Post session - Quick review

Indian equity markets, resumed trade post a day’s break on an abysmal note, as benchmark equity indices undergoing brutal torment concluded with loss of over 1/2 percent. Registering fifth consecutive session, feeble global cues this time around also clouded the scenario at D-street.  30 share barometer index, Sensex, on BSE, pummeling over century of points, finished sub 18500 level. Similarly, widely followed index, Nifty, too offloading over half a percent, ended below the psychological 5650 level. However, the trend was exceptional for Smallcap index, which went home with gains of over quarter percent. Meanwhile, Midcap index too suffered a blow of over 0.15%.

Acting indifferent to the decline in WPI inflation numbers, benchmark equity indices took a knock due to pessimistic global set-up. Data released by the government on Wednesday showed that the annual rate of inflation, based on monthly wholesale price index, easing at 8 month low, stood at 7.45% in October as compared to 7.81% for the previous month and 9.87% during the corresponding month of the previous year.

Sentiments also got a hit after much-talked about 2G mobile phone spectrum auction on Wednesday virtually flopped with just Rs 9,407 crore being garnered in the process contrary to the high valuation estimated by the CAG in its damning report of the government two years ago, which in turn poured cold water on the hopes of bettering the fiscal math and prevention of a downgrade by rating agencies.

On the global front, Asian stocks tumbled on Thursday as hopes began to fade for a quick agreement among U.S. leaders to avoid a 'fiscal cliff' that could derail the world's biggest economy. President Barack Obama is expected to meet Democratic and Republican congressional leaders on November 16, 2012 for talks to avoid $607 billion in tax increases and spending cuts that may spur a recession. Additionally, European shares extended losses on Thursday as the rising threat to global growth from the United States and Europe prompted investors to reduce their exposure to risky assets.

Closer home, software services exporters with significant business in the United States (US) were among the leading decliners. However, IT stocks also witnessed sharp profit-booking after the IT industry body NASSCOM lowered its growth expectation for the industry this financial year. NASSCOM now expects the export growth in dollar terms to be at the lower end of the 11-14% that it had forecast in February. Following the suite, were the stocks belonging from Metal and Fast Moving Consumer Goods (FMCG) counters. Further, in relief to state-run banks which need an infusion of additional capital , decision for the same will be taken in the next few weeks, Finance Minister P Chidambaram said on Thursday. Further, losses of the bourses also were curtailed after Finance Minister asked the RBI to start working on issuing final guidelines for granting licenses to new banks and receiving applications from the interested entities ‘in anticipation of Banking Regulation Act (BRA) being amended’. On the flip side, Realty, Consumer Durable and Power counters slugged, to emerge as the top gainers. Bourses losses, however, to some extent were also capped thanks to the gains of wireless services providers, namely Idea Cellular and Bharti Airtel, which enticed significant investor’s attention after an auction of 2G airwaves that attracted less demand than targeted by the government because prices are seen as too high. The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 1193:1629 while 102 scrips remained unchanged. (Provisional)

The BSE Sensex lost 164.22 points or 0.88% and settled at 18,454.65. The index touched a high and a low of 18,593.54 and 18,408.69 respectively. 9 stocks were seen advancing and 21 stocks were declining on the index (Provisional)

The BSE Mid-cap index was down by 0.24% while Small-cap index was up by 0.29%. (Provisional)

On the BSE Sectoral front, Realty up 1.76%, Consumer Durables up by 1.39% and Power up 0.10% were the only gainers, while IT down by 1.89%, Metal down by 1.58%, FMCG down by 1.26%, Health Care down by 0.93% and Auto down by 0.86% were the top losers in the space.

The top gainers on the Sensex were Bharti Airtel up 3.27%, BHEL up by 0.93%, HUL up 0.73%, Coal India up 0.59% and Maruti Suzuki up 0.52%, while, ITC down by 2.68%, Jindal Steel down by 2.50%, Tata Steel down by 2.33%, TCS down by 2.31% and Wipro down by 2.29% were the top losers in the index. (Provisional)

Meanwhile, after a dismal IIP numbers the inflation data has given some respite to the jittered investors as India’s WPI inflation rate in October declined. Lower than expected it rose to 7.45 percent in October 2012 (over October, 2011) as compared to 7.81 percent (Provisional) for the previous month and 9.87 percent during the corresponding month of the previous year. Build up inflation in the financial year so far was 4.78 percent compared to a buildup of 5.02 percent in the corresponding period of the previous year.

However, sharp upward revision in the August numbers overshadowed the lower-than-expected October figure. The August WPI inflation was revised to 8.01 percent from the provisional 7.55 percent. Now there are concerns being raised that the numbers of September and October too will be revised upward, as the underlying inflationary pressures remained firm despite decline in food inflation.

As per the government data, primary articles inflation stood at 8.21 percent down from 8.77 percent a month ago. The index for ‘Food Articles’ group declined by 0.1 percent to 212.5 (Provisional) from 212.7 (Provisional) for the previous month due to lower prices of bajra down by 6 percent, fish-marine down by 5 percent, urad down by 4 percent, arhar, gram, maize and poultry chicken down by 2 percent each and barley and condiments & spices down by 1% each percent. However, the prices of ragi moved up by 6 percent, fish-inland was up by 3 percent, moong, coffee and mutton increased by 2 percent each and tea, milk and rice was up by 1 percent each moved up.

The index for ‘Non-Food Articles’ group declined by 2.3 percent to 197.7 (Provisional) from 202.4 (Provisional) for the previous month due to lower prices of soyabean down by 22 percent, niger seed down by 9 percent, castor seed down by 8 percent, gingelly seed down by 6 percent, raw jute and raw cotton down by 5percent each, copra and raw silk down by 2 percent each.  However, the prices of gaur seed moved up by 8 percent, rape & mustard seed and flowers gained 6 percent each, coir fibre was up by 4 percent, sunflower higher by 3 percent, raw rubber and cotton seed moved up by 2 percent each and mesta, linseed, fodder too were up by 1 percent each.

Fuel & power group inflation in October was 11.71 percent against 11.88 percent a month ago. The index rose by 0.8 percent to 189.9 (Provisional) from 188.3 (Provisional) for the previous month. Inflation in manufactured products during the month was 5.95 percent, down from 6.26 percent. The index for this major group rose by 0.1 percent to 147.9 (Provisional) from 147.7 (Provisional) for the previous month.

India VIX, a gauge for markets short term expectation of volatility gained 4.15% at 15.53 from its previous close of 14.91 on Tuesday. (Provisional)

The S&P CNX Nifty lost 38.55 points or 0.68% to settle at 5,628.40. The index touched high and low of 5,651.65 and 5,603.55 respectively. 18 stocks advanced against 32 declining ones on the index. (Provisional)

The top gainers on the Nifty were Bharti Airtel was up 2.83%, Kotak Bank up 2.81%, DLF up 2.76%, IDFC up 1.67% and Cairn India was up 1.63%. On the other hand, Ultratech Cement down 3.49%, ITC down by 2.87%, Tata Steel down by 2.54%, Jindal Steel down by 2.46% and Grasim Industries down by 2.45% were the top losers. (Provisional)

The European markets were trading in red with, France’s CAC 40 down 0.31%, Germany’s DAX down 0.45% and the United Kingdom’s FTSE 100 down 0.44%.

Asian markets made a weak ending on Thursday and while the Japanese market was up by around 2% most of the Asian peers ended with cut of over a percent. Japanese Nikkei surged on speculation that a change of government may result in more stimulus for the economy. On the other hand Chinese Shanghai Composite declined by over a percent as Xi Jinping replaced Hu Jintao as head of the Chinese Communist Party. However, data showed a slowdown in China may be ending.

Jakarta Composite and KLSE Composite remained closed.