Global worries once again pull markets lower on Friday

Pressurized by feeble global cues, key domestic benchmarks once again ended the volatile day of trade in red terrain extending their losing streak for the sixth consecutive session. The benchmarks got off to a flat but positive opening, shrugging the somber sentiments prevailing in Asian markets. However, the indices slipped into the negative territory and even went on to test important psychological 18,700 (Sensex) and 5,650 (Nifty) levels. The key gauges got solid support around those intraday low levels as they convalesced from thereon. The indices tried hard to move back into the positive territory and even got there but only for a brief period as investors took the opportunity to cash in on the bounce back. The bourses finally extended the declining run for the sixth session but finished way above intraday lows.

The investors mainly resorted to profit booking due to feeble global cues as most of the Asian counters shut shop in the negative terrain on fears that Cyprus may default on its debt, while deteriorating euro zone economic activity further underscored the troubles ailing the region. Sluggish trade in European markets in early trade too dampened the sentiments. Key European indices were on track for their worst weekly drop since November, as worries over Cyprus’ bailout problems dented sentiment.

Back home, some revival was seen in late hour of trade where the frontline counters paring all their intraday losses turned into the green terrain but, the recovery proved short lived as local bourses once again dipped into red. Continuing worries over the country’s political stability dampened the trading sentiment while, drubbing in blue chip stocks, viz. SBI and ICICI Bank on doubts over the prospects of future rate cuts also soured sentiment at D-Street. Some pressure also came in after, fertilizer stocks like National Fertilizers, Nagarjuna Fertilizers, Rashtriya Chemicals and Fertilisers, Chambal Fertilisers, Gujarat State Fertilisers and Coromandel International went through the floor as subsidy payment worth Rs 31,580 crore is likely to remain outstanding to the manufacturers this fiscal.

Bucking the trend, two-wheeler firms Bajaj Auto and Hero MotoCorp were among the top Sensex gainers up 2-4 percent each. Hero MotoCorp was up on media reports that the company plans to spend nearly Rs 1,100 crore on capital expenditure and has formulated a strategy to take on its rivals.

The NSE’s 50-share broadly followed index Nifty declined by just seven points and managed to end a tad above the psychological 5,650 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex dropped by fifty points but, managed to hold the psychological 18,700 mark. Moreover, broader markets too struggled through the day to end with a cut of over half a per cent. The market breadth remained in favor of declines as there were 984 shares on the gaining side against 1,882 shares on the losing side while 111 shares remain unchanged.

Finally, the BSE Sensex lost 57.27 points or 0.30% to settle at 18,735.60, while the CNX Nifty declined by 7.40 points or 0.13% to end at 5,651.35.

The BSE Sensex touched a high and a low of 18,859.82 and 18,669.20, respectively. The BSE Mid cap index down by 0.26% and Small cap index was down by 0.96%.

The top gainers on the Sensex were, Bajaj Auto up by 3.85%, Jindal Steel up 3.11%, Hindalco up 1.64%, Hero MotoCorp up 1.52% and Tata Power up 1.43%, while SBI down by 1.71%, Tata Steel down by 1.68%, Sun Pharma down by 1.42%, Bharti Airtel down 1.28% and TCS down by 1.27% were the top losers on the index.

The top gainers on the BSE sectoral front were, Power up 0.27%, Metal up 0.15%, Capital Goods up 0.12% and Auto up 0.35 points, while Consumer Durables down by 2.06%, Realty down 1.31%, IT down 0.82%, TECk down 0.70% and Health Care down 0.54% were the top losers on the sectoral space.

Meanwhile, in a big setback to road ministry, the planning commission and finance ministry have stalled the road ministry's proposal, which was aimed at easing the financing woes of road developers.  The highways ministry has sought the Cabinet Committee on Investment's (CCI) nod to allow infrastructure developers to sell their entire stake in completed highway project, which will help them to bring in fresh equity into projects that have been under pressure to achieve financial closure.   

Currently, road projects allotted after 2009 can offload 74% of their stake only after two years of commercial operations, while projects awarded before that can sell 67% stake three years after commercial operations begin. The ministry also wants to dispose of these lock-in periods. 

As per the road ministry, the funding crunch in the sector has dampened progress on new projects and there are about 36 projects facing financial closure issues. The government has set the ambitious 8800 km road project target for this financial year, while, the road ministry has achieved only one-tenth of it. Earlier, the roads ministry has sent multiple suggestions to the finance ministry on ways to ease the fund crunch in the sector.

The CNX Nifty touched a high and a low of 5,691.45 and 5,631.80 respectively. 

The top gainers on the Nifty were, IDFC up by 6.19%, Ambuja Cement up 4.20%, Bajaj Auto up 3.97%, Bank of Baroda up 3.70% and Jindal Steel up by 3.34%.

On the flip side, the top losers of the index were, DLF down by 3.17%, Ranbaxy down by 1.99%, SBI down by 1.86%, Tata Steel down by 1.78% and TCS down by 1.66%.

The European markets were trading in red, France’s CAC 40 down by 0.35%, Germany’s DAX down by 0.13% and the United Kingdom’s FTSE 100 down by 0.02%.

Asian equity markets ended mostly lower after hovering near 2013 lows as Cyprus clambered to encounter a solution to its funding crisis and worries over the health of the euro zone increased. Bucking the trend, the Shanghai Composite Index went home with green mark after swinging between gains and losses. Japan’s Nikkei closed lower with the stronger yen after the new Bank of Japan governor played down the chances of an emergency meeting. Hong Kong market ended in negative territory, on gloomy picture of corporate earnings.