Benchmarks witness bloodbath; Sensex slips below 24200 mark

Indian equity bourses commenced the fresh week on a depressing note as the benchmark indices extended previous week’s sell-off and sank by over a percentage point to the lowest levels since June 2014. Growing concerns about the growth of the world economy coupled with the relentless fall in the international crude oil prices has mounted pressure across the board on domestic markets. Sentiments remained down-beat with Niti Aayog member Ramesh Chand warning that the country's farm sector crisis is expected to deepen further in 2016-17 if the current trend of falling global commodities prices is not reversed.  He also pitched for more private sector involvement, reforms in land lease policy and easy market access, while emphasizing the need to train farmers with additional skills to get jobs outside farming to tide over the agricultural crisis. Besides, the data released by the government showed that India’s merchandise exports shrunk for the 13th straight month in December also weighed on sentiments. Reflecting the sluggish global demand, India's merchandise exports have contracted by 14.75 percent to $22.3 billion. Trade deficit during the month under review widened to the most since August to $11.6 billion as against $9.17 billion in December 2014.

On the global front, Asian market ended mostly in red on Monday, tracking a sell-off on Wall Street over the weekend as discouraging US with decline in US retail sales and drop in industrial output in December. Furthermore, Oil prices touched their lowest since 2003, as the market braced for a jump in Iranian exports after the lifting of sanctions against the country during the weekend. However, Chinese shares ended higher, aided by property gains after figures from the National Bureau of Statistics showed China's home prices continued to rise in December 2015, adding to signs of improvement in the housing market. European markets opened in green, however, soon slipped in the negative terrain on global cues.

Back home, the benchmarks got off to a somber opening, extending the downtrend for the third straight session as pessimistic sentiments prevailed across Asian markets. Thereafter, the key indices failed to show any kind of fervor due to lack of encouraging leads. The selling pressure accentuated in the late afternoon trades as investors took to across the board risk aversion. Eventually the NSE’s 50-share broadly followed index Nifty, took a cut of over a percent to settle tad above the crucial 7,350 support level while Bombay Stock Exchange’s Sensitive Index, Sensex slipped by over two hundred and fifty points and closed below the psychological 24,200 mark. Moreover, the broader markets too failed to show any kind of fervor and plunged by over two and half percent, underperforming their larger peers by quite a margin. On the sectoral front, the high beta sectors like Oil & Gas, Realty and Capital Goods witnessed brutal assaults as they got clobbered by 3.49%, 2.98% and 2.30% respectively. Moreover, counters like PSU and Auto too suffered severe pounding. There appeared absolutely no gainer on the BSE sectoral front. The market breadth remained awful as there were 332 shares on the gaining side against 2393 shares on the losing side while 142 shares remained unchanged.

Finally, the BSE Sensex declined by 266.67 points or 1.09% to 24188.37, while the CNX Nifty lost 86.80  points or 1.17% to 7,351.00.

The BSE Sensex traded in a range of 24524.85 and 24141.99. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices made a negative closing; the BSE Mid cap index ended down by 2.72%, while Small cap index ended down by 4.05%.

The top losing sectoral indices on the BSE were Oil & Gas down by 3.43%, Realty down by 3.16%, PSU down by 2.17%, Capital Goods down by 2.07% and Power down by 1.77%, while there were no gainers on the sectoral space.

The top gainers on the Sensex were BHEL up by 4.29%, Tata Steel up by 2.76%, TCS up by 0.84%, Hindustan Unilever up by 0.80% and Hero MotoCorp up by 0.73%. On the flip side, Reliance Industries down by 5.14%, Bajaj Auto down by 3.67%, Asian Paints down by 3.29%, Cipla down by 2.72% and Coal India down by 2.12% were the top losers.

Meanwhile, reflecting the sluggish global demand, India's merchandise exports contracted for the thirteenth consecutive month in December, registering 14.75% decline over last year. While exports came in at $22.2 billion, Imports too fell from a year earlier to $33.96 billion and the trade deficit widened to $11.66 billion compared with a provisional $9.8 billion a month ago. The trade deficit for April-December, 2015-16 was estimated at $99207.75 million which was lower than the deficit of $111685.04 million during April-December, 2014-15. Orders from the United States and Europe shrank and exporters grappled with a competitively weaker Chinese yuan.

According to the data released by the Commerce Ministry, Indian exports during December, 2015 were valued at $22297.48 million in Dollar terms, 14.75 per cent lower than the level of $ 26154.46 million during December, 2014. In Rupee terms the exports stood at Rs. 148491.18 crore for the month against Rs. 164127.08 crore in the same month last year, showing a decline of 9.53 per cent. Cumulative value of exports for the period April- December 2015-16 was $196603.94 million as against $239928.91million, registering a negative growth of 18.06 per cent in Dollar terms. It stood at Rs 1273322.99 crore in Rupee term down by 12.67 per cent of Rs 1458094.40 crore in the same period last year.

Meanwhile, Imports during December, 2015 were valued at $33961.48 million in dollar terms, 3.88 per cent lower over the level of imports valued at $35333.27 million in same period last year. In rupee terms imports were valued at Rs 226168.20 crore, which was 2.00 per cent higher than Rs 221726.88 crore during December 2014. Cumulative value of imports for the period April-December 2015-16 in Dollar terms was $295811.69 million, as against $351613.95million, registering a negative growth of 15.87 per cent in Dollar terms. In rupee terms the imports for the period April-December 2015-16 stood at Rs 1915849.40 crore, down by 10.34 per cent compared to Rs 2136855.40 crore in the same period last year.

Oil imports which accounts for 31 percent of the total imports, dropped by 33.19 per cent during December, 2015 at $6656.74 million than oil imports valued at $9963.44 million in the corresponding period last year. Oil imports during April-December, 2015-16 were valued at $68068.20 million which was 41.60 per cent lower than the oil imports of $116559.48 million in the corresponding period last year. Non-oil imports during December, 2015 were estimated at $27304.74 million which was 7.63 per cent higher than non-oil imports of $25369.83 million in December, 2014. Non-oil imports during April-December, 2015-16 were valued at $227743.49 million which was 3.11 per cent lower than the level of such imports valued at $235054.47 million in April-December, 2014-15.

The deteriorating global economic growth outlook and rising volatility in currency markets have dampened Indian exports, although the blow has been softened by a collapse in the country's oil import bill. The last time Indian exports registered a positive growth was in November 2014, when shipments had expanded at a rate of 7.27 percent.

The CNX Nifty traded in a range of 7,463.65 and 7,336.40. There were 12 stocks advancing against 38 stocks declining on the index.

The top gainers on Nifty were BHEL up by 3.74%, Tata Steel up by 3.35%, Ultratech Cement up by 1.21%, HCL Tech up by 1.19% and Wipro up by 1.01%. On the flip side, Cairn India down by 7.57%, Vedanta down by 6.52%, Reliance Industries down by 4.93%, BPCL down by 4.07% and Asian Paints down by 3.67% were the top losers.

European markets were trading in red, Germany’s DAX was down by 40.79 points or 0.43% to 9,504.48, France’s CAC declined by 29.4 points or 0.7% to 4,180.76 and UK’s FTSE 100 decreased 9.62 points or 0.17% to 5,794.48.

Asian equity markets ended mostly in red on Monday as massive falls in oil prices and weak US economic data on retail sales, industrial production and regional manufacturing activity stoked worries about the health of the world economy. Japanese stocks closed lower amid continued unease over China's economic outlook and the slide in crude oil prices to lows not seen since 2003. However, Chinese shares ended higher, aided by property gains after figures from the National Bureau of Statistics showed China's home prices continued to rise in December 2015, adding to signs of improvement in the housing market. The People’s Bank of China stepped up its fight against currency speculators by unveiling plans to lift the reserve requirement ratio on offshore yuan interbank deposits placed by yuan clearing banks with their head offices in China. The new rules, which will be effective from January 25, are aimed at stopping the shorting of the offshore yuan (traded in Hong Kong), which has been falling as traders bet on more weakness in the onshore yuan.