Markets end March F&O series in style

Thursday turned out to be a tremendous day of trade for Indian equity markets as both the frontline indices, after trading choppy for most part of the session, changed their gear in late trade to re-claim psychological 18,800 (Sensex) and 5,650 (Nifty) levels. Earlier, the domestic markets made a lackluster start tailing sluggish global cues as weak euro zone data, a sluggish debt auction in Italy and fears of a potential run on Cyprus banks stoked investors concerns about instability in Europe. But, buying which emerged in last leg of trade helped key gauges to end the last day of Futures & Options expiry of March month in a great style after investors scooped up on battered blue chip stocks amidst hopes of strong fund inflow by corporate before the financial year end and strong corporate earnings in the upcoming quarter, which gave the Indian equity markets required boost.

Global risk appetite also improved after Germany’s retail sales advanced countering concern over Europe’s debt crisis. European shares edged higher in early deals on Thursday, recovering from a three-week low hit in the previous session as bargain hunters picked up beaten-down stocks on the last trading day of the quarter. However, worries over the impact of a bailout of Cyprus capped the gains. Meanwhile, some recovery was also seen in Asian counters as after a sluggish trade for most part of the session, some of the counters shut shop in green terrain.

Back home, some boost to the local bourses came in from buying in software and technology stocks as scrips like Infosys, TCS, Wipro and HCL Technologies gained on hopes of good fourth quarter results. Buying in metal and banking counters too supported the sentiments. However, the upside remain capped as traders remained sideways ahead of the Current Account Deficit (CAD) numbers, slated to be announced later in the day by the central bank for the three months ended December 31. Prime Minister’s Economic Advisory Council (PMEAC) Chairman C Rangarajan had said that third quarter CAD will be higher but it could come down in the fourth quarter. Meanwhile, for the first 11 months of the current financial year, the Centre’s fiscal deficit touched 97.4 percent of revised estimate (RE) for 2012-13. In absolute terms, the fiscal deficit stood at Rs 5.07 lakh crore against Rs 5.21 lakh crore estimated in the RE. Additionally, Auto remained the lone loser, declining by three fourth of a percent as auto companies will start unveiling monthly sales volume data for March 2013 from April 1, 2013.

The NSE’s 50-share broadly followed index Nifty rose by over forty points to end above the psychological 5,650 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex surged by over one hundred and thirty points to finish above the psychological 18,800 mark. Moreover, broader markets too traded superbly during the session and garnered a gain of over one percent.

The market breadth remained in favor of advances as there were 1,627 shares on the gaining side against 1,148 shares on the losing side while 122 shares remain unchanged.

Finally, the BSE Sensex gained 131.24 points or 0.70% to settle at 18,835.77, while the CNX Nifty rose by 40.95 points or 0.73% to end at 5,682.55.

The BSE Sensex touched a high and a low of 18,882.54 and 18,568.43, respectively. The BSE Mid cap index was up by 1.46%, while the Small cap index up 1.32%.

The top gainers on the Sensex were, Gail India up by 5.02%, Hindalco up 3.98%, ONGC up 2.92%, Sterlite up 2.91% and HDFC Bank up 2.70%, while Tata Motors down by 2.16%, Hero MotoCorp down by 1.95%, Bharti Airtel down by 1.77%, Jindal Steel down 1.35% and Hindustan Unilever down by 1.34% were the top losers on the index.

The top gainers on the BSE sectoral front were, Metal up 2.69%, Capital Goods up 2.17%, Consumer Durables up 1.89%, PSU down 1.76% and Bankex up 1.66%, while Auto down 0.76% was the only loser on the sectoral space.

Meanwhile, real estate developers are likely to move the finance ministry against a proposed tax on property sales, as they feel that the prevailing economic slowdown is impacting the sector’s growth. The government has proposed a new Section 43CA in the I-T Act, in which the developers have to pay the tax on the basis of assessed valuation of a property at the time of transfer, instead of levying tax on the basis of sale price, fixed when the project was initiated.

As per the new Section 43CA in the I-T Act, if the consideration for the transfer of an asset (other than capital asset), being land or building or both, is less than the stamp duty value, the value so adopted or assessed or assessable shall be deemed to be the full value of the consideration for the purposes of computing income under the head profits and gains of business or profession.

The real estate developers are of the view that the proposed tax is presumptive and questioned the constitutional validity. The government’s recent move may put buyers in a spot and reduce property sale in a slowing economy, which may impact the government's plan to revive the real estate sector that is linked to a number of industries like steel and cement and create jobs for thousands of construction workers.

Meanwhile, housing prices in India have been escalating over the period of time. Pursuant to which the government planned to raise additional resources by way of this move. The new tax will come into effect from April 1, 2014.

The CNX Nifty touched a high and a low of 5,692.95 and 5,604.85 respectively. 

The top gainers on the Nifty were, Siemens up by 4.30%, GAIL up 4.03%, Hindalco up 3.80%, HCL Tech up 3.17% and Ambuja Cement up by 3.11%.

On the flip side, the top losers of the index were, Tata Motors down by 2.32%, Hero MotoCorp down by 1.96%, Bharti Airtel down by 1.67%, Maruti down by 1.41% and Bajaj Auto down by 1.33%.

The European markets were trading in green, France’s CAC 40 up by 0.34%, Germany’s DAX up by 0.32% and the United Kingdom’s FTSE 100 up by 0.37%.

Asian markets ended mostly lower on Thursday, ahead of the scheduled re-opening of Cypriot banks amid increasing worries about the euro-zone financial situation. Japan’s Nikkei plunged sharply as yen's rise against the US dollar pressurized the market. Chinese market went home with red mark, hurting Hong Kong markets, weighted down by banks after they were ordered to tighten control over wealth management products (WMP) and improve transparency. Meanwhile, investors traded cautiously as Italy's politicians were still unable to form a government weeks after an election.