Post session - Quick review

Indian equity markets concluded uncharacteristically flat on June F&O expiry session, as caution ahead of crucial European Union (EU) summit of leaders, which are deeply divided on how to tackle the long euro zone debt crisis, underpinned investor’s to wind up their massive position ahead of the crucial outcome. In the range bound session of trade, benchmarks after holding onto the respective 17000 (Sensex) and 5150 (Nifty) bastions for the most part of the day, concluded sub those crucial levels. However, markets for the June month series, amassed gigantic gains of over four percentage points. Meanwhile, Midcap index, too registered gains of similar magnitude, unlike Smallcap index, which went home with profit of three percentage points. Some sense of caution was also sensed across the board after reports stated that Prime Minister Manmohan Singh would within the next two to three weeks clear up confusion over tax policy that has rattled investor confidence in Asia's third-largest economy. Meanwhile, the concern of weak monsoon took away most of the gains in the last session.

On the global front, European shares after getting a positive start, slid lower on the expectation that EU summit was unlikely to produce concrete measures to contain the region's debt crisis. The European Union's two-day leaders' summit, which begins later in the day, is expected to produce a broad roadmap for fiscal, financial and political union and may agree a package of growth-boosting measures. Meanwhile, data showing German unemployment, which rose more than expected in June also weighed on investor appetite for euro zone assets. Asian pacific shares ended mixed as a positive start to the session, brought about by encouraging economic data from the U.S., was moderated by persistent caution ahead of a European summit.

Closer home, Power stocks continued to be in the uptrend over optimism of further reform in the sector. Shares in Tata Power (1.2%) saw buying interest for the second day on the back of the tariff hike in Delhi, a key market for the power utility firm. Reliance Infra (-1.2%) saw profit booking though. Banking stocks were down on the back of large block deals in private sector lender Axis (-2.3%) and Yes Bank (-2.2%). Reports suggest HSBC is on course to offload close to 5% stake in Indian private banking major Axis Bank and Yes Bank. Meanwhile, Oil & Gas stocks lost steam on the buzz of petrol price cut. On the BSE sectoral front, FMCG, CD and Power stocks featured in the best list of performers, while stocks from Bankex, Oil & Gas and Capital Goods toppled the selling list. Meanwhile, Tyre stocks lost momentum on the buzz of CCI imposing fine on five leading companies, which control over 95% of market. Ended dejected were stocks from MRF, CEAT, Apollo Tyres and JK Tyres. The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1443:1329 while 128 scrips remained unchanged. (Provisional)

The BSE Sensex lost 14.85 points or 0.09% and settled at 16,952.91. The index touched a high and a low of 17,033.85 and 16,918.87 respectively. 13 stocks were seen advancing against 17 declining ones on the index (Provisional)

The BSE Mid-cap index lost 0.02% while Small-cap index was up 0.11%. (Provisional)

On the BSE Sectoral front, FMCG up 0.78%, Consumer Durables up 0.38%, Power up 0.19%, PSU up 0.06% and IT up 0.06% were the only gainers while, Bankex down 0.70%, Oil & Gas down 0.61%, Capital Goods down 0.28%, Realty down 0.22% and Metal down 0.15% were the top losers.

The top gainers on the Sensex were Tata Steel up 1.38%, ITC up 1.37%, NTPC up 1.32%, Hero MotoCorp up 1.15% and Tata Power up 1.02% while, GAIL India down 2.93%, Hindalco Industries down 1.71%, Sterlite Industries down 1.65%, Sun Pharma down 1.24% and SBI down 1.11% were the top losers in the index. (Provisional)

Meanwhile, according to the recent data released by the Petroleum & Natural Gas Ministry, the production of crude oil in India registered a trivial increase of 0.5% in May to 3.25 million tonnes. May month’s crude oil output at 3.25 million metric tonnes, which is equal to 768,200 barrels a day, rose marginally from 3.23 million tonnes in the same month last year period, but failed to surpass the government’s forecast of 3.33 million tonnes.

Moreover, the production of natural gas in the country prolonged its receding trend in May for the 18th month in a row, underscoring the fact that India is struggling to keep up production at its ageing assets. In May, natural gas production plummeted by 10.8 percent to 3.70 billion cubic meters from last year’s May month figure of 4.14 billion cubic meters, largely on account of sharp decline in gas production by major Reliance Industries from the D6 block in the Krishna-Godavari Basin. However, the numbers managed to surpass the government’s forecast of 3.45 billion cubic meters.

The gap between India’s total domestic gas production of about 115 mmscmd and gas demand of about 165 mmscmd, is met through imports. Asia’s third largest India economy, which meets more than 75 percent of its energy needs through imports, has been taking serious efforts in order to boost domestic production as India’s rising import bill has adversely impacted the nation’s current account deficit and has also stocked inflationary pressures.

However, the declining potential of sedimentary basins and ageing and depleting fields have emerged as major roadblocks for the way of India’s aim to boost domestic energy production. India, the world's fourth largest oil importer, saw its dependence on crude oil and gas imports expand as domestic refiners imported 5.8 percent more crude oil in May year-on-year at 14.586 million tonnes from 13.784 million tonnes in the same period last a year earlier, taking the refining capacity of the country to nearly 215 million tonnes.

India VIX, a gauge for market’s short term expectation of volatility gained 1.22% at 20.62 from its previous close of 20.37 on Wednesday. (Provisional)

The S&P CNX Nifty lost 2.90 points or 0.06% to settle at 5,139.00. The index touched high and low of 5,159.05 and 5,125.30 respectively. 26 stocks advanced against 24 declining ones on the index. (Provisional)

The top gainers on the Nifty were JP Associates up 2.95%, Ambuja Cement up 1.85%, ACC up 1.73%, Tata Steel up 1.68% and NTPC up 1.48%. On the other hand, GAIL India down 3.27%, Sesa Goa down 2.51%, Sterlite Industries down 2.10%, Axis Bank down 2.01% and Reliance Infrastructure down 1.95% were the top losers. (Provisional)

The European markets were trading in red, with France's CAC 40 down 1.00%, Germany's DAX down 1.51% and Britain’s FTSE 100 down 0.78%.

Most of Asian Indices ended day’s trade in red over the concerns that the European summit will not be able to solve problems of the euro zone. The German Chancellor Angela Merkel said that there was no easy solution and magic formula to end the problem of the euro crisis.

Nikkei was up by 1.7 percent to its highest close in six weeks due to short covering as the quarter end neared, as banking and insurance companies were largest gainers. The Hang Seng closed down to 0.8 percent as investor’s booked profit on recent outperforming stocks ahead of the euro zone summit. Shanghai Composite was down near to 1 percent as the cement companies were down followed by a warning from China Resource Cement holdings. KOSPI closed day’s trade on a flat note at 0.08 percent as investors were reluctant to take fresh long position ahead of Euro summit. Straits times was up by 0.22 percent as countries top traded stocks rose by both value and volume including the motor vehicle firm Tan Chong International after 158.6 million shares were transacted at S$2.60 in a block deal.