Markets crash like house of card in last leg of trade

Tuesday turned out to be a daunting session for the Indian equity indices which got pounded by around a percentage point after the Parliament’s first day of monsoon session failed to impress traders. Final hour of trade proved to be the curse for the markets and bourses settled below their crucial 28,200 (Sensex) and 8,550 (Nifty) levels. After trading in tight band for most part of the day’s trade, domestic gauges crashed like house of card in the last leg of trade. Investors remained concerned as monsoon session of the Parliament that begun today is expected to be volatile as the opposition likely to target the government over multiple scandals that erupted in the recent past. Disruptions spoiled the proceedings and Rajya Sabha was adjourned thrice on the first day and Union finance minister Arun Jaitley said the opposition does not want to let the monsoon session of Parliament run.

Investors also shrugged off better than expected Infosys’ Q1 numbers. The company has reported 4.99% rise in its net profit at Rs 3030 crore for the quarter ended June 30, 2015 as compared to Rs 2886 crore for the same quarter in the previous year. It has also upped dollar revenue growth for 2015-16. After several quarters the company raised its US dollar revenue guidance from 6.2-8.2% in dollar terms to 7.2-9.2%.

On the global front, European counters were trading higher in early deals on Tuesday, with encouraging earnings updates from several companies helping the market to hover just below a six-week high. Asian markets ended mostly in green, taking heart from fresh highs on Wall Street, while gold prices took back some lost ground after plunging more than 4 per cent to five-year lows in the previous session.

Back home, selling in healthcare counter weighed down sentiments with Sun Pharma contributing the most to the losses after the drug maker said its profit might be adversely impacted in financial year 2015-16. FMCG space too witnessed selling pressure owing to weak Q1 results of HUL. The FMCG major has reported marginal rise of 0.22% in its net profit at Rs 1059.14 crore for the quarter ended June 30, 2015 as compared to Rs 1056.85 crore for the same quarter in the previous year. The company’s total income has increased by 3.73% to Rs 8213.74 crore for the quarter under review from Rs 7918.45 crore for the corresponding quarter of the previous year.

NSE’s 50-share broadly followed index, Nifty declined by over seventy points to end below the psychological 8,550 support level, while Bombay Stock Exchange’s Sensitive Index - Sensex tumbled by around two hundred and forty 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 one and a half percent. The market breadth remained in favour of decliners, as there were 946 shares on the gaining side against 1,883 shares on the losing side while 101 shares remain unchanged.

Finally, the BSE Sensex plunged by 237.98 points or 0.84% to 28182.14, while the CNX Nifty declined by 74.00 points or 0.86% to 8529.45.

The BSE Sensex touched a high and a low 28518.06 and 28138.30, respectively. The BSE Mid cap index was up by 1.42%, while Small cap index up by 1.59%.

The top gaining sectoral indices on the BSE were IT up by 4.57% and TECK up by 3.82%, while Healthcare down by 5.93%, Realty down by 2.16%, Infrastructure down by 1.98%, Oil & Gas down by 1.74% and FMCG down by 1.67% were the losing indices on BSE.

The top gainers on the Sensex were Infosys up by 11.05%, Bharti Airtel up by 3.68%, Wipro up by 1.69%, Hero MotoCorp up by 1.10% and Bajaj Auto up by 0.99%. On the flip side, Sun Pharma down by 14.95%, Vedanta down by 4.74%, Lupin down by 4.68%, ONGC down by 3.56% and Tata Steel down by 3.29% were the top losers. 

Meanwhile, United Nations Under Secretary General and CEO for 'SE4ALL' initiative, Kandeh K Yumkella has said that India can lead the world in the area of sustainable energy from renewable sources, as its clean energy target is way ahead of the UN global goal. He added that “We believe that India can lead the world. India's targets here and some of the progress it is making here is way ahead of UN global targets. But of course, there is a lot more work to do.”Yumkella, who is also special representative of the UN Secretary General, said, 'We used India over the past decade as a laboratory to bring convergence between energy access and climate change recognising still 2.7 billion people around the world rely on charcoal, cow dung and firewood to meet their primary energy needs.

The UN's 'SEE4ALL or Sustainable Energy for All' envisages making sustainable energy a reality for all by 2030. It aims that by 2030, entire world and every citizen of the world should have affordable energy access. India targets 175 GW of renewable energy capacity by 2022, which includes 100 GW of solar, 60 GW of wind power, 10 GW of biomass-fired power and 5 GW of small hydro power.

Earlier, a World Bank Group had reported that about 1.1 billion people worldwide is still living without access to electricity, with most of them concentrated in Africa and Asia. It added that another 2.9 billion rely on wood or other biomass for cooking and heating, resulting in indoor and outdoor air pollution attributable for 4.3 million deaths each year.

The CNX Nifty touched a high and low 8,646.75 and 8,517.90 respectively.

The top gainers on Nifty were Infosys up by 11.50%, Bharti Airtel up by 3.62%, HCL up by 2.47%, Zee Entertainment up by 2.21% and Tech Wipro up by 1.66%. On the flip side, Sun Pharma down by 15.08%, Lupin down by 5.05%, Vedanta down by 5.03%, Asian Paints down by 4.38% and Ultratech Cement down by 4.14% were the top losers.

European Markets were trading in the green; UK's FTSE was up by 0.07%, Germany’s DAX was up by 0.06% and France’s CAC was up by 0.13%.

Asian markets closed mostly in green on Tuesday, while Indonesia stock exchange was closed on account of ‘National Leave’ holiday. The Bank of Japan board was largely in agreement that prices will rise in the longer term, according to minutes of the June monetary policy meeting released, though one member stated that it would show up moderately in consumer inflation. However, other members notified that the impact of the quantitative easing to buy 80 trillion yen of mostly government bonds annually has had a big impact on the economy and higher prices are spreading and are also driven by higher wages. Board member Takahide Kiuchi has been the lone dissenter in recent reviews by the nine-member board, calling for the easing program to be scaled back to 45 trillion yen. Foreign investment into China rose 8% in the first half of this year as mergers and acquisitions by overseas companies more than quadrupled in value. Foreign direct investment (FDI), which excludes financial sectors, totaled $68.41 billion during the January-June period.  Thailand Governor Prasarn Triratvorakul stated that the Bank of Thailand has no target for the Thai baht but is pleased to see that it has weakened since April and is moving more in line with regional currencies. Thailand’s interest rates are near a record low after two surprise cuts this year. But lower rates have done little for the Thai economy as consumers, struggling to pay off record household debt, keep their money in their pockets.