Post Session: Quick Review

Monday’s session turned out to be a choppy day of trade for Indian equity markets with frontline gauges ended the session with marginal losses as investors opted to remain on sidelines ahead of the Reserve Bank of India’s (RBI) monetary policy review tomorrow. Sentiments also remained dampened after Standard & Poor’s Ratings Services has said that India will face challenges in sticking to the fiscal consolidation roadmap as the expected revenues may not be fully realised and subsidy cuts may be delayed. Traders failed to get any sense of relief with, NITI Aayog Vice-Chairman Arvind Panagariya’s statement that  India is expected to get on to a double-digit growth in the next 2-3 years if reform process continues.

However, losses remained capped as some support came after Indian manufacturing sector growth rose to a four-month high in January driven by rising inflows of new business orders from domestic as well as export clients. The Nikkei India Manufacturing PMI, a composite monthly indicator of manufacturing performance, stood at 51.1 in January, up from 49.1 in December. Some support also came with Finance Minister Arun Jaitley’s statement that the 8% GDP growth can be achieved next fiscal on account of improved rural demand and better monsoon.

On the global front, European counters were trading in red after shares of Nokia and Alcatel -- which Nokia is in the process of acquiring -- slumped around 10 per cent after Nokia settled a patent dispute with South Korea's Samsung. However, Asian markets ended mostly in green on the back of the Bank of Japan’s surprise stimulus move continued to be felt across financial markets. However, Chinese shares stumbled lower on Monday after an official measure of activity in the giant factory sector fell to its lowest since mid-2012, offering no respite from the economic drift that has dogged markets for months.

Closer home, appreciation in Indian rupee aided some sentiments. The rupee were trading higher by 14 paise against the US dollar to Rs 67.64 at the time of equity markets closing on sustained bouts of dollar selling by banks and exporters. Meanwhile, foreign institutional investors turned buyers in equities worth Rs 240 crore, as per provisional stock exchange data.

Auto space witnessed selling after companies reported mixed auto sales numbers for January 2016.  Maruti Suzuki India registered a fall of 2.6% in its total car sales (Domestic + Export) at 113,606 units, as against 116,606 units in January 2015, however, Eicher Motors’ motorcycle division reported a 65% jump in total sales in January 2016 at 47,710 units, as against 28927 units in the same month last year and Ashok Leyland reported an increase of 30% in sales in January 2016 to 13,886 units as against 10,643 units sold in the same period of last year. Select stocks from steel sector edged higher with Union Minister Narendra Singh Tomar stating that additional steps will be taken to protect domestic steel industry. Aviation stocks flied high after aviation turbine fuel price was slashed by nearly 12% with effect from February 1, 2016.

The NSE’s 50-share broadly followed index Nifty slipped by around ten points to hold the psychological 7,550 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex declined by around fifty points to finish below its psychological 24,850 mark. Broader markets, however, traded with traction and ended the session with a gain of around half a percent.

The market breadth remained in favor of advances, as there were 1,425 shares on the gaining side against 1,265 shares on the losing side while 142 shares remain unchanged. (Provisional)

The BSE Sensex ended at 24824.83, down by 45.86 points or 0.18% after trading in a range of 24788.58 and 25002.32. There were 13 stocks advancing against 17 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.57%, while Small cap index up by 0.29%. (Provisional)

The top gaining sectoral indices on the BSE were Telecom up by 1.94%, FMCG up by 0.98%, Capital Goods up by 0.98%, Industrials up by 0.96% and Metal up by 0.78%, while Bankex down by 1.40%, Power down by 0.55%, PSU down by 0.38%, Auto down by 0.36% and Oil & Gas down by 0.26% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Adani Ports &Special up by 3.67%, Coal India up by 2.67%, Cipla up by 2.07%, Bharti Airtel up by 2.00% and Larsen & Toubro up by 1.81%. On the flip side, ICICI Bank down by 5.63%, SBI down by 3.92%, Maruti Suzuki down by 3.68%, Axis Bank down by 2.17% and Hindustan Unilever down by 1.84% were the top losers. (Provisional)

Meanwhile, Government has raised excise duty on petrol and diesel, the third increase in duties in the month of January, to mop up over Rs 3,200 crore in additional revenue, netting in all Rs 17,000 crore in three months. The duty on petrol has been raised by Re 1 per litre, while that on diesel by Rs 1.50 per litre. The hike did not result in any increase in retail selling price of the two fuels as it was adjusted against the reduction in rates that may have been possible because of the slide in international oil prices. This is the third hike in excise duty in January as the government made use of the slump in oil prices to shore up resources at a time when its disinvestment kitty is likely to fall way short of target.

As per the notification of the Central Board of Excise and Customs (CBEC), the total levy on unbranded petrol will be Rs 21.48 per litre as against Rs 20.73 currently, after including additional and special excise duty. On unbranded or normal diesel, total excise duty after including special excise duty will be Rs 17.16 per litre as compared to Rs 15.66 at present.  Basic excise duty on unbranded or normal petrol has been increased from Rs 8.48 per litre to Rs 9.48 and the same on unbranded diesel from Rs 9.83 to Rs 11.33. The basic excise duty on branded petrol has been raised from Rs 9.66 per litre to Rs 10.66 and the same on branded diesel from Rs 12.19 to Rs 13.69 per litre.

The three hikes in excise duty in January take to five the number of times tax rates on the two fuel have been raised this fiscal. If the government would not have raised these duties, consumer price of petrol and diesel should have been lower by 11.77 a litre and Rs 13.30 per litre, respectively. In excise collections from the petroleum sector in 2014-15, the government had collected Rs 99,184 crore, which stood at Rs 33,042 crore in the first quarter of the current fiscal.

Prior to this, the government had on January 16 hiked the excise duty on petrol by Rs 0.75 per litre and Rs 2 on diesel to mop up over Rs 3,700 crore in additional revenue. Before that the government on January 2 had hiked the excise duty on petrol by Rs 0.37 per litre and Rs 2 on diesel to mop up a little less than Rs 4,400 crore.

The CNX Nifty ended at 7555.95, down by 7.60 points or 0.10% after trading in a range of 7541.25 and 7600.45. There were 24 stocks advancing against 26 stocks declining on the index. (Provisional)

The top gainers on Nifty were Adani Ports & SEZ up by 4.17%, Yes Bank up by 3.43%, Coal India up by 2.69%, ACC up by 2.56% and Cipla up by 2.45%. On the flip side, ICICI Bank down by 5.63%, SBI down by 3.97%, Maruti Suzuki down by 3.60%, Bank of Baroda down by 2.55% and Axis Bank down by 2.23% were the top losers. (Provisional)

European markets were trading lower; Germany’s DAX decreased 52.82 points or 0.54% to 9,745.29, UK’s FTSE 100 dropped 36.59 points or 0.6% to 6,047.20 and France’s CAC was down by 32.06 points or 0.73% to 4,384.96.

Asian equity markets ended mix on Monday as oil prices declined after last week's sharp rally and a slew of data painted a mixed picture of the Chinese economy. Japan shares gained after the Bank of Japan's shock move last week to adopt negative interest rates. Seoul shares closed notably higher on stimulus hopes after official data showed South Korea's exports shrank to nearly a seven-year low in January. Exports dropped 18.5 percent from a year earlier in their biggest drop since the depths of the global financial crisis in 2009. However, China shares fell after China's official manufacturing purchasing manager's index (PMI) came in at 49.4 in January, slightly down from December's 49.7 reading and missing estimates for a score of 49.6 while growth in the services sector activity slowed from the previous month. However, the Caixin China manufacturing PMI, a private gauge of nationwide factory activity, edged up to 48.4 from 48.2 in December, offering some respite to investors worried over slowing growth in the world's second-largest economy. The Malaysian market was closed in observance of Federal Territory Day.