Post Session: Quick Review

Tuesday turned out to be a daunting session for the Indian equity indices which got pounded by over one percentage point, amid weak global cues. After a negative opening, the domestic bourses never looked in recovery mood and ended the trade at intraday lows, breaching their crucial support levels of 24,600 (Sensex) and 7,500 (Nifty). Selling was both brutal and wide-based as most of sectoral indices on BSE ended in red terrain. Counters which featured in the list of worst performers included healthcare, fast moving consumer goods and information technology.

Sentiment remained down-beat despite retail inflation falling to a three- month low of 5.18 per cent in February after rising for five months in a row as food prices including vegetables, pulses and fruits became less costly. Some concern came with hailstorms in key farming belts of the country that may lead to the fourth successive crop failure and RBI too may wait to see the actual impact on food and overall retail inflation. Sentiments weighed down with one of the leading global brokerage firm revising its growth forecast for India for 2016 to 7.5 per cent from 7.9 per cent previously and noted that the country’s economy is expected to see tepid recovery largely owing to external factors. According to the global financial services firm, though the domestic macro environment has been improving steadily in the last two years, the pace of recovery has been slower than anticipated, held back by external factors

Selling got intensified after European counters have made a feeble start on Tuesday, mirroring weaker commodity prices. Asian equity indices ended mostly in red after the Bank of Japan held policy steady and offered a bleaker view of the country's economy.

Closer home, depreciation in Indian rupee too dampened the sentiment. The rupee was at 67.33 per dollar at the time of equity markets closing as compared to 67.11 per dollar level on Monday. Socks related to gold and jewellary space remained under pressure, as the Finance Minister Arun Jaitley has refused to roll back a 1 per cent excise duty on non-silver ornaments proposed in the Budget.

On the other hand, Bank shares firmed up on hopes of a rate cut by the central bank after consumer price inflation eased further. Buying witnessed in oil & gas sector counter, as the global rating agency Standard & Poor's has said that the new price formula and calibrated marketing freedom for gas produced from fields in difficult terrain could help attract investments in India's oil and gas sector. Sugar stocks also remained on buyers’ radar on the back of expectations of lower domestic sugar output in SY16 owing to drought conditions in major producing states, together with mandatory exports notified by the Government of India that have led to an uptrend in domestic sugar prices.

The NSE’s 50-share broadly followed index Nifty tumbled by around eighty points to end below the psychological 7,500 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex declined by over two hundred and fifty points to finish below its psychological 24,600 mark. Broader markets too witnessed selling pressure and ended the session with a cut of over half a percent. The market breadth remained in favor of decliners, as there were 1,011 shares on the gaining side against 1,630 shares on the losing side while 160 shares remain unchanged. (Provisional)

The BSE Sensex ended at 24551.17, down by 253.11 points or 1.02% after trading in a range of 24517.28 and 24840.77. There were 7 stocks advancing against 22 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 0.79%, while Small cap index down by 0.62%. (Provisional)

The top gaining sectoral indices on the BSE were Bankex up by 0.36%, PSU up by 0.33%, Oil & Gas up by 0.29%, Metal up by 0.19% and Energy up by 0.18%, while Healthcare down by 3.01%, FMCG down by 1.54%, TECK down by 0.93%, IT down by 0.85% and Consumer Discretionary Goods & Services down by 0.85% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were SBI up by 1.81%, Bharti Airtel up by 1.06%, Tata Steel up by 1.01%, Axis Bank up by 0.76% and BHEL up by 0.43%. On the flip side, Lupin down by 7.68%, HDFC down by 3.46%, Dr. Reddys Lab down by 3.13%, Sun Pharma down by 2.49% and Cipla down by 2.24% were the top losers. (Provisional)

Meanwhile, amid rising concerns that the government was not fully passing on the ensuing benefits of the drastic fall in crude prices to the consumers, Finance Minister Arun Jaitley has said that the savings are being used for developing infrastructure to push growth and create jobs, besides enabling oil marketing companies meet their losses that once stood at Rs. 30,000 crore.

The minister while replying to a query in parliament for not reducing prices of petrol and diesel, in proportion to the fall in crude prices in the international market, elaborated that the benefit of reduction in crude oil has been divided into three portions. One goes to public sector oil marketing companies. These oil companies make future purchases of crude oil and they had incurred losses. He added that these oil companies were sitting on Rs 30,000 crore loss and that couldn't have been met by increasing income tax or any other tax. So, naturally oil companies -- which decide the price in the market -- would wipe off their losses first.

Jaitley further said that many states have also hiked VAT (Value Added Tax) levied on fuel and such proceeds are used for public purpose only. Whatever has come to the central government is a small portion of excise or cess, and the government has spent a portion of that in infrastructure because spending on infrastructure helps in creating more jobs and pushes growth.

The CNX Nifty ended at 7460.60, down by 78.15 points or 1.04% after trading in a range of 7452.80 and 7545.20. There were 16 stocks advancing against 34 stocks declining on the index. (Provisional)

The top gainers on Nifty were SBI up by 1.95%, Bank of Baroda up by 1.60%, Tata Steel up by 1.26%, PNB up by 1.22% and Yes Bank up by 1.12%. On the flip side, Lupin down by 7.83%, HDFC down by 4.09%, Zee Entertainment down by 3.55%, Dr. Reddys Lab down by 3.10% and ITC down by 2.63% were the top losers. (Provisional)

European markets were trading in red; UK’s FTSE 100 decreased 40.54 points or 0.66% to 6,134.03, Germany’s DAX shed 37.67 points or 0.38% to 9,952.59 and France’s CAC was down by 32.18 points or 0.71% to 4,474.41.

Asian equity markets ended mostly in red on Tuesday as oil prices fell again on oversupply concerns and the Bank of Japan preferred to stand pat on rates after its surprise January decision to adopt negative interest rates. Lackluster cues from Wall Street, a weaker yuan and profit taking after recent sharp gains also kept investors on edge ahead of a two-day Federal Reserve monetary policy meeting that gets underway tonight. Japanese stocks ended lower after the central bank decided to leave its main policies unchanged, resulting in a stronger yen that pushed exporter shares lower. However, China stocks recouped early losses to end modestly higher on Tuesday, led by gains in finance, consumer and real estate shares.