Post session - Quick review

Indian equity markets prolonged the lull to the final session of the week on Friday as trader’s sitting on their hands, preferred building up their cash level. Volatility once again remained the order of the day as immensely volatile trend was witnessed since the inception of the trade as benchmark indices after dipping their heads in early deals, recouped only to slide further. However, the rest of the trade was mere reflection of the daunting global set up which has been acting short of mood dampener for Dalal Street from previous two week, this week acting no different.

Sentiment at equity markets were spooked after a spike in Spanish government borrowing costs added to the uncertainty over Europe's debt crisis. Spain's government yesterday auctioned 10-year government bonds that would see the country paying interest of nearly 7 per cent - the highest rate since 1997 and a level that many economists see as unsustainable. However, France's borrowing costs which also rose following an auction of midterm bonds saw strong demand adding to the investor’s angst. Meanwhile, concerns over bad loans in China's property sector emerged after government report showed new house prices in October fell in 33 of 70 cities measured from the month before, added to the already pessimistic milieu, besides denting the trade in Asia pacific markets.

Negative leads at the start of the trade also came to Indian equity markets in the form of sedate close of Wall Street as US stocks plummeting for fourth straight session on Thursday slumped on concerns of whether politicians will be able to find $1.2 trillion in budget cuts before a November 23 deadline and also as a report that the US unemployment situation improved slightly wasn't capable to overcome the gloom. Applications for jobless benefits decreased 5,000 in the week ended November 12 to 388,000, the lowest level in seven months. Also, new housing starts in the US declined 0.3% in October at a seasonally adjusted annual rate of 628,000 to the revised September rate of 630,000, according to data released by the US Commerce Department showed. Meanwhile, European shares stroked a new five-week lows on Friday, on the mounting worries that borrowing costs in several euro zone countries are at unsustainable levels, and policymakers are not acting to stem the region's debt crisis .

Back on the home turf, wretchedness also crept into the markets with the plunge of Fertilizer stocks after finance Ministry rejected a policy drafted by the Planning Commission to attract new investment in the urea sector, saying the proposals are unrealistic, unviable and will lead to high subsidy outgo. Reacting to this news, Chambal Fertilisers slid 7%, National Fertilizers declined over 2.50% and RCF descended over 6%.  Stocks of Realty, Fast Moving Consumer Goods and Metal space also followed the suite and contributed to the downfall of the bourses.

However, some recuperation that emerged in the dying hours of trade prevented benchmarks from getting an another horrendous close as investor’s after witnessing 7 day’s long bear run cherry picked few fundamentally strong stocks. Bounce back of stocks from Healthcare, Consumer Durable and Oil & Gas counters also aided the recovery which led to 30 share index of BSE-Sensex-close above the 16300 level with loss of close to 100 points. Imitating the similar trend, the 50 share index on NSE-Nifty-declining over 25 points managed to end above the 4900 level. However, the broader indices went home with slightly bigger loss of over 1%.The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 900:1981 while 98 scrips remained unchanged.

The BSE Sensex lost 66.99 points or 0.41% and settled at 16,394.72. The index touched a high and a low of 16,396.69 and 16,164.99 respectively. 14 stocks advanced against 16 declining ones on the index (Provisional)

The BSE Mid-cap index lost 0.96% while Small-cap index was down 1.74%. (Provisional)

On the BSE Sectoral front, Oil & Gas up 0.57%, Consumer Durables up 0.24% and Health Care up 0.15% were the only gainers while FMCG down 1.59%, Realty down 1.45%, Auto down 1.19%, Metal down 1.09% and Power down 0.79% were the top losers.

The top gainers on the Sensex were Tata Power up 2.89%, Hero MotoCorp up 2.85%, Wipro up 2.80%, ONGC up 2.29% and HDFC up 1.44%.

On the flip side, ITC down 2.92%, M&M down 2.84%, Tata Motors down 2.31%, SBI down 2.11% and TCS down 2.07% were the top losers on the index. (Provisional)

Meanwhile, the bearish sentiments in the capital market, slowdown in economic activities and uncertainties in the global economy, Finance Minister Pranab Mukherjee is hopeful of meeting disinvestment targets for the current financial year. He said 'I am not revising it (the target) right now. We have fixed the target and we will try to achieve it, but it depends on many other situations, particularly the economic health conditions.'

In the first seven months of the current financial year, the government has been only able to raise around Rs 1,145 crore through a stake sale in Power Finance Corporation (PFC) and there are apprehensions that the government may miss the disinvestment target of Rs 40,000 crore.

The government has delayed its proposed stake sales in the Public Sector Units because of the volatile stock market conditions. The international equity markets have been on a downslide on worries over the ongoing debt crisis in the euro zone and credit crunch in the United States. 'All these aspects have to be taken into account and the government will take a decision at the appropriate time,' Mukherjee said.

Considering uncertain market conditions, public sector firms such as SAIL and Hindustan Copper (HCL) have delayed planned issue of fresh equity issue, through the government may still go ahead with its proposal to offload stake. Further, the government is also planning to divest its stake in ONGC, BHEL, RINL, Hindustan Aeronautics and NBCC, among other companies. During 2010-11, the government had raised around Rs 22,763 crore via the sale of equity in public sector enterprises.   India VIX, a gauge for market’s short term expectation of volatility lost 1.26% at 26.58 from its previous close of 26.92 on Thursday. (Provisional)

The S&P CNX Nifty lost 20.30 points or 0.41% to settle at 4,914.45. The index touched high and low of 4,915.90 and 4,837.95 respectively. 25 stocks advanced against 24 declining ones while 1 stock remained unchanged on the index. (Provisional)

The top gainers on the Nifty were SAIL up 7.79%, Hero MotoCorp up 3.79%, IDFC up 2.57%, Tata Power up 2.31% and Wipro up 2.30%.

On the other hand, Sesa Goa down 4.18%, ITC down 3.51%, Power Grid down 2.91%, M&M down 2.74% and BHEL down 2.42% were the top losers. (Provisional)

The European markets are trading in mix, with France's CAC 40 up 0.03%, Germany's DAX down 0.24% and FTSE 100 down 0.54%.