Post session - Quick review

Expiry day of September series futures and options (F&O) contract was not an exceptional one for Indian equity markets, which after trading lackluster for the past four trading sessions, added to the losing spree. However, despite the lackluster week, the markets for the September F&O series clocked massive gains of over 6% each. For the session, 30 share index of Bombay Stock Exchange (BSE), Sensex, knocked over 50 points to shut shop below the 18600 level, after touching a high past 18700 psychological level. Similarly, the widely followed index of National Stock Exchange, Nifty, declining over 15 points, concluded below the crucial 5650 level. Conversely, the broader indices outperforming the frontline indices with fat margins went home with gains of over 0.50% (BSE Midcap index) and over 0.15% (BSE Smallcap index).Meanwhile, little sense of respite was drawn by investors, as in a big relief for government, Supreme Court accepted that auction was not a must for all resources, partly because the latter accepted that the government rights to decide policy, and also because it emphasized that “maximization of revenue”, could not be sole criteria in all situations and circumstances. However, the nervousness of traders ahead of the announcement of government's borrowing calendar for the second-half of the fiscal year, a key indicator of its fiscal discipline, mainly led to the downturn of the bourses.

Positive global set up also failed to lift up the spirit of the bourses on the last trading session of September series futures and options (F&O) contract, as markets adding to the previous session’s downturn, lost some more ground on Thursday. European shares reclaimed some of the previous day's sharp losses early on Thursday, amid hopes Spain's budget could nudge Madrid towards accepting a rescue programme and allowing the ECB to launch its new bond buying plan. Additionally, Asian pacific shares turned higher, buoyed by a sharp upturn in Chinese shares. The Shanghai Composite Index jumped nearly 3% on speculation that authorities might take steps to prop up the mainland’s beleaguered stock markets.

Closer home, lot of sector specific action was witnessed in today’s trading session. Shares of telecom companies rang off after the Supreme Court gave its verdict on the presidential reference on 2G spectrum allocation. In the much order Apex Court said the 2G spectrum airwaves must be auctioned. Meanwhile, fertilizer shares, viz, Coromandel International, Zuari Global, National Fertilizers, Chambal Fertiliser & Chemicals rose on favourable outlook for Rabi or winter crop following wide-spread rains in August and September. On the BSE sectoral front, Fast Moving Consumer Goods, Consumer Durables and Capital goods counters emerged as the prominent gainers, while Oil & Gas, Information Technology and Metal counters depicted the underlying weakness of the bourses.

On the F&O front, September series Nifty and Sensex added further ground by garnering gains of over 6% each, after registering 5% gains in August series. Moreover, the broader markets outperformed their larger peers by a fat margin as by the end of series as the CNX Mid Cap index garnered gains of over 9% while BSE Smallcap index too added 9.2% respectively.

From the expiry perspective, market wide rollover of 62.66% was observed, which was lower than the three month average of 64.47% while Nifty rollovers were at 52.73%, lower than three month average of 53.16%. Sectorally, power, capital goods and cement stocks witnessed high rollover of positions while the technology, telecom and oil & gas space observed relatively low rolls into the October series. Among individual stocks, Tech Mahindra (46%), Bank of Baroda (50%) and M&M (51%) witnessed marginally low rolls while Maruti (72%), Bhel (71%) and Cipla (70%) observed better rollover into the October series.

The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1527:1310 while 151 scrips remained unchanged (Provisional). Meanwhile, the session ended on overall volumes of over Rs 3.07 lakh crore. 

The BSE Sensex lost 63.37 points or 0.34% and settled at 18,568.80. The index touched a high and a low of 18,735.95 and 18,552.68 respectively. 8 stocks were seen advancing while 22 stocks were declining on the index (Provisional)

The BSE Mid-cap index was up by 0.64% while Small-cap index was up 0.22%. (Provisional)

On the BSE Sectoral front, Consumer Durables was up 1.49%, FMCG up by 1.43%, Capital Goods was up 0.91%, Realty up by 0.59% and Health Care was up 0.19% were the only gainers, while Oil & Gas down 1.53%, IT down by 0.97%, TECk down by 0.76%, Metal down by 0.67% and PSU down by 0.33% were the top losers in the space.

The top gainers on the Sensex were Tata Power up 2.78%, L&T up 2.15%, HUL up by 1.49%, ITC up 1.06% and SBI up 0.98% while, Sterlite Industries down by 3.13%, Hero MotoCorp down by 2.32%, ONGC down by 2.10%, BHEL down by 1.92% and Infosys down by 1.60% were the top losers in the index. (Provisional)

Meanwhile, Investment bank Credit Suisse besides pruning India’s gross domestic product (GDP) growth forecast for the fiscal year ending in March 2013 to 6% from 6.5%, also slashed its forecast for fiscal 2013-14 to 7.2% from 7.8%. The integrated global bank, in its note besides pointing at the lag of with which monetary policy operates, underscored monetary easing to have a bigger impact on 2014/15 GDP growth than 2013/14.

Further, Credit Suisse expects a cut in interest rates by an additional 125 basis points (bps) by the end of the current fiscal year, including a 50 bps cut in October. Furthering its anti-inflationary stance, world’s most aggressive central bank, Reserve Bank of India (RBI), maintained a status quo on key policy rates, viz. repo and reverse repo, in its last mid-quarter monetary policy review on September 17, 2012.

On the flip side, US rating agency, Moody’s on Sept 26, reiterated its stable credit outlook on India, saying that it ‘doesn’t see a rating downgrade as growth slowdown is not irreversible.’ However, Moody’s despite expecting improvement in economic growth on the back of consumer demand, the rating agency doesn’t see India meeting its fiscal deficit target.

However, the government, off lately has announced slew of measures in the last fortnight to contain fiscal deficit. The measures included reducing subsidy bill by increasing diesel prices by Rs 5 per litre and capping the number of LPG cylinders to nine per household.

India VIX, a gauge for markets short term expectation of volatility lost 0.35% at 16.91 from its previous close of 16.97 on Wednesday. (Provisional)

The S&P CNX Nifty lost 18.40 points or 0.32% to settle at 5,645.05. The index touched high and low of 5,693.70 and 5,639.70 respectively. 19 stocks advanced against 30 declining ones while 1 stock remained unchanged on the index. (Provisional)

The top gainers on the Nifty were Tata Power was up 2.63%, L&T up 2.09%, HCL Tech up 1.96%, HUL up 1.72% and DLF was up 1.35%. On the other hand, SAIL down 3.81%, Sesa Goa down by 3.38%, Sterlite Industries down by 3.13%, Cairn India down by 2.20% and ONGC down 2.13% were the top losers. (Provisional)

The European markets were trading in green with, France’s CAC 40 up 0.78%, Germany’s DAX up 0.52% and the United Kingdom’s FTSE 100 up 0.41%.

Asian markets rebounded from earlier days losses and ended higher on Thursday amid hopes for fresh Chinese stimulus. However, worries over a bailout for Spain and signs of Europe struggling to find a unified approach to tackle its debt crisis, capped the market gains. Shanghai Composite ended with gains of 2.6%, recovering from the multi-year low on Wednesday, on the buzz that local securities regulators will broadcast market boosting measures at a press conference later today. Hong Kong shares ended higher amid short covering in banking stocks, while, Japan's Nikkei ended up, as utilities and technology service providers led the gains.