Post Session: Quick Review

Monday’s session turned out to be a choppy day of trade for Indian equity markets, where frontline gauges somehow managed to keep their head above water. After making a cautious start, markets traded in tight band with domestic bourses altering between green and red terrain for most part of the session amid global turmoil after Britain decided to exit the European Union in a historic referendum on June 24. Despite bout of volatility in last leg of trade, markets snapped the session with marginal gains. Sentiment got some support with India Meteorological Department’s Pune centre report that the monsoon has bounced back emphatically and is on track for a strong run in the weeks ahead, cheering farmers who were rattled by the unexpected lean patch with rainfall 25% below normal in mid-June. The monsoon is expected to reach Punjab, Haryana, Delhi and parts of Rajasthan in a few days. Other regions of the country, which the monsoon has covered, are going to get good rainfall in next five days

Traders also took some encouragement with Finance Minister Arun Jaitley’s statement that the impact of the Brexit vote on India would not be significant, as the underlying fundamentals of the economy were robust. Jaitley however, noted that Indian companies with significant operations in the UK would have to tailor their businesses accordingly to deal with the fallout. Meanwhile, Chief Economic Advisor Arvind Subramanian stated that Britain's exit from the European Union, was a sad development but India would not be affected by it due to India’s solid macroeconomics.

However, gains remained capped on account of weak global cues with European counters making an awful start with CAC, DAX and FTSE trading with a cut of around a percent, weighed down by uncertainty over Britain’s decision to leave the European Union. Asian markets ended mixed as market participants struggled to digest the uncertainty triggered by Britain’s decision to exit the European Union.

Back home, appreciation in Indian rupee provided some strength to domestic sentiments. The Indian currency strengthened by 5 paise at Rs 67.91 to the US dollar at the time of equity markets closing as compared to the previous close of Rs 67.96. On the sectoral front, stocks related to pharmaceuticals, defence counters remained on buyers’ radar, as the government notified changes in the Foreign Direct Investment (FDI) policy in these sectors. Broader markets however outperformed benchmarks. Stocks of public sector oil marketing companies (OMCs) edged higher after steep fall in global crude oil prices. On the flip side, software stocks extended their previous sessions’ losses triggered by the UK’s referendum outcome on 24 June 2016 showing it had voted to leave European Union.

The NSE’s 50-share broadly followed index -- Nifty -- rose marginally to end near the psychological 8,100 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex -- surged by five points to finish above the psychological 26,400 mark. However, broader markets outperformed benchmarks and ended the session with a gain of around a percent.

The market breadth remained in the favour off advances, as there were 1,812 shares on the gaining side against 799 shares on the losing side while 176 shares remain unchanged. (Provisional)

The BSE Sensex ended at 26402.96, up by 5.25 points or 0.02% after trading in a range of 26262.72 and 26493.51. There were 15 stocks advancing against 15 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.80%, while Small cap index was up by 1.52%. (Provisional)

The top gaining sectoral indices on the BSE were Basic Materials up by 1.91%, Capital Goods up by 1.62%, Realty up by 1.29%, FMCG up by 1.25% and Oil & Gas up by 1.07%, while IT down by 1.86%, TECK down by 1.66%, Auto down by 0.25% and Telecom down by 0.13% were the few losing indices on BSE. (Provisional)

The top gainers on the Sensex were Dr. Reddys Lab up by 3.04%, Cipla up by 2.94%, SBI up by 2.56%, Sun Pharma Inds. up by 2.30% and Larsen & Toubro up by 2.23%. On the flip side, TCS down by 2.96%, Infosys down by 2.16%, Wipro down by 1.43%, Asian Paints down by 1.39% and Bajaj Auto down by 1.34% were the top losers. (Provisional)

Meanwhile, India is identifying basket of projects worth $2-3 billion that could be funded by the Asian Infrastructure Investment Bank (AIIB) in the areas of urban development, including smart cities, urban transport, energy, inland waterways and water supply. Finance Minister Arun Jaitley said that India has a huge unmet demand for investment in infrastructure and is preparing a basket of projects for AIIB funding.

Meanwhile, Jaitley has made the offer to open a regional office of China-led lender AIIB branch a regional office in New Delhi (India) to effectively cater to potentially large portfolio and speed up the process of project development, monitoring and implementation. Stating the importance of AIIB, Jaitley said that AIIB presents a much-needed additional financing window dedicated to infrastructure projects and meeting the financing gap that may be beyond the capacity of the individual countries and the existing MDBs (Multilateral Development Banks).

The Beijing-based AIIB was established last year with an authorized capital of $100 billion in which India and 56 other countries joined as founding members. China is the largest shareholder with 26.06 per cent voting shares followed by India with 7.5 per cent, Russia 5.93 per cent and Germany with 4.5 per cent. AIIB is headed by former Assistant Chinese Finance Minister, Jin Liqun, while India’s DJ Pandian is its Vice President and Chief Investment Officer.

The CNX Nifty ended at 8094.70, up by 6.10 points or 0.08% after trading in a range of 8039.35 and 8120.65. There were 27 stocks advancing against 23 stocks declining on the index. (Provisional)

The top gainers on Nifty were Aurobindo Pharma up by 3.28%, Ultratech Cement up by 3.22%, Bank of Baroda up by 3.19%, Dr. Reddys Lab up by 2.96% and SBI up by 2.79%. On the flip side, TCS down by 3.03%, Infosys down by 2.37%, Zee Entertainment down by 1.92%, Asian Paints down by 1.54% and Indusind Bank down by 1.46% were the top losers. (Provisional)

European markets were trading in red; Germany’s DAX declined 99.27 points or 1.04% to 9,457.89, UK’s FTSE 100 decreased 62.22 points or 1.01% to 6,076.47 and France’s CAC was down by 34.1 points or 0.83% to 4,072.63.

Asian stocks ended mixed on Monday as investors looked to snap up bargains after Friday's dramatic selloff sparked by Britain's surprise decision to leave the European Union. Some sanity returned to the markets after thirty central banks across the world vowed to work closer together to maintain stability in financial markets in the aftermath of the Brexit vote. Chinese shares ended higher after Premier Li Keqiang said the government has policies prepared to help it weather bigger economic challenges ahead. Japanese shares regained some lost ground after government officials warned again over the yen's rise and signaled an intervention in currency markets was possible.