at unit Jaguar Land Rover in China. Nestle India cracked another 2 percent following reports that Uttar Pradesh FDA may file case against the company in one week's time. The department had found high level of lead in Nestle Maggi, a brand which accounts for 80 per cent of noodle market in India.

Finally, the BSE Sensex dropped by 112.47 points or 0.41% to 27531.41, while the CNX Nifty declined by 30.90 points or 0.37% to 8,339.35.

The BSE Sensex touched a high and a low of 27675.94 and 27473.54, respectively. The BSE Mid cap index was down by 0.01%, while Small cap index down by 0.16%.

The top gainers on the Sensex were BHEL up by 2.88%, Coal India up by 1.41%, Hero MotoCorp up by 1.24%, Maruti Suzuki up by 0.96% and Bajaj Auto up by 0.96%. On the flip side, Vedanta down by 2.33%, ONGC down by 2.05%, Tata Motors down by 1.60%, NTPC down by 1.34% and Dr. Reddys Lab down by 1.07% were the top losers.

The gaining sectoral indices on the BSE were Bankex up by 0.08%, Power up by 0.02% and INFRA up by 0.01%, while Oil & Gas down by 1.03%, Realty down by 0.86%, FMCG down by 0.54%, Healthcare down by 0.40 % and IT down by 0.35% were the losing indices on BSE.

Meanwhile, the government has cleared 21 foreign direct investment (FDI) proposals worth Rs 280.70 crore. The inter-governmental panel, chaired by Economic Affairs Secretary cleared the proposal of pharma firm La Renon Healthcare to invest Rs 100 crore in a brownfield project, while Blue Dart Express's proposal to acquire shares in Blue Dart Aviation and hike shareholding to 74 percent from 49 percent, entailing investment between Rs 52.8 crore to Rs 69 crore, too has been approved.

The other proposals which got approval includes, Quickjet Cargo Airlines’ proposal to increase foreign shareholding in the company to 74 percent from 62.34 percent, which entails FDI worth Rs 14.40 crore. Forever Living Imports (India) Rs 18.30-crore proposal to undertake single brand retailing of 'Forever' brand products in India has also been approved by the board.

The FIPB has, however, deferred 12 proposals including that of Mumbai-based Kotak Bank for the hike in aggregate foreign investment limit in the bank to 55 percent. The proposal of NBFC company IIFL Holdings for increasing foreign equity from 54.7 percent to 100 percent by way of issuing shares to FIIs too has been deferred.

Further, the Board has also rejected seven proposals, including that of Sharekhan and Human Value Developers to transfer CCDs and CCPs of their companies held by IDFC to Baring Private Equity, Mauritius.

FDI proposals under approval route are cleared by the Foreign Investment Promotion Board (FIPB). However, those proposals involving investment of more than Rs 3,000 crore are given final clearance by the Cabinet Committee on Economic Affairs (CCEA).

The CNX Nifty touched a high and low of 8,378.90 and 8,320.05 respectively.

The top gainers on Nifty were BHEL up by 5.06%, Coal India up by 1.50%, Hero MotoCorp up by 1.33%, Yes Bank up by 1.31% and Bajaj Auto up by 1.23%. On the flip side, Ambuja Cements down by 2.28%, Vedanta down by 2.06%, Tech Mahindra down by 1.99%, ONGC down by 1.99% and NTPC down by 1.30% were the top losers.

European Markets were trading in the red; Germany's DAX was down by 0.62%, France's CAC down by 0.11% and UK's FTSE was down by 0.47%.