Post session - Quick review

Squandering a positive start, Indian equity markets losing all the steam settled near day’s lowest point on Monday. Fierce selling pressure, witnessed in the wee hours of the trade, dragged the benchmark equity indices below their neutral line, which otherwise for the most part of the day held their fort in green terrain. Only, Auto counter, showcasing resilience, emerged as the sole gainer amongst the BSE Sectoral indices. In the lackluster session, of trade, 30 share barometer index, Sensex and widely followed 50 share index, Nifty, both ended sub the psychological 19800 and 6000 levels respectively. However, the session turned out to be worst for broader indices, which concluded with a cut of over half a percent.

Disappointing Q3 earning of India's second largest public sector lender, Bank of Baroda coupled with the heavy drubbing of index heavyweight BHEL, mainly dampened the sentiment at D-street. Hurt by higher provisioning for bad assets, Bank of Baroda's net profit for Q3FY13 declined by 21.58% at Rs 1011.62 crore as against Rs 1289.85 crore for the quarter ended December 31, 2011. The rub off effect of this scrip, was also felt across other PSU Bank stocks, namely, SBI, Punjab National Bank, etc, which ended with a cut of over a percentage. Nevertheless, buoyant earnings of ICICI bank kept private sector bank stocks in fine contour.

India’s biggest power utility manufacturer BHEL shares tumbled after the company for the first time in a decade reported a decline in net sales, prompting analysts to put a sell recommendation to their clients. The company registered a fall of 17.50% in its net profit at Rs 1181.85 crore in Q3FY13 as compared to Rs 1432.61 crore in the corresponding quarter previous year. The total income of the company has decreased by 3.18% to Rs 10,552.09 crore for the quarter under review as compared to Rs 10,898.51 crore in the same quarter last year.

On the global front, Asian pacific shares climbed to 18-month highs on Monday after the US data showed some promise of a credible recovery, while momentum also gained on firmer manufacturing data from Europe and China. U.S. employment grew modestly in January and job gains in the previous two months were larger than first reported, while factory activity hit a nine-month high in January, data released on Friday showed. Moreover, European stocks were trading in red as investors remained cautious ahead of a meeting between Spanish and German leaders later in the day.

Closer home, barring Auto, all the 12 sectoral indices ended the trade in red terrain. Amongst the worst performers were the stocks of PSU, HealthCare and Power index. Oil refiners, viz, HPCL, and Indian Oil Corporation (IOC), which too held up in early trade on expectations of a diesel price hike announcement as early as this week after the government last month allowed companies to raise prices, ended deep in red with a loss of over a percent. Additionally, IT stocks too tanked after reports suggested of US Government objecting to India's plans of making it compulsory for Government agencies to source electronic products, including personal computers, printers and tablets.

Among individual stocks, Jubilant FoodWorks has slipped over 5% after reporting a lower-than-expected 28% year-on-year rise in net profit at Rs 37.70 crore for the quarter ended on December 31, 2012 due higher expenditure and tax outgo. On the flip side, J&K Bank gained after good Q3 results. Jammu and Kashmir Bank’s) third quarter net profit rose by 35.75% year-on-year to Rs 289.40 crore, sending shares nearly 1 percent higher. Meanwhile, Tata Motors and UltraTech Cement advanced over 1.5% after briefly plunging as much as 10 percent each on Friday, on account of a technology trading glitch from brokerage Religare Capital Markets. The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 1022:1331 while 648 scrips remained unchanged. (Provisional)

The BSE Sensex lost 44.52 points or 0.23% and settled at 19736.67. The index touched a high and a low of 19902.60 and 19728.21 respectively. 10 stocks were seen advancing while 19 stocks were declining and one stock remain unchanged on the index (Provisional)

The BSE Mid cap and Small cap indices decline 0.84% and 0.69% respectively. (Provisional)

On the BSE Sectoral front, PSU down by 1.65%, Health Care down by 1.49%,  Power down by 1.40%, Metal down by 1.26% and Capital Goods down by 0.93% were the top losers while, Auto up by 0.45% was the sole gainer in the space.

The top gainers on the Sensex were HDFC up by 2.37%, Tata Motors up by 2.11%, Hindustan Unilever up by 0.60%, ICICI Bank up by 0.57% and Jindal Steel up by 0.56%. On the flip side, BHEL down by 2.93%, SBI down by 2.49%, Cipla down by 2.45%, Tata Power down by 2.39% and ONGC down by 2.12% were the top losers on the Sensex. (Provisional)

Meanwhile, to bring down inflation on a sustained basis, the Reserve Bank (RBI) has expressed the need of policy interventions on several fronts. RBI executive director Deepak Mohanty said 'it is important to aim for nutritional security not only to harness the demographic dividend stemming from our sizable young population but also to contain food prices. This will require addressing the supply-demand imbalance in the agricultural sector and modernising the supply chain.'

While, wholesale Price Index (WPI) based inflation declined to 7.18% in December from 7.74% over the same period a year ago. But still it is much above the comfort level of RBI. The apex bank’s technical assessment has also suggested that the threshold level of inflation for India is in the range of 4 to 6% and if inflation persists beyond this level, then it could lower economic growth over the medium-term.   RBI executive director stressed the need of depth financial markets as well as calibrating monetary policy with growth-inflation dynamics. He said that to ensure industrial capacity utilisation and productivity improvement India needs to have a reliable power supply as well as availability of industrial raw materials, which will reduce reliance on imports of products for which domestic capacity exists and will moderate inflation. By adding further he said that maintaining the exchange rate stability is important to cushion transmission of international price pressures in commodities, particularly crude oil. 'This will require management of the current account in our balance of payments with the rest of the world at sustainable levels'.  

India VIX, a gauge for markets short term expectation of volatility gained 4.21% at 14.34 from its previous close of 13.76 on Friday. (Provisional)

The S&P CNX Nifty lost 11.90 points or 0.20% to settle at 5,987.00. The index touched high and low of 6,038.50 and 5,981.25 respectively. 16 stocks advanced against 34 declining on the index. (Provisional)

The top gainers on the Nifty were Tata Motors was up by 3.50%, UltraTech Cement was up by 3.38%, HDFC was up by 2.68%, Asian Paints was up by 2.59% and DLF was up by 1.90%. On the other hand, Bank of Baroda down by 7.72%, IDFC down by 5.36%, JP Associate down by 4.74%, Ranbaxy down by 3.63% and BHEL down by 2.96% were the top losers. (Provisional)

Most of European markets were trading in red, France’s CAC 40 down by 0.20%, Germany’s DAX down by 0.13% and the United Kingdom’s FTSE 100 down by 0.31%

Asian markets ended mostly higher Monday as positive economic data from U.S. supported markets, raising the expectations that the Federal Reserve will maintain its ultra-easy monetary policy for the foreseeable future. China's Shanghai Composite closed the shutter on positive note, helped by upbeat service-sector data. Japan’s Nikkei went home with green mark, reacting to the 1.2% gain that the dollar made against the yen on Friday, pushing the market to a new 33-month high. However, South Korea's Kospi Composite closed lower as local automakers retreated as the yen continued to weaken, benefitting their Japanese rivals.