Post Session: Quick Review

Union Budget 2016-17 failed to cheer investors with frontline gauges breaching their crucial 23,100 (Sensex) and 7,000 (Nifty) levels. The markets, which traded lethargic in early deals, ran out breath and fell like a house of cards, as the Union Budget 2016-17 lacked any big-bang announcement, which the investor’s community was largely expecting from Finance Minister Arun Jaitley. By late noon deals, the benchmark index had erased most of its intra-day losses to regain lost ground as buying by domestic institutions and reports about an imminent rate cut by Reserve Bank of India (RBI) helped improve the sentiment battered by the proposal for higher dividend distribution tax on those earning more and a proposal to increase securities transaction tax in some categories.

But the recovery proved to be short-lived and markets once again lost ground to end the session with a cut of over half a percent. Market participants remained disappointed with the increase in Securities Transaction Tax on options from 0.017 per cent to 0.05 per cent and also the Dividend Distribution Tax where Jaitley has proposed an extra 10 per cent tax in the hands of the investor on dividend income over Rs. 10 lakh in a year. However, the partial easing of tax on withdrawal from the National Pension System should come as a relief to individuals and the market.

On the global front, European markets were trading in red terrain in early deals as a weekend meeting of the G20 group of leading economies failed to strike new, concrete measures to boost growth. Asian stocks ended mostly in red after a week-end meeting of the Group of 20 economic policymakers ended with no new coordinated action to spur global growth and as solid US data revived expectations of a US rate hike before year-end.

Back home, markets failed to draw any sense of relief with the report that foreign direct investment (FDI) into the country increased by 40 percent to $29.44 billion during April-December in the current fiscal. Power sector stocks edged lower despite the Prime Minister Narendra Modi has asked the Power Ministry to target electrification of around 200 villages every week by holding regular follow ups with the state implementing agencies. Aviation stocks too remained under pressure after the Finance Minister hiked excise duty on aviation turbine fuel.

On the flip side, shares related to realty counter remained on buyers’ radar after the finance minister Arun Jaitley in the Union Budget 2016-17 proposed many measures to promote housing and real estate sector. Banking stocks too ended in green after the finance minister Arun Jaitley's announcement of Rs 25000 crore for recapitalisation of banks in Union Budget 2016-17.

The NSE’s 50-share broadly followed index Nifty tumbled by over one forty points to end below the psychological 7,000 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex declined by over one hundred and fifty points to finish below its psychological 23,100 mark. Broader markets too struggled to get some traction and ended mixed on Monday. The market breadth remained in favor of decliners, as there were 1087 shares on the gaining side against 1,394 shares on the losing side while 158 shares remain unchanged. (Provisional)

The BSE Sensex ended at 23002.00, down by 152.30 points or 0.66% after trading in a range of 22494.61 and 23343.22. There were 11 stocks advancing against 19 stocks declining on the index. (Provisional)

The broader indices ended mixed; the BSE Mid cap index was up by 0.03%, while Small cap index down by 0.07%. (Provisional)

The gaining sectoral indices on the BSE were Bankex up by 1.07%, Finance up by 0.90%,Realty up by 0.27%, Metal up by 0.15% and FMCG up by 0.10%, while IT down by 2.11%, TECK down by 2.00%, Capital Goods down by 1.99%, Consumer Durables down by 1.75% and Oil & Gas down by 1.50% were the losing indices on BSE. (Provisional)

The top gainers on the Sensex were ICICI Bank up by 2.79%, Reliance Industries up by 1.69%, ITC up by 1.65%, Lupin up by 1.42% and SBI up by 1.38%. On the flip side, ONGC down by 9.72%, Maruti Suzuki down by 4.88%, BHEL down by 4.21%, Infosys down by 3.33% and Larsen & Toubro down by 2.83% were the top losers. (Provisional)

Meanwhile, Foreign Investment Promotion Board (FIPB) will be taking a call on 33 foreign investment proposals, in its 232nd meeting which will be held on March 07, under the chairmanship of Secretary (Economic Affairs) Shaktikanta Das. The proposals include those belonging to the insurance sector. FIPB recommends foreign investment proposals that are up to Rs 5,000 crore to government for approval.

FIPB would take up proposals of Apollo Hospitals Enterprise, Whirlpool Asia, Bupa Singapore Holdings, Sun Life Financial (India) Insurance Investment, Lupin and Yes Bank, as per the agenda circulated to secretaries of different ministries and departments. Besides the investment proposals of Nippon Life Insurance Company, Tata AIA Life Insurance Company and Aviva Life Insurance Co lndia are also on the agenda of the meeting.

Further, other investment proposals which are on the agenda include those of Standard Chartered (I) Modeling and Analytics Centre, Sun Pharma Advanced Research Co, Almondz Insurance Brokers, Tata Sikorsky Aerospace, International Asset Reconstruction Co, and HSBC Securities and Capital Markets (India).

In order to boost FDI in the country, the government has relaxed FDI norms in as many as 15 sectors, including defence, single brand retail, construction development, civil aviation and LLPs. Recently, the government has approved 10 FDI proposals amounting Rs 607 crore, including proposal of Alstom Manufacturing India worth Rs 400 crore on the recommendations of FIPB.

The CNX Nifty ended at 6987.05, down by 42.70 points or 0.61% after trading in a range of 6825.80 and 7094.60. There were 17 stocks advancing against 33 stocks declining on the index. (Provisional)

The top gainers on Nifty were ICICI Bank up by 2.84%, Kotak Mahindra Bank up by 2.38%, SBI up by 1.83%, Reliance Industries up by 1.72% and Indusind Bank up by 1.67%. On the flip side, ONGC down by 10.16%, Maruti Suzuki down by 5.07%, Cairn India down by 4.73%, BHEL down by 4.47% and Infosys down by 3.31% were the top losers. (Provisional)

European markets were trading in red; Germany’s DAX declined 154.49 points or 1.62% to 9,358.81, UK’s FTSE 100 decreased 55.7 points or 0.91% to 6,040.31 and France’s CAC was down by 48.87 points or 1.13% to 4,265.70.

Asian markets ended mostly lower on Monday, after a weekend meeting of G20 policymakers ended with no new coordinated action to spur global growth and as solid US data revived expectation of the Federal Reserve further raising rates before year-end. Chinese shares closed at one-month lows as some investors were disappointed by a lack of specific measures to boost growth during the Group of 20 meetings in Shanghai. Concerns over capital flows as China's central bank guided the yuan to its weakest level in three weeks, too weighed on Chinese shares. Japanese shares ended sharply lower as the dollar took a breather against the yen following Friday's steep climb on the back of upbeat US data. Economic reports painted a mixed picture, with Japan's industrial output rising for the first time in three months in January and housing starts figures coming in above forecasts, while retail sales fell slightly more than expected last month.