Post session - Quick review

Indian equity remained beleaguered by the berserk bears for fresh week as the benchmark indices witnessing a nasty laceration of over a percentage and half points concluded the first day of the holiday shortened week on an extremely apathetic note. Investors continued to book profit, in light of gloomy global set up. This accentuated selling pressure, ahead of outcome of Uttar Pradesh assembly elections, dragged the 30 share barometer index of Bombay Stock Exchange (BSE) -Sensex sub 17300 level. Similarly, prop came to the 50 share barometer index-Nifty-on NSE only at 5250 psychological level. However, broader indices acted no different and losses incurred by Midcap and Small cap indices were not similar to the magnitude of the frontline indices

On the global front, post the negative end of the Wall Street on Monday, Asian shares played the foul for the market. Asian pacific shares mostly crept lower on Monday, as investors turned cautious about riding further on liquidity-driven optimism without seeing more evidence of firmer global growth, while the concerns about the impact of a slowing Chinese economy also fed into the selloff. China said it will target the slowest economic growth since 2004.

Meanwhile, negative opening of the European markets too added to the investor’s angst. European shares, tracing the trajectory of the regional counterparts, dipped in early deals as tough talk by President Barack Obama over Iran's nuclear program and uncertainty over Greece's ability to clear the next hurdle in its debt reduction plan unnerved investors.  In a speech on Sunday, President Barack Obama said he would not hesitate to attack Iran to keep it from getting a nuclear bomb, hoping to dissuade Israel from launching a unilateral strike that could ignite a Middle East war.

Back on the home turf, although the bears were active across all the space, but the massacre was led by rate sensitives like Realty, Metal and Banking. Investor’s preferred locking in gains in these rates sensitive gauges ahead of the RBI’s monetary policy review, as they sensed RBI’s discomfort in slashing rates due to high oil prices that has major impact on inflation.  However, only the defensive Fast Moving Consumer Goods space managed to showcase resilience, with the index capturing gains of over 0.25%. Meanwhile, Anil Dhirubhai Ambani group companies' shares were the most active as well as biggest gainers among large caps. Shares of India's most valuable company Reliance Industries and country's second largest software services exporter Infosys declined nearly 2%. Metal stocks like Tata Steel, Hindalco and JSPL crashed 3-4.5% while Sterlite Industries slipped 1.5%.The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 980:1846 while 101 scrips remained unchanged. (Provisional)

The BSE Sensex lost 275.85 points or 1.56% and settled at 17,361.14. The index touched a high and a low of 17,598.42 and 17,312.30 respectively. 6 stocks advanced against 24 declining ones on the index (Provisional)

The BSE Mid-cap index lost 1.43% while Small-cap index was down by 0.92%. (Provisional)

On the BSE Sectoral front, FMCG up 0.27% was the sole gainer while Realty down 3.31%, Metal down 3.09%, Bankex down 2.72%, Capital Goods down 2.50% and Consumer Durables down 2.10% were the top losers.

The top gainers on the Sensex were Tata Motors up 2.61%, Wipro up 1.36%, ITC up 0.95%, ONGC up 0.94% and Cipla up 0.08%.

On the flip side, DLF down 5.51%, Hindalco Industries down 5.41%, GAIL India down 5.01%, Jindal Steel down 4.04% and BHEL down 3.99% were the top losers in the index. (Provisional)

Meanwhile, HSBC India Composite Index - which covers both the manufacturing and service sectors - fell from January’s nine-month high of 59.6 to 57.8 due to a fall in both the manufacturing as well as the services sector. On a more positive note, the expansion of overall new work intakes accelerated slightly to reach an eleven-month high marking a rise in business activity for the Indian private sector.

The seasonally adjusted HSBC Services Business Activity Index fell to 56.5 in February from 58.0 in January (the 50.0 no-change threshold separates growth from contraction).Even though it has fallen month-on-month, the sector has been growing continuously for the past 4 months. Service companies are also optimistic of work increasing over the next year and confidence levels are at an eight month high, as per the latest survey.

New business received by Indian service providers in Feb 2012 has increased markedly although the rate of growth has remained unchanged from the previous survey period. The rise in business has been attributed to the acquisition of new clients. Higher new work intakes, supported by marketing initiatives and the good quality of services provided, alongside ongoing improvements in market conditions are expected to boost activity in the coming year.

Manufacturing production growth has also come down though it is still marked. Manufacturers reported a marginal strengthening in new order growth. February data has however signaled that employment in the manufacturing sector has fallen slightly in February. Increase in input prices have eased slightly and have risen at the weakest rate in four months. However, the rate of cost inflation has remained marked and above the long-run trend. Manufacturers have also reported a marginal strengthening in new order growth.

Service providers have also registered slower increases in input prices. Overall charge inflation has also eased, with a faster rise in manufacturers’ output prices offset by a slower increase in charges in the service sector.

Leif Eskesen, Chief Economist for India & ASEAN at HSBC has cautioned that the Reserve Bank India will have to approach the easing cycle cautiously as inflation is likely to hover above the comfort zone. Prices of oil are likely to impact the timing as well as speed of rate cuts by the apex bank.

India VIX, a gauge for market’s short term expectation of volatility gain 2.55% at 28.92 from its previous close of 28.20 on Saturday. (Provisional)

The S&P CNX Nifty lost 79.05 points or 1.47% to settle at 5,280.35. The index touched high and low of 5,344.50 and 5,265.70 respectively. 12 stocks advanced against 38 declining ones on the index. (Provisional)

The top gainers on the Nifty were Reliance Infrastructure up 5.02%, Reliance Power up 4.93%, Tata Motors up 2.43%, ITC up 1.37% and Wipro up 1.33%.

On the other hand, JP associates down 5.71%, Hindalco Industries down 5.55%, DLF down 5.00%, GAIL India down 4.98% and SAIL down 4.93% were the top losers. (Provisional)

The European markets were trading in red, with France's CAC 40 down 0.81%, Germany's DAX down 1.19% and Britain’s FTSE 100 down 0.51%.

All the Asian equity indices barring KLSE Composite ended the day’s trade in the negative terrain on Monday, with resource and technology shares losing ground after China issued a lower economic growth forecast for this year, while energy plays succumbed to selling pressure after a sharp pullback in crude-oil prices Friday. Meanwhile, China shares ended down 0.64 percent on Monday after Premier Wen Jiabo cut the country’s GDP target for 2012, the lowest annual growth target in eight years. Chinese Premier Wen Jiabao said that China aims to deliver economic growth of 7.5 percent in 2012, after eight straight years of keeping the symbolic target at 8.0 percent.  In addition, Japan's Nikkei share average eased further from the closely watched 9,800 mark on Monday as market players said technical indicators pointed to a correction.