Benchmarks end lower on Monday

Indian equity benchmarks ended lower on Monday, tracking weak cues from global markets as investors continued to assess the impact of new Western sanctions on Russia and the Fed's plans to shrink its balance sheet. Benchmarks made negative start and stayed in red for whole day, as investors awaited the onset of the corporate earnings season with Tata Consultancy Services (TCS) due to report its financial results for the March quarter after market hours today. Traders were concerned as the Reserve Bank data showed that in the steepest weekly fall ever, India's forex reserves slid by $11.173 billion to $606.475 billion as the currency came under pressure due to geopolitical developments. Some anxiety also came as Revenue Secretary Tarun Bajaj warned that FY23 was unlikely to see a rate of growth in tax collections similar to that in FY22.

Weakness persisted in markets in afternoon trade amid a private report stating that India's retail inflation likely sped up to a 16-month high of 6.35% in March, well above the Reserve Bank of India's upper tolerance band for a third straight month, in part due to a sustained rise in food prices. Sentiments remained down-beat after exchange data showed foreign institutional investors (FIIs) were net sellers in the capital market on Friday, as they offloaded shares worth Rs 575.04 crore. Adding more worries, the US government said that India’s proposed data localisation requirements under which firms need to store data within India “will serve as significant barriers to digital trade” between the two countries. Traders overlooked the Commerce and Industry Ministry stated that India's agricultural exports rose by about 20 per cent to $50.21 billion during 2021-22 despite logistical challenges posed by the COVID-19 pandemic. Market participants also failed to take any sense of relief as preliminary data of the commerce ministry showed that India’s exports grew by 37.57 per cent to $9.32 billion during April 1-7. 

On the global front, Asian markets settled lower on Monday as battle loomed in Ukraine's east and the Shanghai coronavirus outbreak worsened. With Chinese inflation figures painting a mixed picture of the economy, investors looked ahead to the ECB policy meeting and the release of U.S. inflation data this week for additional clues about the rate outlook. European markets were trading mostly in red as battle loomed in Ukraine's east and the Shanghai coronavirus outbreak worsened. With Chinese inflation figures painting a mixed picture of the economy, investors looked ahead to the ECB policy meeting and the release of U.S. inflation data this week for additional clues about the rate outlook. Back home, media and entertainment industry stocks were in focus as a report by the CII showed that the media and entertainment industry in South India is growing at a compound annual growth rate (CAGR) of 15% making a post-crisis comeback. Power stocks too were in watch as total outstanding dues owed by electricity distribution companies (discoms) to power producers increased by 17.3 per cent year-on-year to Rs 1,23,244 crore in April 2022. According to portal PRAAPTI (Payment Ratification And Analysis in Power procurement for bringing Transparency in Invoicing of generators), discoms owed a total of Rs 1,05,029 crore to power generation firms in April 2021.

Finally, the BSE Sensex fell 482.61 points or 0.81% to 58,964.57 and the CNX Nifty was down by 109.40 points or 0.62% to 17,674.95.       

The BSE Sensex touched high and low of 59,355.76 and 58,894.40, respectively. There were 7 stocks advancing against 23 stocks declining on the index.   

The broader indices ended in green; the BSE Mid cap index rose 0.41%, while Small cap index was up by 0.38%.

The top gaining sectoral indices on the BSE were Power up by 5.18%, Utilities up by 5.09%, Oil & Gas up by 2.38%, Energy up by 1.73% and Realty up by 1.07%, while IT down by 1.46%, TECK down by 1.37%, Capital Goods down by 1.09%, Telecom down by 0.60%, Finance down by 0.49% were the losing indices on BSE.

The top gainers on the Sensex were ICICI Bank up by 0.71%, NTPC up by 0.69%, TCS up by 0.26%, Ultratech Cement up by 0.16% and Nestle up by 0.10%. On the flip side, HCL Technologies down by 2.73%, Larsen & Toubro down by 2.72%, Infosys down by 2.67%, Wipro down by 2.16% and Asian Paints down by 1.54% were the top losers.

Meanwhile, Reserve Bank of India (RBI) in its latest survey report has stated that the household inflation expectation and consumer confidence rose in March. The survey was conducted during March 2 to 11, 2022 in 19 major cities. As per the survey report, households’ median inflation perception for the current period remained unchanged at 9.7 per cent in the latest survey round, while the expectations for both three months and one-year ahead rose by 10 basis points each to 10.7 per cent and 10.8 per cent, respectively, compared to January 2022 round.

The RBI said ‘for a majority of population and age groups, uncertainty in inflation expectations increased for both three-month and one-year horizons, as compared to the previous survey round’. Three months ahead of expectations for overall prices and inflation were generally aligned to those for food and non-food products, while one-year ahead expectations were more aligned to those for non-food products and services.

The report also stated that consumer confidence for the current period continued on its recovery path. The current situation index (CSI) improved further in March 2022 on the back of improved sentiments on general economic situation, employment and household income. Households’ opinion about current and future spending remained in positive territory and was bolstered by a rise in both essential and discretionary spending.

The CNX Nifty traded in a range of 17,779.05 and 17,650.95. There were 21 stocks advancing against 29 stocks declining on the index.     

The top gainers on Nifty were Grasim Industries up by 2.58%, Adani Ports &SEZ up by 1.81%, Cipla up by 1.55%, Apollo Hospitals Enterprise up by 1.39%, Cipla up by 1.37% and JSW Steel up by 1.24%. On the flip side, HCL Technologies down by 2.65%, Larsen & Toubro down by 2.64%, Infosys down by 2.47%, Wipro down by 2.09% and SBI Life Insurance down by 1.75% were the top losers.

European markets were trading mostly in red; UK’s FTSE 100 decreased 14.11 points or 0.18% to 7,655.45 and Germany’s DAX decreased 56.97 points or 0.4% to 14,226.70, while France’s CAC increased 46.94 points or 0.72% to 6,595.16.

Asian markets settled lower on Monday as concerns about ongoing war in Ukraine and the extended lockdown in Shanghai due to the worsening coronavirus outbreak weighed on market sentiments. Meanwhile, investors are looked ahead to the ECB policy meeting and the release of US inflation data for additional clues about the interest rate outlook. Chinese shares declined as the country grapples with the Covid-19 outbreak, while the fast pace of China's factory-gate and consumer prices also weighed on risk appetite. Data showed that China's producer price index increased 8.3% year-on-year, easing from 8.8% growth in February. While, the consumer price index inched up 1.5% year-on-year, the fastest pace in three months. Further, Japanese stocks fell after Japan Prime Minister Fumio Kishida announced a ban on Russia coal imports, a move that could accelerate the transition to renewable energy and the restarting of nuclear plants.