Massacre continues at D-street for second continuous day

Bloodbath continued for second consecutive session at Dalal Street with both the frontline indices tumbling below their crucial 5,600 (Nifty) and 18,550 (Sensex) levels to hit the lowest level since November 21, 2012. Risk appetite turned sour on the back of heavy selling by exchange traded funds in the cash and futures market segment. Investors reacted negatively on data showing that foreign funds remained net sellers of Indian stocks on April 3, 2013. Foreign institutional investors (FIIs) sold shares worth a net Rs 368.39 crore on April 3.

Continued political uncertainty on the domestic front and worries about early elections after the withdrawal of a key regional ally from the ruling coalition last month mainly weighed on investors’ sentiment. Cautiousness also crept in after capital market regulator SEBI voiced concerns over an alarming rise in grey market investments with thousands of crore being raised through illegal means.

Global risk appetite also remained frail after weak economic reports on hiring and service industry growth in the US fuelled concerns over growth recovery in the world’s biggest economy. Meanwhile, European stocks were unchanged, following yesterday’s biggest drop in five weeks, as investors awaited an update on monetary policy from European Central Bank President Mario Draghi. Asian markets ended mixed as investors stayed sidelines watching the developments in the Korean Peninsula. Though, Nikkei 225 index showcased an exceptional session of performance, after the Bank of Japan said it would massively expand money supply to create inflation and lift the country out of its long economic malaise.

Back home, downfall continued as selling in software pack too dampened the sentiments as stocks like Infosys, TCS, Wipro and HCL Technologies edged lower on negative economic data in the US which is the biggest outsourcing market for the Indian IT firms. Banking stocks too butchered badly as Indian banks’ advances grew at a slower pace in 2012-13 compared with a year earlier, and fell short of the central bank’s projection, hurt by lower demand for credit from companies in a slowing economy.

Meanwhile, Adani Power shares declined over one and a half percent after gaining around 9 percent on April 3, 2013. Investors remained worried that State Electricity Boards may contest the CERC order awarding tariff compensation to the company. Bucking the trend sugar manufacturers viz. Bajaj Hindustan, Shree Renuka Sugars, Balrampur Chini Mills, Rana Sugar and Dhampur Sugar Mills edged higher on hopes that government will discuss the much-awaited measure to abolish the levy-sugar mechanism, under which private millers are required to sell a specified amount of the sweetener to the government at concessional rates.

The NSE’s 50-share broadly followed index Nifty declined by about one hundred points to end below the psychological 5,600 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex tumbled by about three hundred points, but managed to hold its crucial 18,500 mark. Moreover, broader markets too butchered badly and snapped the session with a cut of over 1-2 percent.

The overall volumes stood above Rs 1.64 lakh crore, which remained on the higher side as compared to that on Wednesday. The market breadth remained in favor of declines as there were 907 shares on the gaining side against 1,850 shares on the losing side while 111 shares remain unchanged.

Finally, the BSE Sensex shaved off 291.94 points or 1.55% to settle at 18,509.70, while the CNX Nifty plunged by 98.15 points or 1.73% to end at 5,574.75.

The BSE Sensex touched a high and a low of 18,733.62 and 18,473.85, respectively. The BSE Mid cap index down by 1.84% and Small cap index was down by 2.08%.

The only gainers on the Sensex were, Dr Reddys Lab up by 3.03%, Coal India up by 2.56%, Hindustan Unilever up by 1.68%, Maruti Suzuki up by 1.06% and Mahindra & Mahindra up by 0.26%, while Jindal Steel down by 4.32%, Tata Steel down by 3.97%, Sterlite Industries down by 3.09%, Infosys down 2.74% and Hero MotoCorp down by 2.67% were the top losers on the index.

There was no gainer on the BSE Sectoral space were, while Realty down by 3.39%, IT down 2.45%, TECk down 2.44%, Consumer Durables down 2.05% and Bankex down 1.89% were top losers on the sectoral space.

Meanwhile, Finance Minister P Chidambaram has projected a fiscal deficit of 5.2 percent in the revised estimates for 2012-13, which is now expected to be revised in light of better than expected revenue realization and savings. With this revised estimates, the government was hoping to collect Rs 4.69 lakh crore from customs, central excise and service tax.

As per the current estimates, the indirect tax collection for 2012-13 is expected to exceed the figures projected in the revised estimates, as the actuals are still being worked out. As far as the government expenditure is concerned, there will be a saving of Rs 10,000 crore over and above the revised estimate for 2012-13. The revised estimates had pegged total expenditure for the last fiscal at Rs 14.30 lakh crore.

Further, as per the fiscal road-map, the government is aiming to bring down the fiscal deficit to 4.8 percent in current fiscal and further to 3 percent of GDP by 2016-17. Fiscal deficit for 2012-13 is estimated at 5.2 percent, lower than the revised projection of 5.3 percent for the financial year.

The CNX Nifty touched a high and a low of 5,644.45 and 5,565.65 respectively. 

The top gainers on the Nifty were Dr Reddy’s up by 3.00%, Coal India up 2.70%, Hindustan Unilever up 1.82%, Maruti up 1.27% and Tata Motors up by 0.49%.

On the flip side, the top losers of the index were, Ultra Cement down by 6.45%, JP Associates down by 6.37%, Jindal Steel down by 5.12%, HCL Tech down by 4.49% and Reliance Infra down by 4.12%.

Most of the European markets were trading mixed, France’s CAC 40 up by 1.04%, the United Kingdom’s FTSE 100 up by 0.43% and Germany’s DAX down by 0.02%.

Asian equity markets ended mixed on Thursday after Japan announced more aggressive monetary easing, but other markets slipped, with Seoul hit by growing tensions on the Korean peninsula. Japan’s Nikkei ended with strong gains as the yen slipped more than 1% against the dollar. Seoul went home with red mark after North Korea blocked access to its Kaesong joint industrial zone with South Korea for the second day running.

Markets in mainland China, Hong Kong and Taiwan remained shut for the trade today.