Benchmarks recoup some losses despite Rupee’s free fall

Indian equity markets have recouped some lost ground as support emerged to bourses at lower levels, even as Indian currency extended losses on sustained dollar demand from importers, in absence of RBI’s intervention. Albeit trading with colossal losses of over a percent, benchmark 30-share index, Sensex, was trading above 19,150 level, while Nifty reclaimed 5,800 bastion. Nevertheless, Indian equity markets could extent its freefall further in the session tracing a negative European markets start. European stocks slipped as the Bank of Japan refrained from expanding stimulus and a German court began hearings on the European Central Bank’s bond-buying plan. Closer home, amidst across the board selling, immense pressure was exerted from stocks belonging to metal, realty and Consumer Durable counters. The overall market breadth on BSE is in favour of declines, which have thumped advances in the ratio of 1576:442; while 111 shares remain unchanged.

The BSE Sensex is currently trading at 19,191.46, down by 249.61 points or 1.28% after trading in a range of 19,418.74 and 19,121.18. There were 8 stocks advancing against 22 declines on the index.

The broader indices pared some loss; the BSE Mid cap index was down by 1.58% and Small cap index was down by 1.77%.

There were no gaining sectoral indices on the BSE while Metal down by 4.39%, Realty down by 3.60%, Consumer Durables down by 2.23%, Bankex down by 1.73% and Power down by 1.69% were the top losers on the BSE.

The top gainers on the Sensex were Cipla up by 0.87%, Dr Reddys Lab up by 0.49%, Hero MotoCorp up by 0.40%, Gail India up by 0.36% and NTPC up by 0.27%.

On the flip side, Jindal Steel down by 18.06%, Hindalco was down by 5.62%, Tata Power down by 4.28%, ICICI Bank down by 3.24% and Tata Steel down by 3.01%were the top losers on the Sensex.

Meanwhile, after inquiring into charges levelled by a online portal Cobrapost, the Reserve Bank of India (RBI) has imposed a fine of Rs 5 crore on Axis Bank, Rs 4.5 crore on HDFC Bank and Rs 1 crore on ICICI Bank for violation of know your customer (KYC) norms and anti-money laundering guidelines. In its probe into the issues raised by the Cobrapost sting operation, the RBI has revealed various discrepancies in banking operations, including non-compliance of KYC norms and fictitious PAN cards.

The online portal altogether had named about 33 public and private sector banks in its various money laundering operations. Apart from this, insurance companies were also figured in the expose.

The central bank said, ‘after considering the facts of each case, the RBI came to conclusion that some of the violations were substantiated and warranted imposition of monetary penalty’. By adding further the RBI said that a similar scrutiny was being conducted at corporate offices of 36 other banks and the process of follow up action in respect of these banks is at different stages of its completion.

Last month, the RBI report had pointed string of violations on several counts by these banks, which include the usage of identity cards of unknown NRIs and dummy PAN, unauthorized gold sales and non-compliance of KYC norms. Further, the central bank also revealed that banks’ staffs were also engaged in giving suggestions to customers on ways to bypass regulatory norms.

The CNX Nifty is currently trading at 5,804.35, down by 73.65 points or 1.25% after trading in a range of 5,868.05 and 5,781.80. There were 12 stocks advancing against 38 declines on the index.

The top gainers of the Nifty were HCL Tech up by 1.85%, Cipla up by 1.15%, Hero MotoCorp up by 1.05%, GAIL up by 0.87% and Kotak Bank up by 0.60%.

On the flip side, Jindal Steel down by 17.94%, Hindalco down by 5.77%, DLF down by 4.67%, Tata Power down by 4.34% and IndusInd Bank down by 3.52% were the major losers on the index.

Most of the Asian equity indices were trading in red; Hang Seng declined 1.12%, KLSE Composite declined by 0.61%. Straits Times crumbled 1.77%, KOSPI Composite dropped 0.62% and Taiwan Weighted slid 0.34%. On the flip side, Jakarta Composite gained 0.66%, Nikkei 225 added 0.89%

Markets in China remained closed for the trade on account of Dragon Boat Festival holiday.

European markets got off to a negative start; with CAC 40 declining by 0.75%, DAX sliding by 0.84% and FTSE 100 shedding 0.59%.