Post Session: Quick Review

Erasing almost all of their initial gains, Indian equity benchmarks ended Thursday’s trade flat. Markets made a gap-up opening as traders remained encouraged on positive macroeconomic data and above-normal monsoon forecast. Traders got some encouragement with Rajan praising government efforts and said that the current growth rate reflects the hard work of the government. He also said that India should find ways to support higher economic growth on a sustainable basis and not fritter away gains as it did in the past. Some support came with the report that Indian business leaders continue to be the most optimistic lot globally about the country’s economic outlook for the second consecutive quarter owing to a strong GDP growth, recent policy announcements and regulatory changes. According to the Grant Thornton International Business Report (IBR) a quarterly global survey of 2,500 business leaders across 36 economies, 90% of the respondents in India expressed confidence in the country's economic outlook.

Key gauges reversed momentum and entered into red terrain in last leg of trade as investors opted to book profit at higher levels, but volatility in dying hour of trade helped markets to end flat. Traders also turned cautious as RBI Governor Raghuram Rajan talking on euphoria about India being the world's fastest-growing economy has said that India still remains one of the poorest nations in the world on a per capita basis and have a long way to go before we reasonably address the concerns of each one of our citizens.

Selling got accelerated after European counters making a weak start with all CAC, DAX and FTSE were declining around a percent in early deals. However, Asian markets ended mostly in green as global crude oil prices cruised higher on lower-than-expected US crude oil inventory levels and renewed hopes that oil producers might meet once again to reduce production.

Back home, software counter remained under pressure after Wipro reported a sequential 0.2% drop in net profit to $337 million for the three months to March. Infra sector stocks edged lower despite minister for road transport and highways Nitin Gadkari setting a goal of building 15,000 km of highways this fiscal, two and a half times what was achieved last year. However, banking stocks mainly public sector undertakings (PSU) remained on buyers’ radar on the bourses after some report stated that the Reserve Bank of India (RBI) has trimmed the list of debt-laden companies for loan provisioning in the fourth quarter ended March 31, 2016.

The NSE’s 50-share broadly followed index Nifty declined marginally but hold the psychological 7,900 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex rose over thirty points to finish tad below its psychological 25,900 mark. Broader markets too struggled to get any traction and ended the session with a cut of over half a percent.

The market breadth remained in favor of decliners, as there were 1,070 shares on the gaining side against 1,485 shares on the losing side while 166 shares remain unchanged. (Provisional)

The BSE Sensex ended at 25880.38, up by 36.20 points or 0.14% after trading in a range of 25783.12 and 26080.07. There were 14 stocks advancing against 16 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 0.50%, while Small cap index down by 0.52%. (Provisional)

The top gaining sectoral indices on the BSE were Bankex up by 1.95%, PSU up by 1.24%, Finance up by 1.23, Energy up by 0.78% and Utilities up by 0.78%, while IT down by 1.53%, Realty down by 1.47%, TECK down by 1.37%, Basic Materials down by 1.22 and Power down by 1.09% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were ICICI Bank up by 6.26%, SBI up by 3.68%, Coal India up by 2.89%, Axis Bank up by 2.08% and ONGC up by 1.72%. On the flip side, Wipro down by 7.01%, BHEL down by 2.86%, Hero MotoCorp down by 2.00%, Infosys down by 1.63% and ITC down by 1.61% were the top losers. (Provisional)

Meanwhile, the government has approved amending the Compensatory Afforestation Fund (CAF) Bill, 2015, which aims to ensure expeditious utilization of around Rs 40,000 crore for increasing forest cover in India which is currently lying unspent. The amendments include deleting some of environmental services for which credible model to assess their monetary value does not exist while it also provides for prior consultation with states for making a rule under it.

Furthermore, the amendments provide for use of monies realised from the user agencies in lieu for forest land diverted in protected areas for voluntary relocation from protected areas. The Bill is expected to be tabled in Parliament in the second half of the Budget session, which will commence from April 25.

The government said the legislation will ensure expeditious utilisation of accumulated unspent amounts available with the ad hoc Compensatory Afforestation Fund Management and Planning Authority (CAMPA), which is currently around Rs 40,000 crore, and fresh accrual of compensatory levies and interest on accumulated unspent balance, which will be of the order of approximately Rs 6,000 crore per annum, in an efficient and transparent manner.

Earlier on May 8, 2015, the government had introduced the Compensatory Afforestation Fund Bill, 2015, in the Lok Sabha. However, on 13th May, 2015 Lok Sabha referred the Bill to the Department-related Parliamentary Standing Committee on Science & Technology, Environment & Forests. On 26th February, 2016 the Committee submitted its report to the Parliament. The Central Government after examination of the report of the Department-related Parliamentary Committee proposed to move official amendments in the Bill.

The CNX Nifty ended at 7912.05, down by 2.70 points or 0.03% after trading in a range of 7884.10 and 7978.45. There were 19 stocks advancing against 31 stocks declining on the index. (Provisional)

The top gainers on Nifty were ICICI Bank up by 6.30%, SBI up by 3.76%, Bank of Baroda up by 3.34%, Coal India up by 3.27% and Axis Bank up by 1.93%. On the flip side, Wipro down by 7.05%, Bharti Infratel down by 3.75%, BHEL down by 3.05%, Ultratech Cement down by 3.05% and ACC down by 2.34% were the top losers. (Provisional)

European markets were trading in red; UK’s FTSE 100 decreased 33.44 points or 0.52% to 6,376.82, France’s CAC slipped 14.82 points or 0.32% to 4,577.10 and Germany’s DAX was down by 10.78 points or 0.1% to 10,410.51.

Asian equity markets ended mostly higher on Thursday as oil prices rallied and the yen resumed its decline on expectations of further easing from the Bank of Japan next week. Most investors were reminded focused on the European Central Bank meeting due later in the day, although no change in policy is expected after unprecedented monetary stimulus at the March policy meeting. Japanese shares rose for a third day to hit a 2-1/2 month high, as oil prices bounced back and positive US housing data as well as expectations of further policy easing from the Bank of Japan (BoJ) weakened the yen to near the 110 level. However, China stocks closed lower on Thursday as afternoon profit-taking in finance and manufacturing shares offset early gains by commodity stocks in the morning following oil's sharp overnight rise.