Post Session: Quick Review

Indian equity markets depicted the choppiness of F&O expiry session on Thursday, extended their losing streak for third straight day as Rail Budged failed to match traders’ expectations. Markets traded choppy, swinging between green and red for most part of the day as investors remained on sidelines on February F&O series. Sharp wave of selling was witnessed in last hour of trade which dragged markets not only to intraday lows but at fresh 52 week closing lows, with frontline gauges breaching their crucial 23,000 (Sensex) and 7,000 (Sensex) levels.

Market participants were not too much enthused by a 21% hike in capital outlay announced in the Rail Budget 2016. Railway Minister Suresh Prabhu today proposed increasing the capital outlay for the Railways, the world’s fourth-largest rail network, by 21 per cent to Rs. 1.21 lakh crore. Traders also remained cautious with a private survey stating that optimism about the overall state of the economy came down in 2015, with households listing unemployment, corruption and rising inflation as major areas of concern. Traders failed to get any sense of relief with Cabinet approving withdrawal of surcharge, service charge and convenience fee on card and digital payments, with an aim to discourage cash transactions.

On the global front, European markets were trading in green in early deals as solid corporate results from the likes of French insurer AXA and British bank Lloyds lifted stock markets. Asian markets exhibited mixed trend on Thursday as investors remained cautious in the face of a fragile recovery in volatile crude oil - a source of much of the recent anxiety about the health of the global economy.

Closer home, selling was both brutal and wide-based as none of sectoral indices, barring metal, telecom and healthcare, on BSE were spared. Counters, which featured in the list of worst performers, include utilities, power and realty. Sentiments remained dampened on reports that foreign portfolio investors (FPIs) sold shares worth net Rs 730.99 crore yesterday, provisional data from the stock exchanges showed. Depreciation in Indian rupee too dampened sentiments. The rupee depreciated by 18 paise to trade at 68.74 against the US dollar at the time of equity markets closing as compared to 68.56 in previous session.

Selling in banking counter mainly played spoil sports for the markets after Moody's Investors Service said that the credit profiles of Indian public sector banks will worsen, if the government does not revise upwards its capital infusion plan for the banks in the upcoming budget to be presented on 29 February 2016. Railways related stocks edged lower as street was not impressed with the Railway budget 2016-17.

The NSE’s 50-share broadly followed index Nifty tumbled by around fifty points to end below the psychological 7,000 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex declined by over one hundred and ten points to finish below its psychological 23,000 mark. Broader markets too witnessed selling pressure and ended the session with a cut of around a percentage point. The market breadth remained in favor of decliners, as there were 1,285 shares on the gaining side against 1,599 shares on the losing side while 104 shares remain unchanged. (Provisional)

The BSE Sensex ended at 22976.00, down by 112.93 points or 0.49% after trading in a range of 22948.10 and 23142.96. There were 12 stocks advancing against 18 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 1.14%, while Small cap index was down by 0.91%. (Provisional)

The few gaining sectoral indices on the BSE were Metal up by 0.41%, Telecom up by 0.18% and Healthcare up by 0.10%, while Utilities down by 2.46%, Power down by 2.19%, Realty down by 1.95%, Capital Goods down by 1.91% and Bankex down by 1.67% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were ONGC up by 3.19%, Sun Pharma up by 2.69%, HDFC up by 1.96%, Coal India up by 1.88% and BHEL up by 1.07%. On the flip side, SBI down by 3.10%, ICICI Bank down by 2.81%, GAIL India down by 2.78%, Larsen & Toubro down by 2.48% and Tata Motors down by 2.41% were the top losers. (Provisional)

Meanwhile, in order to keep manufacturing sector competitive and boost the economic growth, Finance Minister Arun Jaitley ahead of the Union Budget 2016-17 has said that India needs to keep tax rates reasonable to become an attractive manufacturing hub and has to occasionally vary those rates. His comments come at a time when the manufacturing sector is showing incipient signs of a turnaround.

Jaitley at the Investiture Ceremony 2016 and Annual Central Excise Custom Day Function said that “Manufacturing itself is not only extremely important activity, but it is one activity with a spiral effect on the economy which also creates the largest volumes of job.”

He said that as the economies grow, not only the width of revenue grows but the expectation of people for greater level of developments, evolution of society as welfare state also grows. Manufacturing in any growing economy has a very vital role.

Further, the Minister is also looking at reducing the corporate tax rate to 25 per cent from the current 30 per cent over the next four years while winding up exemptions to India Inc.

The CNX Nifty ended at 6970.60, down by 48.10 points or 0.69% after trading in a range of 6961.40 and 7034.20. There were 13 stocks advancing against 37 stocks declining on the index. (Provisional)

The top gainers on Nifty were ONGC up by 3.27%, Sun Pharma up by 2.43%, HDFC up by 2.01%, Idea Cellular up by 1.48% and Coal India up by 1.41%. On the flip side, Power Grid down by 5.69%, Yes Bank down by 2.92%, SBI down by 2.88%, GAIL India down by 2.77% and ACC down by 2.70% were the top losers. (Provisional)

European markets were trading in green; France’s CAC surged 68.22 points or 1.64% to 4,223.56, Germany’s DAX increased 84.51 points or 0.92% to 9,252.31 and UK’s FTSE 100 was up by 112.32 points or 1.91% to 5,979.50.

Asian equity markets made a mixed closing on Thursday, as oil prices ended a brief overnight rally and Chinese shares slumped on fears of tighter liquidity and the cooling economy ahead of the G20 meeting in Shanghai on Friday and Saturday. Japanese shares ended higher, helped by an overnight bounce in oil prices and a weaker yen. Chinese shares ended lower, its worst loss in a month, despite China's central bank intensifying its liquidity operations and the chairman of Industrial and Commercial Bank of China saying there was no basis for continued depreciation of the yuan.