Post session - Quick review

It was a lackluster session for benchmark Indian equities markets, which witnessed consolidation after previous week’s smart rally and concluded in red on Monday to start the F&O expiry week that witnessed huge volume turnover of Rs 1.90 lac core.

Lack of buying interest combined with bleak global cues mainly led to Monday blues for Dalal Street. Reports which pointed out rating agency, S&P lowered India’s GDP growth forecast to 5.5%, discouraged investor’s from investing into risky assets class such as equities.

Thus, in the choppy session of trade, 30 share barometer index of Bombay Stock Exchange (BSE), Sensex, declined over quarter of percent to shut shop below the 18700 psychological level. Similarly, widely followed index of National Stock Exchange, Nifty too, after offloading similar proportion of weight shut shop sub 5700 crucial level.

On the global front, Asian pacific shares ended mostly in negative terrain as investors shifted their focus to weak economic fundamentals while monitoring progress in the euro zone debt bailout scheme. Meanwhile, European shares got a sluggish start with investors refocusing on the gloomy economic outlook and Spain's unresolved debt crisis as euphoria over global monetary stimulus efforts faded.

Closer home, lot of sector specific activity was witnessed in today’s trading session. Stocks of Power sector stocks viz, Bharat Heavy Electricals, Power Finance Corporation and Rural Electrification Corporation rallied on hopes of restructuring of loans for State Electricity Boards. Meanwhile, Sugar stocks too were in demand on expectation of sugar price hike. Cabinet Committee on Economic Affairs (CCEA) is likely to consider on Tuesday a proposal to raise price of sugar sold through ration shops, which if approved would be the first hike in about a decade. On the flip side, Information Technology stocks capitulated to selling pressure on stronger rupee, as these firms derive a lion share of their revenue in dollars.  However, defensives sectors Fast Moving Consumer Goods and Healthcare too were drag for markets as investors showed appetite for high-beta stocks on renewed hopes of reform measures.

On the BSE sectoral front, stocks from Power, Realty and Capital Goods counters hogged limelight and ended up with gains of over a percent and half. Conversely, stocks from Fast Moving Consumer Goods, Oil & Gas and Public Sector Undertaking (PSU), continuing to be on seller’s radar for the entire trading session, emerged as the top laggards. However, Oil Marketing companies, barring BPCL,  showcased resilience in lights of reports which stated Competition Commission of India (CCI) ordered detailed investigation into alleged cartel-like behavior of oil marketing companies (OMC’s) increasing and decreasing prices of petrol in unison. The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1691:1197 while 127 scrips remained unchanged. (Provisional)

The BSE Sensex lost 77.08 points or 0.41% and settled at 18,675.75. The index touched a high and a low of 18,811.13 and 18,650.43 respectively. 13 stocks advanced while 17 stocks declined on the index. (Provisional)

The BSE Mid-cap index was up by 0.39% while Small-cap index was up 0.86%. (Provisional)

On the BSE Sectoral front, Power was up 1.92%, Realty was up 1.48%, Capital Goods up by 1.30%, Consumer Durables was up 0.73% and Auto up 0.68% were the top gainers, while FMCG down 1.43%, Oil & Gas down by 1.38%, TECk down by 0.43%, IT down by 0.37% and PSU down by 0.34% were the top losers in the space.

The top gainers on the Sensex were BHEL up 6.69%, Jindal Steel up 4.62%, M&M up by 3.57%, Maruti Suzuki up 3.37% and HDFC Bank up 1.60% while, HDFC down by 2.59%, HUL down by 2.18%, ITC down by 2.16%, Reliance Industries down by 1.69% and ONGC down by 1.65% were the top losers in the index. (Provisional)

Meanwhile, notwithstanding the series of reforms the government announced in the past two weeks, rating agency Standard & Poor's (S&P) today scaled down India's GDP growth forecast to 5.5%. The S&P forecast is part of a broader report on Asian economies, where the agency also slashed China’s gross domestic product (GDP) growth forecast to 7.5% from 8% and Japan’s to 2% from 2.5%. The rating agency, which has added to the spate of downgrades from global investment banks and rating agencies, in April, had lowered its outlook on India's sovereign rating of `BBB-' to negative. 

Besides, slew of rating agency and global investment banks slashing its outlook on India’s GDP growth, Prime Minister's Economic Advisory Council (PMEAC) foreseeing global headwinds, sluggish policymaking, high interest rates and worries about a drought in parts of the country suppressing investment and demand, also slashed its economic growth projections for the current fiscal to 6.7% from an earlier 7.5-8%. Further, India’s plan panel also lowered annual average economic growth rate to 8.2% in the 12th Five Year Plan (2012-17) from earlier average economic growth rate of 9% due to lower economic growth and lack of appropriate policy measures.

However, driven by higher-than-expected performance on the agriculture front, India’s GDP grew at 5.5 per cent in the June 2012 quarter after declining in eight consecutive quarters. Agriculture emerged as the only saving grace for the sagging economy, which witnessed a near-stalling of industrial activity. Agriculture came in at better than expected at 2.9 per cent, as against major economists’ estimates at 2 percent

India VIX, a gauge for markets short term expectation of volatility lost 0.52% at 18.83 from its previous close of 18.93 on Friday. (Provisional)

The S&P CNX Nifty lost 19.50 points or 0.34% to settle at 5,671.65. The index touched high and low of 5,709.85 and 5,662.75 respectively. 21 stocks advanced against 29 declining ones on the index. (Provisional)

The top gainers on the Nifty were BHEL was up 7.27%, Jindal Steel up 4.64%, Maruti Suzuki up 3.74%, M&M up 3.72% and Reliance Infrastructure was up 3.17%. On the other hand, HDFC down 2.77%, ONGC down by 2.55%, SAIL down by 2.37%, ITC down by 2.20% and HUL down 2.15% were the top losers. (Provisional)

The European markets were trading in red with, France’s CAC 40 down 1.23%, Germany’s DAX down 0.73% and the United Kingdom’s FTSE 100 down 0.60%.

Asian markets made a mixed closing on Monday, though the mood in the region remained subdued since morning but few of the indices showed good efforts to close in green in the dying hours. There was concern related to Europe that kept the markets under pressure, as Germany and France disagreed on when to introduce a banking union for the 17-nation single currency and attempts to resolve the region’s debt crisis seemed deadlocked. On the same time the reports from China remained discouraging, as a survey pointed out that manufacturers and retailers in the nation are less optimistic about sales than they were three months ago and are cutting jobs. Meanwhile, China’s overnight money-market rate climbed to a seven-month high on speculation cash shortages will worsen when the financial markets will remain closed for a week starting October 1.