Post Session: Quick Review

Indian equity benchmarks ended with marginal gains on Monday’s trading session. After a strong start of the day, indices remained higher for the most part of the session, as FICCI's Overall Business Confidence Index has witnessed a decadal high of 74.2 in the current round on account of improvement in present conditions as well as expectations. Adding more optimism, the finance ministry said that the Indian economy is likely to do better than the projection of an 8 per cent shrinkage in the current fiscal as economic activity gathers pace with mild stiffening of pandemic curve and the rollout of vaccines.

During afternoon deals, markets were volatile, impacted with Chief Economic Advisor (CEA) Krishnamurthy Subramanian’s statement that the country’s financial sector has not really grown as fast as it should have and is still very, very small. For instance, he said, while India is the fifth largest economy in the world, the largest Indian financial institution - SBI - is ranked 55th in the world. Besides, the coronavirus cases in India jumped to 11,229,271 with 18,691 new infections reported across the country, according to Worldometer. The death toll meanwhile reached 157,890 with 99 fatalities in the last 24 hours.

Indices ended on flat note, as traders got cautious, after the RBI data showed that India Inc's overseas direct investment fell by 31 per cent to USD 1.85 billion in February this year. Domestic companies made investments of USD 2.66 billion in their overseas subsidiaries and joint-ventures in the year-ago month, February 2020. Upside remain capped as reversing the two-month buying streak, foreign portfolio investors (FPIs) pulled out Rs 5,156 crore from Indian markets in the first week of March amid profit booking and rising bond yields in the US. According to FPI statistics available with depositories, overseas investors pulled out a net Rs 881 crore from equities and Rs 4,275 crore from the debt segment between March 1-5, taking the total net withdrawals to Rs 5,156 crore.

On the global front, European markets were trading higher as UK business confidence hit a 12-month high on hopes of economic recovery. Asian markets ended mostly lower on Monday, after Japan posted a current account surplus of 646.8 billion yen in January, the Ministry of Finance said on Monday - down 2.3 percent on year. That missed forecasts for a surplus of 1,229.6 billion yen following the 1,165.6 billion yen surplus in December. The trade balance showed a deficit of 130.1 billion yen, down 86.9 percent on year after showing a surplus of 127.48 billion yen in the previous month.

The BSE Sensex ended at 50441.07, up by 35.75 points or 0.07% after trading in a range of 50318.26 and 50985.77. There were 13 stocks advancing against 16 stocks declining, while 1 stock remained unchanged on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.30%, while Small cap index was up by 0.63%. (Provisional)

The top gaining sectoral indices on the BSE were Capital Goods up by 1.76%, PSU up by 1.76%, Oil & Gas up by 1.62%, Industrials up by 1.19% and Metal up by 1.10%, while Realty down by 0.94%, FMCG down by 0.38%, Telecom down by 0.35%, Consumer Disc down by 0.17% and Auto down by 0.14% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Larsen & Toubro up by 3.43%, ONGC up by 2.96%, HCL Tech. up by 2.22%, NTPC up by 1.66% and Axis Bank up by 1.60%. On the flip side, Bajaj Finance down by 2.22%, Indusind Bank down by 2.05%, Ultratech Cement down by 1.81%, Bajaj Auto down by 1.40% and HDFC down by 1.31% were the top losers. (Provisional)

Meanwhile, credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has maintained a negative outlook on the power sector for FY22, on account of a further weakening in the financial position of distribution companies (discoms) due to COVID-19 led business disruptions.

As per the report, the power demand however has started improving post opening-up of the economy from September 2020 which is expected to lower the build-up of current dues by discoms in FY22. The rating agency expects the power demand to grow at 9%-10% yoy in FY22, and hence the thermal plant load factors would recover. However, the recovery to above 60% would be beyond FY23, given the continued thermal capacity additions of 6-8GW.

The report further noted that the share of renewable and nuclear power in the overall generation is expected to increase with planned capacity additions, further impacting the thermal plant load factors. The renewable capacity additions are also driven by growing priority of ESG (environmental, social and governance) investments among global investors.

The CNX Nifty ended at 14956.20, up by 18.10 points or 0.12% after trading in a range of 14919.90 and 15111.15. There were 26 stocks advancing against 24 stocks declining on the index. (Provisional)

The top gainers on Nifty were UPL up by 6.49%, GAIL India up by 4.76%, Larsen & Toubro up by 3.53%, ONGC up by 2.87% and SBI Life Insurance up by 2.25%. On the flip side, Shree Cement down by 2.38%, Bajaj Finance down by 2.28%, Ultratech Cement down by 2.09%, Indusind Bank down by 2.08% and Bajaj Auto down by 1.40% were the top losers. (Provisional)

European markets were trading higher, UK’s FTSE 100 increased 20.88 points or 0.31% to 6,651.40, France’s CAC increased 23.02 points or 0.4% to 5,805.67 and Germany’s DAX was up by 71.70 points or 0.52% to 13,992.39.

Asian markets ended mostly lower on Monday as rising bond yields globally sparked fears that central banks would tighten policy sooner than expected. Japanese shares ended down as some investors are trying to adjust their positions ahead of the end of the fiscal year, and by concerns that the passage of a $1.9 trillion US Covid-19 relief package could cause inflation to soar. Chinese shares declined despite strong trade data from China that raised hopes for a quicker economic recovery, while ominous comments from China’s foreign minister about the self-ruled island of Taiwan put pressure on market sentiment.