Post Session: Quick Review

Markets witnessed correction, after two sessions of consolidation on Wednesday. Benchmark equity indices remained under pressure for most part of the trading session. Although, local equity markets witnessed some gains in early deals after soft US jobs data cemented hopes that the Federal Reserve would not start tapering monetary stimulus until 2014, profit-booking soon followed in absence of any fresh positive trigger which could take markets higher. Further, negative regional counters also added to pessimistic milieu. Nevertheless, benchmarks trimmed some of their losses in the last hour of the trade as lower level buying got triggered in. By the close of the trade, both Sensex and Nifty, lost over half a percent and ended below the crucial 20,800 and 6,200 levels respectively. On the broader indices front, Midcap and Smallcap indices witnessed slender losses.

On the global front, Asian pacific shares mostly ended into negative territory, as markets became concerned over the health of the US economy. The sharpest move was in Japan, where the Nikkei 225 fell 2%, as the yen strengthened against the dollar. Additionally, European shares snapped their nine-day winning streak on Wednesday as blue chips including chip maker STMicroelectronics and brewer Heineken unveiled weak updates. While, Heineken cut its full-year profit guidance due to a drop in sales in some regions, the quarterly revenues at STM fell short of street’s expectations, sending the stocks down 3.1% and 5.7%, respectively.

Closer home, stocks from Realty, Power and Information Technology (IT) counters were the weak links of the trade. Shares of Wipro dragged the IT pivotal lower. Wipro ended over 4% lower, after the IT major reported its results for the quarter ended September 30 which clearly lagged performance compared to the top tier players. Although, the company grew at its fastest pace in two years in the September quarter by posting 2.7 per cent sequential growth in dollar terms, momentum was believed to be slow as compared to other peers. On the flip side, stocks from Capital Goods and banking counters stood to the test of time. Most state-banks were up in trade on reports of Finance Minister approving government’s budgeted Rs 14,000 crore capital infusions into these banks.

On the result front, while, cement maker ACC stocks gained even as the company’s consolidated net profit halved to Rs 118.90 crore for the third quarter of the calendar year 2013 on lower realizations, Exide Industries slipped over 2% on reporting marginal fall in Q2 net profit at Rs 118.63 crore. Additionally, Hero MotoCorp added over 3/4 of a percent on reporting rise of 9.26% in its net profit at Rs 481.41 crore for the quarter as compared to Rs 440.58 crore for the same quarter in the previous year. The market breadth on the BSE ended in red; advances and declining stocks were in a ratio of 1177: 1240, while 176 scrips remained unchanged. (Provisional)

The BSE Sensex lost 135.79 points or 0.65% to settle at 20729.18.The index touched a high and a low of 20922.32 and 20589.72 respectively. Among the 30-share Sensex, 8 stocks gained, while 22 stocks declined. (Provisional)

The BSE Mid cap and Small cap indices ended lower by 0.04% and 0.29% respectively. (Provisional)

On the BSE Sectoral front, Consumer Durables up by 0.49%, Bankex up by 0.42%, Consumer Durables up by 0.36% and FMCG up by 0.09%, were the only gainers, while Realty down by 1.62%, Power down by 1.17%, IT down by 1.13%, Oil & Gas down by 1.12% and Teck down by 1.06% were the top losers in the space. (Provisional)

The top gainers on the Sensex were Gail India up by 3.89%, Cipla up by 2.74%, SBI up by 2.35%, L&T up by 1.35% and ICICI Bank up by 1.30%, while, Wipro down by 4.41%, Sun Pharma down by 2.39%, BHEL down by 1.93%, Bharti Airtel down by 1.73% and Bajaj Auto down by 1.72% were the top losers in the index. (Provisional)

Meanwhile, Finance minister P Chidambaram, after reviewing the performance of public sector banks, has allowed the government to infuse the budgeted Rs 14,000 crore of bank capitalization through preferential allotment. However, the minister ruled out the possibility of the government diluting its shareholding in the state-run banks.

This development is complete contradiction to Reserve Bank of India’s suggestion of government diluting ownership in Public State Banks even below 51% as an option for raising funds and easing fiscal burden, with government maintaining of keeping its stake in state-run banks at 58%.

Further, the minister has left it on the bank’s board to decide upon the issue of raising capital from the markets through qualified institutional placement (QIP) or other routes, which would be in addition to the capital infusion by the government. This development comes on the heels of the country's biggest lender, State Bank of India mulling raising 8,000 crore through the QIP route. The bank, in which government holds 62.31% stake, is expected to take a call on this within a month. The government, so far has  infused Rs 12,517 crore into 13 PSBs in 2012-13. It had infused about Rs 20,117 crore in PSBs during 2010-11, and Rs 12,000 crore in 2011-12.

India VIX, a gauge for markets short term expectation of volatility gained 1.95% at 20.35 from its previous close of 19.96 on Tuesday. (Provisional)

The CNX Nifty lost 33.20 points or 0.54% to settle at 6,169.60. The index touched high and low of 6,217.95 and 6,116.60 respectively. Out of the 50 stocks on the Nifty, 16 ended in the green, while 33 ended in the red and one stock remains unchanged.

The major gainers of the Nifty were Bank of Baroda up 5.21%, Gail up by 3.92%, Cipla up by 2.73%, SBI up by 2.45% and ACC up by 2.09%. The key losers were Wipro down by 4.60%, Cairn down by 3.80%, DLF down by 3.14%, Sun Pharma down by 2.99% and NTPC down by 2.25%. (Provisional)

Most of the European markets were trading in red with, France’s CAC 40 down by 0.88%, the United Kingdom’s FTSE 100 down by 0.46% and Germany’s DAX down by 0.41%.

The Asian markets barring Jakarta Composite and KLSE Composite concluded Wednesday’s trade in red after US jobs data came in well below expectations. The worse-than-expected jobs reading overnight reinforces the idea that stimulus will remain unchanged until next year. Investment in Indonesia continued to grow during the third quarter of this year, despite concerns that much of the shine had been taken off the country’s economy in recent months. The finance ministry raised Rp 12 trillion ($1.1 billion) from the sale of bonds and bills of various tenors as the country needs funds to plug its widening budget deficit.

China’s biggest banks tripled the amount of bad loans written off in the first half cleaning up their books ahead of what may be a fresh wave of defaults. China signaled concern yesterday that ample credit could fuel inflation as a report showed house prices jumped the most in nearly three years, with double-digit gains in major cities.