Benchmarks witness bloodbath in final hours; Nifty breaches 7,550 mark

Caution ahead of the quarterly results season, along with relentless selling by foreign funds, dragged the Indian equity markets lower and benchmarks deposed around a percentage point on Thursday. Sentiments were dampened since beginning of trade as traders remained on sidelines ahead of January-March earnings reports amid worries companies continued to suffer due to lacklustre economic growth and weak global demand. A sluggish quarter could hit sentiment further after the Reserve Bank of India failed to impress markets on Tuesday by cutting interest rates by 25 basis points, as some had hoped the central bank would act more boldly. Investors failed to get any sense of relief  with industry body CII terming the GDP calculation methodology an ‘imprecise science’ and pegging the country's economic growth at around 8 per cent for the current fiscal, higher than the RBI's projection of 7.6 per cent. Markets participants also shrugged off ratings agency Moody's statement that India's rising foreign direct investment provides stable financing of its current account deficit and is a credit positive, implying that it would count positively towards a ratings upgrade at the time of the review.

On the global front, Asian markets ended mostly in green on Thursday after Federal Reserve meeting minutes reaffirmed that US policy makers aren’t in a rush to raise interest rates and as the recovery in crude oil prices solidified. Crude prices extended gains in Asia trade following a sizeable drop in US stockpiles, the first decline in seven weeks, indicating stronger demand in the world's top oil consumer. Meanwhile, European shares were slightly higher in early deals on Thursday led by gains in mining and healthcare stocks, but gains were capped by some stocks such as Daimler going ex-dividend.

Back home, after getting positive start, Indian benchmark indices immediately slipped into negative territory and extended their losses in late morning session, lacking any significant upside cues. Sentiments remained down-beat with report that foreign portfolio investors (FPIs) sold shares worth a net Rs 493.6 crore on April 06, 2016. However, the frontline indices tried to pare the early losses and crawled towards the neutral line in noon trade, but could not succeed as selling pressure accentuated in the late afternoon trades as investors took to across the board risk aversion. Finally the NSE’s 50-share broadly followed index Nifty, took a cut of around a percent to settle below the crucial 7,550 support level, while Bombay Stock Exchange’s Sensitive Index, Sensex slipped by over two hundred points and closed below the psychological 24,700 mark. Moreover, the broader markets too failed to show any kind of fervor and closed with losses of around half a percent. On the BSE sectoral space, the high beta sectors like - Consumer Durables and Capital Goods pockets remained among top laggards in the space as they got lacerated by 2.03% and 1.18% respectively. While sectors like IT, FMCG and Auto too got pounded heavily in the session. On the flipside, PSU and Oil & Gas pockets managed to go home with moderate gains. The market breadth remained awful as there were 1116 shares on the gaining side against 1454 shares on the losing side, while 117 shares remained unchanged.

Finally, the BSE Sensex declined by 215.21 points or 0.86% to 24685.42, while the CNX Nifty dropped 67.90 points or 0.89% to 7,546.45. 

The BSE Sensex touched a high and a low 25013.13 and 24647.48, respectively. The broader indices made a negative closing; the BSE Mid cap index ended down by 0.45%, while Small cap index declined 0.42%

The top gaining sectoral indices on the BSE were PSU up by 0.27% and Oil & Gas up by 0.13%, while Consumer Durables down by 2.03%, Capital Goods down by 1.18%, IT down by 1.18%, FMCG down by 1.17% and Auto down by 1.17% were the top losing indices on BSE.

The top gainers on the Sensex were BHEL up by 4.65%, Coal India up by 1.94%, Lupin up by 1.41%, Dr. Reddys Lab up by 1.05% and ONGC up by 0.83%. On the flip side, Adani Ports &Special down by 3.36%, Maruti Suzuki down by 2.81%, HDFC down by 2.58%, Larsen & Toubro down by 2.24% and ITC down by 1.99% were the top losers.

Meanwhile, the government’s total tax collection for the financial year 2015-16 has exceeded the revised estimate in the budget. Total tax collection during the financial year is pegged at Rs 14.60 lakh crore, which compares favourably with the revised target and represents a growth of 17.6% compared to the last financial year.The aggregate Budget Estimates (BE) for total direct and indirect tax revenues for the fiscal year 2015-16 was Rs 14.45 lakh crore, which was revised to Rs 14.55 lakh crore.

The indirect tax revenue has exceeded budget estimates for 2015-16 by Rs 65,618 crore and the revised estimates by Rs 9,885 crore. The collection represents a growth of 31.1 per cent over 2014-15. Among indirect taxes in the form of customs, excise and service tax, the highest revision was seen for excise duty, which was revised to Rs 2.84 lakh crore from Rs 2.30 lakh crore for 2015-16.  On the other hand, direct tax realisations fell short by Rs 4,000 crore over the revised estimates. The realisation was 7.61 per cent higher than 2014-15 receipts.

While presenting Union Budget for 2016-17, finance minister Arun Jaitley had revised downwards the estimate for direct taxes Rs 45,974 crore to Rs 7,52,021 crore from Rs 7,97,995 crore estimated earlier for the financial year 2015-16. The estimates for indirect taxes, on the other hand, were revised upwards due to which the gross tax revenue target for 2015-16 was revised upwards to Rs 14,59,611 crore from Rs 14,49,490 crore estimated earlier.

The CNX Nifty traded in a range of 7591.75 and 7638.65. There were 32 stocks advancing against 19 stocks decliners on the index.

The top gainers on Nifty were BHEL up by 3.95%, Coal India up by 2.16%, Lupin up by 1.81%, Aurobindo Pharma up by 0.91% and Dr. Reddys Lab up by 0.65%. On the flip side, Tata Power down by 4.41%, Adani Ports &Special down by 3.39%, Maruti Suzuki down by 2.94%, HDFC down by 2.64% and Larsen & Toubro down by 2.62% were the top losers.

European markets were trading in red; Germany’s DAX decreased 26.26 points or 0.27% to 9,598.25, France’s CAC dropped 17.58 points or 0.41% to 4,267.06 and UK’s FTSE 100 was down by 4.2 points or 0.07% to 6,157.43.

Asian equity markets ended mostly higher on Thursday on surge in oil prices and easing concerns about an April US interest rate increase following cautious comments by policy makers in the US Federal Reserve minutes. Japanese stocks edged up, snapping a seven-day losing streak as buying in defensive stocks offset weakness in exporters which lost ground on the yen's strength. The yen held at an 18-month high against the dollar after the Fed's March meeting minutes confirmed the dovish bias of US policymakers. However, China stocks ended lower as investors awaited a slew of Chinese economic data and stayed cautious on signs of increasing default risks in the country's corporate bond market.