Post Session: Quick Review

Volatility ruled the roost at the start of F&O expiry week, which led to a flattish close at Dalal Street, despite a positive handover from Asian stocks. What started as promising session of trade, turned out to be a choppy one, where bulls and bears made futile efforts to dominate. While, Sensex prolonged two consecutive sessions’ gaining streak to end above the crucial 18,500 level, Nifty capitulating to selling pressure, ended flat below the psychological 5,500 level. However, flattish to negative close of trade didn’t come as a surprise to the investors during the F&O expiry week. Benchmarks, after getting a promising start, slipped in negative territory during late morning deals, though the benchmarks recovered substantially from day’s low, it again changed track and entered in red zone. Persistent slide of Indian currency past the perilous 64/$, mainly hurt sentiment. Further, a report which pointed India’s fiscal deficit target as challenging also shook investors’ confidence. The rating agency, Fitch in its report said it was getting more challenging for India to meet its fiscal deficit target in the current fiscal year ending March 2014 with revenues slowing.

On the global front, Asian stocks rose for a second day after a slump in US home sales eased speculation that the Federal Reserve will reduce economic stimulus next month. US housing data showed new home purchases plunging in July by the most in three years. On the other hand, European shares were lower in morning trade on Monday, failing to show any real direction with the UK's FTSE 100 closed for a public holiday.

Closer home, persistent buying amid short-covering ahead of expiry of futures and options contract coupled with higher Asian cues, contributed to the upside of the bourses for most part of the session. Further, the sentiment in early deals was also buoyed after the Finance Ministry said that steps to attract capital flows to fund the current account deficit can be expected within a week. Nevertheless, optimism started withering away by the close of trade as investors gradually started booking profits. Stocks from Banking, Oil & Gas and Public Sector Undertaking were the weak spells of trade, while those belonging to Power, Capital Goods and Information Technology counters showed resilience. The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1290: 998, while 150 scrips remained unchanged. (Provisional)

The BSE Sensex gained 19.69 points or 0.11% to settle at 18539.13.The index touched a high and a low of 18728.19 and 18488.93 respectively.  The BSE Mid cap and Small cap indices ended higher by 0.60% and 0.82% respectively. (Provisional)

On the BSE Sectoral front, Power up by 1.44%, Capital Goods up by 1.12%, IT up by 1.11%, Health Care up by 0.99% and Teck up by 0.97% were the top gainers, while Bankex down by 1.16%, Oil & Gas down by 0.55%, PSU down by 0.42%, Auto down by 0.06% and Consumer Durables down by 0.03% were the only losers in the space. (Provisional)Out of the 30 stocks on the Sensex, 19 settled higher, while 11 stocks settled lower.

The top gainers on the Sensex were BHEL up by 5.86%, NTPC up by 2.64%, Sterlite Inds up by 2.39%, Hero MotoCorp up by 2.36% and Wipro up by 2.25%. On the flip side,  ONGC down by 3.71%, Gail India down by 3.02%, ICICI Bank was down by 2.50%, Tata Steel was down by 2.14% and Tata Power was down by 1.28% were the top losers on the Sensex. (Provisional)

Meanwhile, the per capital income, measured by net national income (NNI) has increased by 6.7 percent per annum, while the percentage of poor declined by 2.2 percent during the period 2004-05 to 2011-12 on the back of rising Indian economy, which grew at an average of  8 percent per annum over the period of past few years.

In 2011-12, the government has decided the poverty line in terms of monthly per capita consumption expenditure at Rs 816 in rural areas and Rs 1,000 in urban areas. On state wise, Uttar Pradesh had highest number of people living below poverty line during 2011-12 at 598.19 people out of every lakh. followed by Bihar at 358.15 people (per lakh), Madhya Pradesh 234.04 people, Maharashtra 197.92 people and West Bengal at 184.98 people living below the poverty line.

Meanwhile, the 12th Five Year Plan (2012-17) has stated the need for faster, sustainable and more inclusive growth in the country to reduce economic disparities. Further, the government expects that the growing Indian economy will result in decreasing the percentage of poor in India in coming future.

India VIX, a gauge for markets short term expectation of volatility gained 2.44% at 26.38 from its previous close of 25.75 on Friday. (Provisional)

The CNX Nifty lost 1.30 points or 0.02% to settle at 5,470.45. The index touched high and low of 5,528.70 and 5,454.45 respectively. Out of the 50 stocks on the Nifty, 30 ended in the green, while 20 ended in the red.

The major gainers were Sesa Goa up 9.93%, BHEL up by 6.03%, JP Associate up by 4.87%, Ranbaxy up by 4.38% and Ambuja Cements up by 3.38%. The key losers were IDFC down by 8.77%, Axis Bank down by 5.15%, ONGC down by 3.63%, Gail down by 3.22% and ICICI Bank down by 2.47%.(Provisional)

Most of the European markets were trading in red with, France’s CAC 40 down by 0.59% and Germany’s DAX down by 0.23% while the United Kingdom’s FTSE 100 up by 0.70%.

The Asian markets concluded Monday’s trade mostly in green with mainland Chinese shares jumping amid better-than-expected results from some Chinese firms and reassuring comments on the country’s economic growth. The National Bureau of Statistics spokesman stated that the country will achieve its growth target of 7.5% for this year. Seoul shares rose to their highest closing in a week as Auto and Tech issues rallied on bargain hunting led by foreigners after Friday’s euro zone data brightened the global economic growth outlook. Hang Seng too concluded the trade in green. The median monthly household income in Hong Kong for April to June was $21,900, down from $22,000 reported in the first quarter, the Census & Statistics Department stated. In the second quarter, 6.7% of domestic households had a monthly household income of $80,000 and over, while 16.2% of domestic households had monthly household income of less than $8,000. Japan’s Nikkei average edged down on uncertainties over a planned sales tax hike.

In Indonesia, Finance Minister M. Chatib Basri stated that even as the country is facing a widening current account deficit and the rupiah slips in line with other currencies in the region, it isn’t in a crisis. Separately, the director general for international industrial cooperation at the Industry Ministry stated that despite government efforts to improve value-added manufacturing to make use of Indonesia’s rich natural resources, slow demand from abroad and a weak currency have put a temporary break on the nation’s industrial production. A weakened currency is making it expensive for some manufacturers to import raw materials to make goods such as electronics and garments and shoes. The rupiah has fallen 12% against the US dollar this year.