Benchmarks end volatile session on a quiet note

Indian equity indices snapped the volatile day of trade on an absolute flat note on Wednesday as investors booked their profit after rally of over two and a half percentage points in previous two sessions. Though, markets started off on a positive note supported by Monetary Fund (IMF) report saying that India with its favorable interest rate-growth differential has an advantage in addressing deficit concerns this year. Moreover, rally in rate sensitive stocks too aided the sentiments as slowing wholesale price inflation has raised rate cut expectations.

Supportive cues from US markets provided the much needed support to local markets in first half. Investors’ morale got buttressed after Federal Reserve stated that industrial production rose a seasonally adjusted 0.4% in March, and February’s growth was revised higher to 1.1% from the initially reported 0.8% advance. Moreover, Asian counters too shut shop mostly in green with Japanese Nikkei surging by over a percent as the yen weakened after the IMF raised the growth forecast for Japan.

However, weakness in European markets took their toll on domestic sentiments in second half and dragged the frontline gauges below their pre-close level. Investors mainly resorted to profit booking following the decline in European markets.

Back home, some cautiousness also came in from fall of about four percent in index heavyweight Reliance Industries as its top line dropped 1.4% to Rs 86,618 crore and debt rose to Rs 72,427 crore at the end of the quarter. Though, the company posted a 32% increase in its fourth quarter net to Rs 5,589 crore, the biggest rise in nearly three years. Selling was also witnessed in software and technology counters as Indian rupee hit a new seven week high at 53.77 per dollar versus its previous close of 54.15/16 supported by broad risk-rally in regional markets. Additionally, public sector oil marketing companies (OMCs) viz. BPCL, HPCL and IOC edged lower after petrol price was on April 15 cut by Re 1 per litre, the third reduction in rates in one month. The price cut, which was made possible because of fall in international oil prices, excludes local sales tax or VAT.

However, the losses remain capped as FMCG counters garnered a gain of over a percent on reports of likely normal monsoon this year. Stocks from infra sector too rallied on the buzz that the Ministry of Road Transport and Highways is targeting national highway contract awards worth about Rs 90,000 crore spanning 7,300 km this fiscal.

The NSE’s 50-share broadly followed index Nifty declined marginally to end below its psychological 5,700 support level, while Bombay Stock Exchange’s Sensitive Index - Sensex dipped by just thirteen points to end its psychological 18,750 mark. Moreover, the broader markets outperformed benchmarks and snapped the session in the green.

The overall volumes stood at over Rs 2.30 lakh crore, which remained on the higher side as compared to that on Tuesday. The market breadth remained in favor of declines as there were 1,128 shares on the gaining side against 1,199 shares on the losing side while 157 shares remain unchanged.

Finally, the BSE Sensex lost 13.77 points or 0.07% to settle at 18,731.16, while the CNX Nifty declined by 0.25 points to end at 5,688.70.

The BSE Sensex touched a high and a low of 18,869.88 and 18,673.44, respectively. The BSE Mid cap index up by 0.18% and Small cap index was up by 0.30%.

The top gainers on the Sensex were, Sterlite Industries up by 4.05%, Mahindra & Mahindra up by 3.91%, Sun Pharma up by 3.01%, SBI up by 2.87% and ICICI Bank up by 1.70%, while Reliance down by 3.78%, Wipro down 1.77%, TCS down 1.73%, HDFC down 1.57% and Tata Power down by 1.56% were the top losers on the index.

The top gainers on the BSE Sectoral space were Metal up 1.27%, FMCG up 1.25%, Auto up 1.16%, Health Care up 1.09% and Bankex up 0.93%, while Oil & Gas down 2.12%, IT down 1.14%, TECk down 0.77% and Power down 0.17% and Capital Goods down 0.03% were the top losers on the sectoral space.

Meanwhile, in a move to improve the road infrastructure of the country, the Ministry of Road Transport and Highways is targeting national highway contract awards worth about Rs 90,000 crore for this fiscal spanning around 7,300 km. Projects spanning around 3,800 km (or 52% of the total length) will be awarded from this month to September.

Following the poor response to the public-private partnership or PPP model in last fiscal, the ministry plans to award more than 50% of projects on engineering procurement contract (EPC) basis this fiscal. EPC could help rejuvenate the road construction industry. So the ministry has already prepared a model concession project for EPC projects.

In the last fiscal, national highway contract awards were dismal, like during the 2008-09 slowdown, projects spanning a mere 787 km were awarded, only slightly better than the 600 km awarded in 2008-09. Lack of equity with road construction companies and macroeconomic slowdown were the major reasons behind the poor show.     

The CNX Nifty touched a high and a low of 5,732.15 and 5,669.00 respectively. 

The top gainers on the Nifty were Sesa Goa up by 4.43%, Ambuja Cement up 4.07%, M&M up 3.75%, Sun Pharma up 3.10% and Lupin up by 3.09%.

On the flip side, the top losers of the index were, Reliance down by 3.34%, Reliance Infra down by 2.49%, ONGC down by 1.78%, Tata Power down 1.77% and TCS down by 1.57%.

Most of the European markets were trading in red, France’s CAC 40 down by 1.55%, the United Kingdom’s FTSE 100 down by 0.50% and Germany’s DAX down by 1.40%.

Asian stock markets ended mostly higher on Wednesday, as sentiments were boosted by positive American corporate earnings and data supporting the case for ongoing US monetary stimulus. Japanese market went home with green mark supported by rise in value of the dollar and euro against the yen. South Korea's market closed marginally higher as tensions still lingered on the Korean Peninsula. Regional stocks recovered after two days of volatile trading because of Monday's weaker-than-expected Chinese growth data and a sharp drop in the price of gold.