Post Session: Quick Review

Local equity markets, snapping three consecutive sessions of gaining streak ended lower on Tuesday with losses of over half a percent. The selling intensified during second half of the day and dragged the key benchmark indices BSE Sensex and NSE Nifty below their crucial 35,000 and 10,650 levels, respectively. Domestic bourses made a cautious start, due to profit-booking by funds and retail investors and weak Asian cues owing to uncertainty over the US-North Korea summit and a political crisis in Italy. However, markets pared losses and traded marginally in green with taking relief from Economic Affairs Secretary Subhash Chandra Garg’s statement that the Indian economy is expected to grow between 7.3-7.5 percent in the March quarter. The government will release GDP data on Thursday. He said the country was expected to grow at 6.7 percent in the 2017/18 financial year that ended in March.

But, markets once again slipped into negative territory in the second half of the day, as sentiments turned pessimistic with a private report stating that the June policy review meeting is likely to be a close call, while the tone of the policy statement is expected to remain hawkish. The markets participants paid no heed towards report that the Finance Ministry has clarified applicability of the Goods and Services Tax (GST) on farmers. It has said that support services like renting or leasing of land by farmers for agriculture, forestry, fishing or animal husbandry are exempt from the ambit of new indirect tax. Traders failed to get any relief from report that southwest monsoon hit Kerala, three days before its scheduled arrival. The IMD has made a forecast of ‘normal’ rainfall this season. Moreover, depreciation in Indian rupee too weighed on the sentiments. The rupee dropped by 44 paise to 67.86 against the dollar at the time of equity markets closing on continued demand for the American unit coupled with its growing strength overseas.

On the global front, Asian markets closed in red, as the fall in crude oil prices and the prospects of fresh elections in Italy offset optimism over a possible revival in diplomatic talks between the US and North Korea. European markets were trading in red in early deals on Tuesday, led by a selloff in Italian equities. Investors were assessing the prospect of new elections in Italy, which could serve as a referendum on the euro.

The BSE Sensex ended at 34949.24, down by 216.24 points or 0.61% after trading in a range of 34922.18 and 35234.14. There were 8 stocks advancing against 23 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 0.44%, while Small cap index was down by 0.26%. (Provisional)

The top gaining sectoral indices on the BSE were Oil & Gas up by 0.49%, Auto up by 0.43%, IT up by 0.34%, Telecom up by 0.23% and TECK up by 0.10%, while Bankex down by 1.61%, Healthcare down by 0.80%, Consumer Durables down by 0.77%, Realty down by 0.76% and PSU down by 0.55% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Mahindra & Mahindra up by 2.99%, Bharti Airtel up by 1.27%, Infosys up by 0.52%, Hero MotoCorp up by 0.45% and TCS up by 0.43%. (Provisional)

On the flip side, ICICI Bank down by 2.99%, SBI down by 2.92%, Indusind Bank down by 1.80%, Kotak Mahindra Bank down by 1.63% and Asian Paints down by 1.49% were the top losers. (Provisional)

Meanwhile, Union Minister of Petroleum and Natural Gas, Dharmendra Pradhan assured that the government is working on a holistic strategy to find long-term solution to spurt in petrol and diesel prices caused by a rally in international oil prices. He noted that bringing petroleum products under the ambit of the Goods and Services Tax (GST) is one among them. He said “I have already categorically stated on this issue several times.” Besides, he also pointed out that the present oil price hike is due to three main factors - hike in international price of crude, fluctuation in dollar and Indian currency ratio and some of the tax issues are also there.

However, Pradhan did not respond to a query on the timeline by when petroleum products could be brought under GST.  He also refused to say if the government is planning a cut in excise duty to provide relief to consumers. The government had raised excise duty on petrol by Rs 11.77 a lire and that on diesel by 13.47 a litre in nine instalments between November 2014 and January 2016 to shore up finances as global oil prices fell, but then cut the tax just once in October last year by Rs 2 a litre.

Petrol and diesel prices continued the upward trend for the 16th consecutive day on Tuesday, even as global crude oil prices receded from record high levels. Petrol in Delhi costs Rs 78.43 a litre and diesel is priced at Rs 69.31. Delhi has the lowest fuel price among all metros and most state capital due to lower incidence of local sales tax or VAT.

The CNX Nifty ended at 10631.30, down by 57.35 points or 0.54% after trading in a range of 10616.10 and 10717.25. There were 16 stocks advancing against 34 stocks declining on the index. (Provisional)

The top gainers on Nifty were Mahindra & Mahindra up by 2.88%, GAIL India up by 2.14%, HCL Tech up by 1.62%, Bharti Airtel up by 1.59% and Indian Oil up by 1.09%. (Provisional)

On the flip side, ICICI Bank down by 3.17%, SBI down by 3.09%, Bajaj Finserv down by 2.35%, Zee Entertainment down by 2.30% and Yes Bank down by 1.98% were the top losers. (Provisional)

The European markets were trading in red; Germany’s DAX decreased 216.26 points or 1.68% to 12,647.20, UK’s FTSE 100 decreased 106.82 points or 1.38% to 7,623.46 and France’s CAC decreased 95.03 points or 1.73% to 5,413.90.

Asian equity markets ended lower on Tuesday as investors monitored oil prices and kept an eye on political developments in Italy. The prospects of fresh elections in the country offset optimism over a possible revival in diplomatic talks between the US and North Korea. Chinese shares ended lower on concerns about rising credit risks in the country. Further, Japanese shares hit a one-month low as concerns over European politics and uncertainty over the prospects for a US-North Korea summit sapped investors' appetite for risk. Meanwhile, the markets in Malaysia, Singapore, and Indonesia are closed for Wesak Day.