Selling carnage continues; Nifty slips below 5,400 mark

Indian equity markets added losses to continue weak trade in the late afternoon session on account of selling pressure due to global jitters and domestic concerns, that made investors extremely pessimistic on holding equities. The rupee’s depreciation to a record low despite policy makers’ efforts to defend the currency is too hurting investors’ sentiment. The currency fell as far as 62.78 to the dollar, breaching the previous low of 62.03 hit on Friday. World Bank chief economist Kaushik Basu warned that the next year and a half will be tough for India and for the global economy too accented pessimistic view. Basu added that capital control measures and import restrictions are unwarranted in the government’s fight to shield the rupee. Traders were seen piling position in Metal and IT stocks while selling was witnessed in Auto, Bankex and Health Care sector stocks. In scrip specific development, Strides Arcolab was trading in green after the prime minister’s office cleared Rs 9,920 crore Strides-Mylan buyout deal with riders.

On the global front, most of the Asian markets were trading in red barring Shanghai Composite and Nikkei 225 while the European markets were too trading on pessimistic note.  Back home, the NSE Nifty and BSE Sensex were trading below their psychological 5,400 and 18,300 levels respectively. The market breadth on BSE was negative in the ratio of 660:1433, while 122 scrips remain unchanged. 

The BSE Sensex is currently trading at 18208.62, down by 389.56 points or 2.09% after trading in a range of 18,587.38 and 18149.86. There were only 7 stocks advancing against 23 declines on the index.

The broader indices were trading in red; the BSE Mid cap and Small cap indices were trading lower by 1.81% and 1.34% respectively.

The top gaining sectoral indices on the BSE were, Metal up by 0.80% and IT up by 0.36% while, Auto down by 4.05%, Bankex down by 3.54%, Healthcare down by 2.84%, PSU down by 2.79% and Capital Goods down by 2.56% were the top losers indices on the BSE.

The top gainers on the Sensex were Tata Steel up by 2.64%, Jindal Steel up by 2.06%, Hindalco Industries was up by 1.98% Tata Power up 1.77% and Infosys up by 0.69%. On the flip side, Bharti Airtel down by 7.65%, Hero Moto Corp down by 6.26%, Bajaj Auto down by 5.81%, ONGC down by 5.66% and ICICI Bank down by 4.80% were the top losers on the Sensex.

Meanwhile, amid a poor performance in road development and consequent scaling down of the annual target to almost half at 5,000 km for 2013-14, the Road Transport and Highways Ministry has pinned hopes on engineering- procurement-construction (EPC) mode for project awards to pick momentum in road construction. The Ministry has already clarified that it has decided to adopt this road building approach for projects which are not viable on Public Private Partnership (PPP) basis. All public funded National Highways projects, and centrally sponsored road works, costing more than Rs 10 crore would henceforth be awarded on EPC mode of contract, it notified.

In the previous fiscal, road ministry awarded only 1,400 km of projects against a target of 9,500 km and had cited reasons like lukewarm response by the bidders owing to a number of factors including delay in clearances. Further, it has subsequently scaled down its projects award target by nearly half to 5,000 km for the current fiscal.  Meanwhile, in the wake continued dismal show in award of projects by the Ministry, the 12th Five Year Plan (2012-17) envisages construction of 20,000 km of two-lane National Highways based on EPC mode.

The Government has adopted the EPC mode of construction to ensure implementation of projects to specified Standards with a fair degree of certainty relating to cost and time and with a view to enabling a transparent, fair and competitive roll out of National Highway projects. The EPC mode assigns the responsibility for investigation, design and construction to contractors for a lump sum price awarded through competitive bidding, wherein provision for index-based price variation is made. Further, under the EPC model, the government spends the entire money required to build roads which may prove lucrative to builders.

The CNX Nifty is currently trading at 5,384.85, down by 123.00 points or 2.23% after trading in a range of 5,499.65 and 5,370.05. There were 13 stocks advancing against 37 declines on the index.

The top gainers of the Nifty were Tata Steel up by 2.83%, Jindal Steel up by 2.11%, Hindalco Industries up by 2.08%, NMDC up by 1.84% and Reliance Infrastructure up by 1.72%. On the flip side, Bank of Baroda down by 7.77%, Bharti Airtel down by 7.64%, Hero MotoCorp down by 6.32%, Bajaj Auto down by 6.05% and IDFC down by 5.85% were the major losers on the index.

Most of the Asian equity indices were trading in red; Straits Times down by 0.87%, Jakarta Composite down by 5.49%, KLSE Composite down by 0.57%, Seoul Composite down by 0.13% and Taiwan Weighted down by 0.31%. While, Shanghai Composite gained 0.83% and Nikkei 225 was up by 0.79%.

The European markets were trading in red; France’s CAC 40 was down 0.70%, Germany’s DAX lost 0.63% and the United Kingdom’s FTSE 100 edged lower 0.29%.