Post Session: Quick Review

Indian equity benchmarks ended the choppy day of trade slightly in the red on Tuesday as investors remained on sidelines ahead of third quarter earnings results starting next week with Infosys slated to announce its results on January 14, 2016. Immense volatility characterized trading whereby benchmark equity indices kept altering between green and red terrain throughout the session. However, broader indices outperformed benchmarks and garnered gain of over half a percent.

Sentiments also remained dampened with retail inflation for farm labourers and rural workers in November rising to 4.92 percent and 5.02 percent, respectively, due to increase in prices of food items. Meanwhile, Finance minister Arun Jaitley held pre-budget talks with farm sector and trade unions and said that there is a need for more investment in the farm sector as representatives from the key sector sought a string of measures to revive agriculture. He said that reviving the farm sector is a key priority for the government against the backdrop of sluggish growth and two consecutive seasons of patchy monsoon rains.

On the global front, European shares were trading mostly in red in early deals on Tuesday. Asian markets retreated in choppy trade to end mostly lower on Tuesday, led by Chinese stocks, whose early rebound fizzled out as investors remained unconvinced by Beijing’s moves to restore market confidence following a disastrous start to the new year.

Back home, foreign portfolio investors (FPIs) sold shares worth a net Rs 667.15 crore on 4 January 2016, as per provisional data released by the stock exchanges. Banks which are a proxy to the economy remained one of the top losers amid weak December manufacturing PMI. Stocks related to auto space struggled for second straight session post the December sales numbers. Meanwhile, in a setback to the automobile manufacturers, the Supreme Court of India upheld the ban on diesel vehicles in Delhi. The automobile manufacturers had moved the Supreme Court seeking modification of the court’s December order banning registration of diesel vehicles in the capital.

However, shares of the companies engaged in hotel business edged higher after Goldman Sachs has bought minority stake in Indian hotel investment and development firm SAMHI Hotels. Stocks related to power counter surged as the power ministry Piyush Goyal has said that fifteen states have joined the debt recast scheme for power distribution companies covering 90% of the losses accumulated with the utilities. Oil and gas stocks ended higher as the oil and gas industry body PetroFed, whose members include state-owned ONGC and private major Reliance Industries, has asked the government to allow natural gas pricing freedom to existing fields like KG-D6.

The NSE’s 50-share broadly followed index Nifty declined by just six points and ended below its psychological 7,800 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex declined by over forty points to end below its crucial 25,600 mark. Broader markets, however, outperformed benchmarks and ended the session with a gain of over half a percent.

The market breadth remained in favor of advances, as there were 2,058 shares on the gaining side against 859 shares on the losing side while 90 shares remain unchanged. (Provisional)

The BSE Sensex ended at 25580.34, down by 43.01 points or 0.17% after trading in a range of 25513.75 and 25766.76. There were 12 stocks advancing against 18 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.56%, while Small cap index up by 0.79%. (Provisional)

The gaining sectoral indices on the BSE were Metal up by 2.20%, Oil & Gas up by 1.93%, Basic Materials up by 1.63%, Realty up by 1.39% and Energy up by 1.07%, while Telecom down by 0.55%, IT down by 0.42%, TECK down by 0.41%, Bankex down by 0.32% and Auto down by 0.31%, were the losing indices on BSE. (Provisional)

The top gainers on the Sensex were Tata Steel up by 6.65%, GAIL India up by 2.75%, Asian Paints up by 2.20%, ONGC up by 1.47% and Reliance Industries up by 0.91%. On the flip side, Coal India down by 1.63%, SBI down by 1.22%, Hero MotoCorp down by 1.11%, Hindustan Unilever down by 1.09% and TCS down by 1.07% were the top losers. (Provisional)

Meanwhile, the commerce Ministry wants to create a fund aimed at boosting India's shrinking exports, proposing a financing mechanism that would discourage exports of raw material and help local value addition. On January 6 the Ministry of Commerce & Industry is likely to pitch the idea of the export development fund in pre-Budget consultations with the finance ministry.

The Commerce Ministry will suggest that the government provide 50% of the funds, while the remainder can come from taxation of exports of raw material such as iron ore. This fund will solve the twin purpose of financing exports and help in their marketing as there is a need for aggressive marketing for the exports at this point of time, particularly of small and medium enterprises.

Earlier, in order to boost shipments, the government had increased support for products made by SMEs such as industrial machinery, machine tools, bicycle parts and hand tools used in agriculture, among others, and raised allocations under the Merchandise Exports from India Scheme to Rs 21,000 crore from Rs 18,000 crore.

Contracting for the twelve month in a row, India’s exports plunged 24 percent in November to $20 million. The significant fall in exports is attributed to weak global demand, amid a tepid global economic recovery. April-November exports fell 18.5% from a year ago. Only seven of top 30 export goods, including carpets, jute products and tea, registered an increase in November, compared with nine in October. The constant decline in exports has raised doubts about the country achieving last year's export number of $310.5 billion.

The CNX Nifty ended at 7784.65, down by 6.65 points or 0.09% after trading in a range of 7763.25 and 7831.20. There were 24 stocks advancing against 26 stocks declining on the index. (Provisional)

The top gainers on Nifty were Tata Steel up by 6.77%, Vedanta up by 3.88%, GAIL India up by 3.46%, Hindalco up by 2.29% and Asian Paints up by 2.25%. On the flip side, Bank of Baroda down by 2.05%, PNB down by 1.95%, SBI down by 1.34%, Coal India down by 1.33% and Hindustan Unilever down by 1.29% were the top losers. (Provisional)

European markets were trading mostly in red; Germany’s DAX decreased 38.06 points or 0.37% to 10,245.38 and France’s CAC was down by 13.37 points or 0.3% to 4,509.08, while UK’s FTSE 100 was up by 14.02 points or 0.23% to 6,107.45.

Asian equity markets ended mostly in red on Tuesday as shares in Shanghai extended Monday's plunge and a diplomatic row between Saudi Arabia and Iran deepened with a number of Saudi Arabia's allies curbing their diplomatic links with Iran in protest at the execution of Sheikh Nimr al-Nimr. However, the People's Bank of China (PBOC) injected 100 billion yuan ($15.3 billion) into domestic markets and the yuan firmed against the dollar on suspected intervention by the central bank, helping limit overall losses to some extent. China's Shanghai Composite index ended a rollercoaster session lower despite state-controlled funds stepping in to help prop up the market and the securities regulator signaling a ban on share sales will remain beyond this week's expiration date.