Benchmarks continue southward journey for third straight session

Key domestic benchmarks continued their southward movement for third straight day with both the frontline indices ending the volatile day of trade slightly in red as concern about foreign funds selling continued to weigh after overseas investors sold shares worth net Rs 326 crore on April 4, 2013 and Rs 368 crore on April 3, 2013. Earlier, markets made a sluggish start with local markets hitting 26-week low as political uncertainty at the domestic front, slowing growth in China, US unemployment claims and the European Central Bank keeping interest rates unchanged remained the major reasons for the downfall. However, some buying was seen at lower levels that helped the markets to recover from the lows of the day in the final hour but it was not enough to bring markets back into the positive trajectory and Sensex ended the session below its crucial 18,500 mark while, Nifty managed to hold its psychological 5,550 bastion.

Global cues too remained sluggish as European counters traded in the red in early deals as investors cautiously stayed on the sidelines ahead of the closely watched US nonfarm-payroll report. Asian markets too shut shop mostly in red as investors remain worried after North Korea blocked access to its Kaesong joint industrial zone with South Korea for the second day running. However, Japanese Nikkei managed to end the session in the green buoyed by the Bank of Japan’s announcement of massive stimulus to revive the world’s third-largest economy.

Back home, there was buzz in the NBFC applicants of the new banking licenses on a report that RBI has received 30 applications from different entities for opening new banks. On the other hand, there was selling in private banking stocks on reports that in RBI’s investigation, though there was no case of money laundering, but there were proofs of KYC lapse and banks could face a regulatory penalty for that. Selling in banking stocks too dampened the sentiments as Indian banks’ advances grew at a slower pace in 2012-13 compared with a year earlier, falling short of the central bank’s projection, hurt by lower demand for credit from companies in a slowing economy.

However, losses remain capped as sentiments got some support after sugar manufacturers viz. Bajaj Hindustan, Shree Renuka Sugars, Balrampur Chini Mills, Rana Sugar and Dhampur Sugar Mills edged higher after the government on April 4 partially decontrolled the Rs 80,000-crore sugar sector by giving freedom to millers to sell in the open market and removed their obligation to supply the sweetener at subsidised rates to ration shops.

The NSE’s 50-share broadly followed index Nifty declined by over twenty points but managed to hold the psychological 5,550 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex tumbled by about sixty points to end below its crucial 18,500 mark. However, broader markets too struggled during the session and ended the trade mixed.

The overall volumes stood above Rs 1.46 lakh crore, which remained on the lower side as compared to that on Thursday. The market breadth remained in favor of advances as there were 1,420 shares on the gaining side against 1,306 shares on the losing side while 139 shares remain unchanged.

Finally, the BSE Sensex lost 59.47 points or 0.32% to settle at 18,450.23, while the CNX Nifty declined by 21.50 points or 0.39% to end at 5,553.25.

The BSE Sensex touched a high and a low of 18,525.45 and 18,389.29, respectively. The BSE Mid cap index up by 0.02% and Small cap index was down by 0.15%.

The only gainers on the Sensex were, Maruti Suzuki up by 7.23%, ONGC up by 2.20%, Wipro up by 2.17%, Reliance up by 1.77% and Sterlite Industries up by 1.77%, while HDFC down by 2.84%, ITC down by 2.79%, NTPC down by 2.42%, Bharti Airtel down 1.13% and ICICI Bank down by 1.11% were the top losers on the index.

The top gainers on the BSE Sectoral space were Oil & Gas up 1.65%, Auto up 0.55%, Metal up 0.31%, PSU up 0.14% and Health Care up 0.06%, while FMCG down by 1.74%, Consumer Durables down 0.78%, Capital Goods down 0.72%, Power down 0.56% and Bankex down 0.36% were top losers on the sectoral space.

Meanwhile, the Direct Benefit Transfer (DBT) scheme is likely to be implemented in 78 more districts in the next phase beginning July 1, as per the Prime Minister’s Office statement. The plan would contain three pension schemes managed by the Ministry of Rural Development for old age persons, widows and the disabled, while, post offices will also be included from October 1.

The Ministry of Home Affairs and the Registrar General of India (RGI) will work towards accelerating biometric collection in select districts in the National Population Register (NPR) states so that coverage of 70-80 per cent is achieved by June and DBT could be rolled out from July 1 successfully.

The government launched its ambitious DBT programme on January 1 this year. The welfare plan was initially rolled out in 20 districts and covered seven schemes, mostly scholarships, and is likely to have benefited more than 2 lakh people. A total of 43 districts in 16 states have been identified for the first round of DBT that will cover 26 social welfare schemes.    

The primary aim of this Direct Benefit Transfer program is to bring transparency and terminate corruption from distribution of funds sponsored by the government. In DBT, benefit or subsidy will be directly transferred to the citizens living below poverty line and curbing the subsidy to those who don't require it.

The CNX Nifty touched a high and a low of 5,577.30 and 5,534.70 respectively. 

The top gainers on the Nifty were Maruti up by 7.18%, ONGC up 2.23%, HCL Tech up 2.00%, Sesa Goa up 1.80% and Hindalco up by 1.69%.

On the flip side, the top losers of the index were, NMDC down by 4.94%, ITC down by 2.90%, NTPC down by 2.87%, HDFC down by 2.87% and Ambuja Cement down by 2.51%.

Most of the European markets were trading in red, France’s CAC 40 down by 1.46%, the United Kingdom’s FTSE 100 down by 1.50% and Germany’s DAX down by 1.22%.

Asian markets ended mixed on Friday with increasing tensions in the Korean peninsula ahead of the US jobs data. However, Japanese market closed higher as investors were indulged in some heavy buying across the board, buoyed by the Bank of Japan's monetary easing steps. Meanwhile, Hong Kong market went home with red market, with growth-sensitive sectors witnessing some of the bigger hits.

Markets in China and Taiwan remained shut for the trade today.