Post Session: Quick Review

The Indian market got a halt to their eight days gaining streak on Wednesday, there was sharp reversal in last leg of trade that dragged the markets considerably lower after a report broke out that Greek PM told measures proposed by him was not accepted by creditors. Although there was some choppiness during the day too, induced by the June F&O series expiry scheduled on Thursday but the benchmarks reclaiming their crucial psychological levels of 27900 (Sensex) and 8400 Nifty managed to remain in green for most part of the day. The rally in the markets for past couple of sessions had been broad-based as the mid-cap and small-cap indices too rose considerably but in the last moment sell-off, the broader markets too gave up.

On the global front, after a positive close at Wall Street, the Asian markets followed the trend and ended mostly in green with the Japanese market Nikkei surging to the highest level since 1996 on signs of a pickup in economic growth, earnings optimism and hopes that Greece will avoid a debt default. The European markets after a cautious start turned lower, though some of the indices in the region were still trading in green as Euro-area finance ministers will meet for the third time in a week in a bid to hammer out a deal.

Back home, the penultimate day of June series F&O expiry turned up to be a mood dampener for the markets, with benchmarks finding stiff resistance at 27800 (Sensex) and 8400 (Nifty). The last moment of across the board selloff was both brutal and sharp that dragged the benchmarks lower by around half a percent for the day. There was some concern related to monsoon too, with the weather office tempering optimism spurred by above-average rain this month, predicting that overall precipitation will fall short in the June-September period as the El Nino phenomenon brings in dry weather. Almost all the sectoral indices were dragged in red in last hour flurry of selling with metal, infra, oil & gas,consumer durables and auto suffering the most. In scrip specific action, Sun TV shares fell as much as 9 per cent on Wednesday, extending its losses to the third day on some report that the Prime Minister's Office has found merit in the Home Ministry's decision to deny the broadcaster security clearance for its 33 channels. On the same time, Hindustan Unilever surged by around 2 percent on report that the company may consider acquiring Kerala-based ayurvedic hair and skin care brand Indulekha for Rs 500 crore.

The BSE Sensex ended at 27671.83, down by 132.54 points or 0.48% after trading in a range of 27661.94 and 27948.24. There were just 6 stocks on gainers side against 24 stocks on the decliners side on the index.(Provisional)

The broader indices too surrendered by last; the BSE Mid cap index was down by 0.45%, while Small cap index lost 0.64%.(Provisional)

The lone gaining sectoral index on the BSE was FMCG up by 0.01%, while Metal down by 1.79%, INFRA down by 1.53%, Consumer Durables down by 1.15%, PSU down by 1.14%, Oil & Gas down by 1.12% were the top losing indices on BSE.(Provisional)

The top gainers on the Sensex were BHEL up by 3.77%, Hindustan Unilever up by 1.80%, Lupin up by 1.77%, Sun Pharma Inds up by 1.68% and Wipro up by 1.46%. On the flip side, Hindalco down by 3.66%, Tata Steel down by 3.35%, Mahindra & Mahindra down by 2.47%, SBI down by 2.20% and NTPC down by 1.83% were the top losers.(Provisional)

Meanwhile, Chief Economic Advisor Arvind Subramanian suggesting systemic changes to check generation of black money has said that the current system of chasing illicit funds is actually compounding the problem because the taxation rules are being seen as arbitrary. He has asked the Centre to focus on the origins of black money rather than chasing it in all corners of the globe if it wants to avoid giving out a 'wrong perception about India'.

He also said that the perception of the tax system being somewhat arbitrary can play a role in this regard. Subramanian said that “For me black money is much more important in terms of what it signals...Arbitrariness, tax rules, discretion and corruption, all these things. We need to be very serious about addressing them. What we are doing currently that gives rise to black money.”

Subramanian said that one of the problems in addressing the issue of black money was that India's tax system was perceived as being arbitrary and added that the danger is that in trying to address that, you could actually compound some of the perceptions about India. He said that it was more important to understand why we create black money in the first place and address those things. Black money, he said, needed to be thought of as a stock problem rather than a flow problem.

The CNX Nifty ended at 8360.85, down by 20.70 points or 0.25% after trading in a range of 8338.90 and 8421.35. 13 stocks advanced against 37 declining stocks on the index.(Provisional)

The top gainers on Nifty were BHEL up by 4.22%, Zee Entertainment up by 2.79%, Hindustan Unilever up by 2.38%, Lupin up by 1.92% and Sun Pharma Industries up by 1.56%. On the flip side, PNB down by 3.60%, Hindalco down by 3.58%, Bank Of Baroda down by 2.93%, Tata Steel down by 2.72% and Mahindra & Mahindra down by 2.53% were the top losers.

Asian markets closed in green on Wednesday, as investors waited for some positive resolution on Greece’s debt crisis. The bailout deal is however in doubt as Greece Prime Minister Tsipras informed that measures were not accepted by creditors. Indonesia’s central bank, hoping to spur economic growth reduced the minimum down-payments consumers have to pay for cars and motorcycles while increasing the percentage of a home price that a buyer can borrow. A new regulation loosening rules for automotive and mortgage lending took effect on June 18. The benefits of the Bank of Japan’s aggressive easing are being outweighed by side effects, one board member stated in the minutes of the May meeting released. Board member Takahide Kiuchi in particular has dissented at recent board meetings and called for a cut in outright annual government bond purchases to 45 trillion yen from 80 trillion yen now. At the May meeting, the board decided by an 8 to 1 vote to leave the bank’s policy target unchanged while revising up its economic assessment slightly and warning about the downside risk from Europe’s low growth and inflation. In the minutes, there was also concern raised about a slowdown in China and whether inflation expectations overall would rise. At the same time Japan released May service producer prices, which rose 0.6% year-on-year, down slightly from 0.7% gain in April. Japan’s corporate services price index fell to a seasonally adjusted annual rate of 0.6%, from 0.7% in the preceding month. Taiwanese Industrial Production fell to a seasonally adjusted annual rate of -3.18%, from 1.06% in the preceding month.