Post session - Quick review

Market’s suffered a nasty blow of over 5% for the May month’s F&O series, with the final session, managing to absorb Q4 GDP’s shocker, Indian equity markets slug hard to recover substantial lost ground. 30 scrip sensitive index, Sensex although registering 0.30% loss, reclaimed the 16200 bastion. Similarly, the widely followed 50 share index, Nifty too, wiping out significant portion of losses, concluded in proximity to the previous closing levels.

Pounded by the gloomy global set-up, markets earlier went into the tizzy, tracing the beleaguered Indian currency, which sneaking past 56/$ mark, scaled historic lows in early deals.  However, recuperation of Indian currency, after RBI’s intervention, which mandated Oil Marketing companies to buy forex from selected PSU banks, led to shore-up the confidence, which otherwise took a hit tracking the sluggish fourth quarter GDP data, that slowing to a decade low level, stood at 5.3 percent in the January-March quarter of the financial year as against 7.8 per cent in the same quarter last year, mainly due to contraction in manufacturing sector and depreciating rupee. Encouraging European leads spurred some optimism at Dalal Street. Recovering their sheen after steep losses in the previous session, European shares moved higher on Tuesday after recovery in Spanish and Italian bond. Yield on Spain's 10-year government bond was down three basis points at 6.62%, while the corresponding Italian yield was down five basis points at 6.01%.

On the flip side, Asian counterparts weighed down on the domestic market sentiment. Investors rushed to safety in Asia after Spanish government stated that it would auction treasury bonds to raise cash for the bailout of beleaguered local bank Bankia.

Closer home, ‘Bharat Bandh’ call from opposition party in protest to last week’s hike in petrol prices, too made some impact on the local equities. Rate sensitive’s, Realty and Bankex, combined with high beta Consumer Durable and Capital Goods, did a lot of harm to markets. However, short-covering coupled with value buying, in the dying hours of trade, provided some solace to the Indian equity markets. 

The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 1201: 1400 while 105 scrips remained unchanged. (Provisional)

The BSE Sensex lost 93.62 points or 0.57% and settled at 16,218.53.The index touched a high and a low of 16,277.48 and 16,086.06 respectively. 13 stocks advanced against 17 declining ones on the index (Provisional)

The BSE Mid-cap index gained 0.36% while Small-cap index was down by 0.57%. (Provisional)

On the BSE sectoral front, Realty up by 1.00%, IT up by 0.35%, TECk up by 0.31%, Public Sector Undertaking up by 0.29% and Power up by 0.21% were the top gainers, while Auto down by 1.96%, Bankex down by 0.87%, Consumer Durable (CD) down by 0.81%, Capital Goods (CG) down by 0.70%, Metal down by 0.21% and were the top losers. (Provisional)

The top gainers on the Sensex were, Infosys up by 2.58%, Hindalco Industries up by 1.79%, HDFC Bank up by 1.43%, DLFup by 1.04%, RIL up by 0.98% and while Tata Motors down by 4.03%, ICICI Bank down by 3.98%, Maruti Suzuki down by 3.34%, Sun Pharma down by 2.92% and Jindal Steel down by 2.45% were the top losers. (Provisional)

Meanwhile, the economy has grown by a mere 5.3% in the fourth quarter of 2011-12 - lowest quarterly growth rate in 3 years as against 7.8% in the same quarter last year. It is much below the expected number of 6.1% and the major dampening has come in from the manufacturing sector. For the entire year, the GDP growth has now been revised to 6.5%. For the fourth quarter, services grew 7.9% compared to 10.6% last year, farm sector growth fell to 1.7% from 7.5%, manufacturing sector logged negative growth of 0.3% against 7.6%, and construction sector growth fell to 4.8% from 8%.

As stated earlier there has been a downward revision of GDP numbers for FY12. As per the Central Statistics Office (CSO), the downward revision has come in because of the lower performance in manufacturing and 'trade, hotels, transport and communications' than expected.

For 2011-12, the revised GDP growth estimate has taken into account the agricultural growth at 2.8%, higher than the level of 2.5% at the advance estimate stage. The manufacturing sector output is pegged at 2.5%, lower than the 3.9% growth put out at the advance estimate stage. Construction sector is now estimated to have grown 5.3% in 2011-12, higher than 4.8% estimated earlier in February this year.

With the numbers coming in lesser than expected the focus has again shifted towards the RBI’s monetary policy. C Rangarajan, chairman, Prime Minister’s Economic Advisory Council has stated that the RBI shall continue to focus on inflation and may not go in for another rate cut. Some economists on the other hand, feel that inflation probably has now bottomed out and the RBI should focus on reviving growth. Economists are also now less enthusiastic about the GDP numbers of the current fiscal and feel that they will hover around the 6% mark.

India VIX, a gauge for market’s short term expectation of volatility lost 0.19% at 25.25 from its previous close of 25.30 on Wednesday. (Provisional)

The S&P CNX Nifty lost 26.50 points or 0.54% to settle at 4,924.25. The index touched high and low of 4,949.25 and 4,883.55 respectively.21 stocks advanced against 29 declining on the index. (Provisional)

The top gainers on the Nifty were JP Associats up by 3.66%, Asian Paint up by 3.50%, IDFC up by 3.37%, SAIL up by 2.55% and PNB up by 2.46% (Provisional)

On the other hand Maruti Suzuki down by 4.00%, ICICI Bank down by 3.90%, Tata Motors down by 3.89%, Jindal Stel down by 2.71%, and Bank of Baroda down by 2.21% were the top losers. (Provisional)

The European markets too were trading in green, with France's CAC 40 up by 0.67%, Germany's DAX up by 0.37% and Britain’s FTSE 100 up by 0.77%.

Asian markets continued their southbound journey for second day in a row on Thursday following selloff in US market overnight as yields on Spain’s 10-year bonds reached as high as 6.65%. The sell-off came after the European Central Bank said in a statement that it had not been consulted on the bailout for Bankia, Spain’s fourth-largest bank, and that such a recapitalization could not be provided by the Euro-zone central bank. The sentiments were also got clobbered after Chinese interest-rate swaps hit 18-month lows on Thursday on abundant liquidity and expectations of loose monetary policy in the coming months. One-year interest-rate swaps fell nine basis points to 2.42 percent near midday, their lowest since November 2010.

Meanwhile, Japanese Nikkei snapped the session with cut of over a percent, as the country reported anemic factory output growth of 0.2% in April, slower than expected. While, Taiwan benchmark fell over half a percent on Thursday, joining regional bourses in slides on mounting concern over Europe’s ability to solve its growing debt crisis and led by heavyweights such as TSMC. In addition Kospi edged lower as crude oil refiners underperformed; SK Innovation slid 3.5 percent while S-Oil fell 3.2 percent.