Post Session: Quick Review

Extending their winning streak to fourth straight session, boisterous benchmarks showcased an enthusiastic performance on Monday, by rallying around three fourth of a percent. Frontline indices not only ended the session near intraday high levels but also recaptured their crucial 7,900 (Nifty) and 25,800 (Sensex) bastions as investors took to hefty across the board buying. Sentiments remained up-beat with Infosys reporting a stellar Q4 numbers during the weekend, the company’s full-year revenue growth came in at 9.1% in actual currency terms and it gave a bold guidance of 11.8-13.8% for the 2016-17 financial year. Traders also got some encouragement with report that India has received $39.32 billion or Rs 252,562 crore foreign direct investment (FDI), surging by 37 percent during the calendar year 2015. The FDI inflows were at $28.78 billion or Rs 175,313 crore in the year 2014.

Buying got intensified with Wholesale Price Index falling for the 17 straight months at -0.85% in March, as compared to -0.91% in February and -2.33% during the corresponding month of the previous year, despite some spurt in food articles, mainly pulses.  Food inflation stood at 3.73% in March compared with 3.35% in February. Build up inflation rate in the financial year so far was -0.85% compared to a build up rate of -2.33% in the corresponding period of the previous year.

However, global cues remained dampened with European counters making weak opening with oil stocks leading the market lower as crude prices tumbled after a meeting by major exporters in Doha collapsed without a deal to freeze output. Most of the Asian markets ended in red terrain. Japanese shares led regional losses after two powerful earthquakes hit the country last week, killing at least 41 people and forcing major companies to curtail production.

Back home, market participants shrugged off quarterly employment survey report of Labour Bureau, a wing of Labour Ministry, which has said that employment generation in eight key sectors, including gems & jewellery, handloom, leather and automobiles, was at seven-year low of 1,35,000 jobs in 2015. Moreover, the October-December quarter of 2015 saw job losses of 20,000 in eight key sectors compared to previous quarter.

Shares of information technology (IT) edged higher on the bourses after Infosys, India’s second-largest information technology (IT) services firm forecast strong revenue growth of 11.5%-13.5% in constant currency (CC) in the current fiscal (FY17). Shares of aviation and state-owned oil marketing companies remained on buyers’ radar after global crude oil prices eased after talks between the Organisation of the Petroleum Exporting Countries (OPEC) and non-OPEC producers to freeze oil output remained inconclusive. FMCG stocks gained in the wake of the weather office recently predicting good rains during the June-September 2016 southwest monsoon season.

The NSE’s 50-share broadly followed index Nifty surged by over sixty points to end above the psychological 7,900 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex soared by around one hundred and ninety points to finish above its psychological 25,800 mark. Broader markets too traded with traction and ended the session with a gain of over a percent.

The market breadth remained in favor of advances, as there were 1442 shares on the gaining side against 1,179 shares on the losing side while 145 shares remain unchanged. (Provisional)

The BSE Sensex ended at 25816.36, up by 189.61 points or 0.74% after trading in a range of 25634.12 and 25870.03. There were 17 stocks advancing against 13 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 1.26%, while Small cap index up by 1.11%. (Provisional)

The top gaining sectoral indices on the BSE were Realty up by 4.40%, IT up by 3.09%, TECK up by 2.92%, Telecom up by 2.45% and Consumer Durables up by 1.73%, while Bankex down by 0.52%, Auto down by 0.27% and PSU down by 0.13% were the few losing indices on BSE. (Provisional)

The top gainers on the Sensex were Infosys up by 5.63%, Cipla up by 2.50%, Bharti Airtel up by 2.17%, HDFC up by 1.87% and Lupin up by 1.65%. On the flip side, GAIL India down by 2.98%, SBI down by 2.69%, Hero MotoCorp down by 2.57%, ONGC down by 2.49% and ICICI Bank down by 1.91% were the top losers. (Provisional)

The International Monetary Fund (IMF) in its latest World Economic Outlook (WEO) report has said that the Indian government must stick to its fiscal consolidation path and focus on the reforms especially in the labour and infrastructure sectors.  It said that fiscal consolidation should continue, underpinned by revenue reforms and further reductions in subsidies and added that sustaining strong growth over the medium term will require labour market reforms and taking apart of infrastructure bottlenecks, especially in the power sector.

The report further stated that lower commodity prices, supply side measures, and a relatively tight monetary stance have resulted in a faster-than-expected fall in inflation, making room for nominal interest rate cuts, but upside risks to inflation could necessitate a tightening of monetary policy. The report predicted that India would achieve its inflation target of 5 per cent in the first half of 2017, but has warned that an unfavourable monsoon and the effect of public sector wage increases due to the adoption of the Seventh Pay Commission’s recommendations could pose risks. The retail inflation or the Consumer Price Index (CPI) for the month March 2016 eased to a six- month low at 4.83 percent as compared to 5.18 percent in February.

The WEO report has projected that India’s current account deficit would widen sharply to $94.7 billion by 2021. The WEO data show India’s CAD, which was at $26.2 billion or 1.3 per cent of GDP in 2015, will widen to $51.8 billion (2.1 per cent of GDP) by 2017. Furthermore, IMF has retained its GDP growth forecast for India, adding that the main driver of this growth will be private consumption and investment. The report said that “In India, growth is projected to notch up to 7.5 per cent in 2016-17, as forecast in October”.

The CNX Nifty ended at 7914.70, up by 64.25 points or 0.82% after trading in a range of 7842.75 and 7920.60. There were 31 stocks advancing against 20 stocks declining on the index. (Provisional)

The top gainers on Nifty were Infosys up by 5.63%, Idea Cellular up by 5.28%, BPCL up by 4.78%, Ultratech Cement up by 4.03% and Bharti Infratel up by 2.88%. On the flip side, Hero MotoCorp down by 2.97%, Bank of Baroda down by 2.85%, GAIL India down by 2.73%, ONGC down by 2.72% and SBI down by 2.68% were the top losers. (Provisional)

European markets were trading lower; Germany’s DAX decreased 28.71 points or 0.29% to 10,022.86, France’s CAC shed 22.38 points or 0.5% to 4,472.79 and UK’s FTSE 100 was down by 15.66 points or 0.25% to 6,328.09.

Asian equity markets ended mostly lower on Monday, as oil prices tumbled after a summit of major oil producing nations in Doha failed to reach an agreement to freeze oil production. Some 18 oil-exporting nations, including OPEC members, had gathered in Doha, the capital of Qatar, over the weekend in an attempt to agree to stabilize output at January levels until October 2016. The pact fell apart after Saudi Arabia demanded that Iran join in. Japanese shares led regional losses due to a renewed surge of its currency and after two powerful earthquakes hit the country last week, killing at least 41 people and forcing major companies to curtail production.