Post session - Quick review

It turned out to be a disappointing session of trade for Indian equity markets, which gradually losing steam, slid towards day’s low, to shut shop with loss of close to half a percent that led to Sensex and Nifty ending sub psychological 19700 and 6000 mark respectively. Sustained profit-booking by market participants amidst tepid global cues, mainly led to somber run of benchmark equity indices, which after getting a flat to cautious start, went on losing ground systematically to conclude near day’s low point, registering its first negative close for New Calendar Year 2013.

Intense selling pressure in stocks belonging from Capital Goods (CG), Consumer Durables (CD), Fast Moving Consumer Goods (FMCG), Realty and Bankex counters, mainly pressurized the sentiment at D-street. However, select buying in Metal, HealthCare, Auto and Oil & Gas counters to some extent curbed the losses of frontline equity indices.

On the global front, both Asian and European edged lower in red on Monday as investors booked profits from a New Year rally that had pushed markets to multi-month highs, but financial stocks, which  gained after global regulators decided to relax draft plans for tough new bank liquidity rules, to some extent limited the losses. On Sunday, the Basel Committee of banking supervisors said they will give banks four additional years and more flexibility to build up cash buffers, allowing lenders to put some of their reserves to work, which should boost economic growth.

Closer home, investors, after witnessing the four consecutive session’s splendid rally, lacked the conviction right from the start of the trade, as benchmark equity indices after getting a cautious start though managed to gain some traction, but soon lost as investor’s started pocketing their profits from a New Year rally. Nevertheless, upstream oil and gas companies put up an interesting show on hopes that a pricing formula recommended by a government-appointed panel will help sharply raise the prices of domestic natural gas. Oil and Natural Gas Corporation (ONGC) and Cairn India had rallied close to 2%. Meanwhile, shares of other PSU OMCs, namely, BPCL, HPCL and IOCL rallied on reports the government has formally started the consultation process for raising diesel prices. Additionally, even Telecom stocks, i.e. Tata Teleservices and Reliance Communications rang loud on EGOM’s recommendation for up to 50% cut in CDMA base price. Furthermore, steel stocks saw strong gains after the government notified a 20 per cent import duty on Chinese Hot Rolled Flat Steel. State-run SAIL shares and JSW Ispat jumped nearly 4 per cent. JSW Steel shares too surged 4.5 per cent. The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1524:1391 while 151 scrips remained unchanged. (Provisional)

The BSE Sensex lost 126.07 points or 0.64% and settled at 19784.08. The index touched a high and a low of 19856.43 and 19654.46 respectively. 11 stocks were seen advancing while 19 stocks were declining on the index (Provisional)

The BSE Mid cap and Small cap indices rose 0.12% and 0.52% respectively. (Provisional)

On the BSE Sectoral front, Metal was up by 0.51%, Health Care up by 0.42%, Auto up by 0.29%, Oil & Gas up by 0.10% and IT up by 0.08% were the top gainers, while Capital Goods down by 1.71%, Realty down by 1.44%, FMCG down by 1.23%, Consumer Durables down by 1.20% and Bankex down by 0.70% were the top losers in the space.

The top gainers on the Sensex were Maruti Suzuki up by 2.53%, Cipla up by 1.96%, Sun Pharma up by 1.25%, Tata Steel up by 1.08% and Infosys up 1.02%, while, L&T down by 2.60%, HDFC down by 2.01%, Hindustan Unilever down by 1.85%, HDFC Bank down by 1.70% and BHEL down by 1.38% were the top losers in the index. (Provisional)

Meanwhile, after the passage of the Banking Amendment Bill, the Reserve Bank of India (RBI) is expected to float final guidelines for the grant of banking licence’s to new players within the next four-six weeks. The RBI is keen to finalize new banking norms before the retirement of deputy governor Anand Sinha, who is in charge of the department of Banking Operations and Development at the central bank.

Further towards this development, most of the banking aspirants, including Anil Ambani-led Reliance Group, financial conglomerates Religare and Shriram groups, engineering-to-technology major L&T group and Aditya Birla group, have begun doing the groundwork. While, quite a few large corporate houses are even confident of meeting the regulatory framework despite some voices being raised in certain quarters about concerns of possible conflict of interest in case of industrial houses being given banking permits as it has the potential to create conflict of interests.

Meanwhile, the finance ministry is also currently in the process of sending its final comments to the RBI on the draft guidelines issued by the central bank on the matter, after which the final guidelines should be made public. The RBI is already in the process of gathering the comments received from various stakeholders on the draft guidelines.

India VIX, a gauge for markets short term expectation of volatility gained 4.11% at 13.92 from its previous close of 13.47 on Wednesday. (Provisional)

The S&P CNX Nifty lost 37.85 points or 0.63% to settle at 5,978.30. The index touched high and low of 6,042.15 and 5,977.15 respectively. 14 stocks advanced against 36 declining on the index. (Provisional)

The top gainers on the Nifty were BPCL was up by 3.26%, Maruti Suzuki was up by 2.49%, Cipla was up by 2.05%, Cairn was up by 1.59% and Sun Pharma was up by 1.48%. On the other hand, L&T down by 2.58%, JP Associate down by 2.57%, Hindustan Unilever down by 2.57%, HDFC down by 2.11% and HDFC Bank down by 1.67% were the top losers. (Provisional)

Most of European markets were trading in red, France’s CAC 40 down by 0.57% and Germany’s DAX down by 0.49%. On the other hand, the United Kingdom’s FTSE 100 up by 0.46% was the sole loser in space.

Asian markets ended mostly lower on Monday as investors booked profits after New Year’s rally, which had pushed markets to multi-month highs, despite of data showing that the U.S. economy continuing on a path of slow but steady recovery. Hong Kong closed flat, as investors were affirmative about upcoming data, including inflation and trade figures, due out of Beijing soon. Japan’s Nikkei went home with red mark, as it remained under pressure on expectations that the Japanese central bank will further loosen monetary policy.