Post Session: Quick Review

Paring half of the previous sessions’ gains, Indian equity markets witnessed an abysmal session of trade, as investors relentlessly booked profit at higher level after previous session’s sharp gains following Iran’s historic nuclear deal. Meanwhile, recovery in Brent crude prices, with investors judging the historic deal between Iran and world powers would not result in an immediate increase in shipments from the OPEC member, also dented sentiment leading to knock of over a percent for Indian equity markets. Besides, reluctance of traders to take position ahead of F&O expiry amidst negative global set-up also spooked Indian equity markets.

Thus, gradually losing ground for the entire trading session, benchmarks settled at the lowest point of the day, near the psychological 20,500 (Sensex) and 6,050 (Nifty) levels respectively. Additionally, broader indices too witnessing profit-booking, went home with loss of over quarter of a percent.

On the global front, most of Asian stocks fell, led by Japanese shares, as the yen strengthened from six months low versus the dollar. Meanwhile, European shares lacked the momentum to extend a rally to multi-year highs on Tuesday, a mixed outlook for corporate earnings underlined by downbeat signals from Remy Cointreau and Hugo Boss. Shares in Remy dropped 7.5% after the French spirits group warned of a double-digit decline in full-year operating profit because of a slowdown in China.

Closer home, in the ferocious selling pressure, while most of the sectoral indices succumbed to selling pressure, stocks from Auto, Capital Goods and Power counters, outperformed the markets and ended with modest gains. On the other hand, stocks from Banking, Public Sector Undertaking (PSU) and Oil & Gas counters were the top laggards. Stocks of Public Oil Marketing Companies, viz, BPCL, HPCL and IOC witnessed heavy drubbing as oil prices regained some semblance of stability after the previous session's slide, as traders questioned how quickly the Iranian nuclear accord could turn into higher supplies. Meanwhile, sugar stocks hogged limelight for yet another session ahead of UP chief Minister’s meeting with the mills owners later in the evening today. Separately, an all-party delegation from Maharashtra, along with the representatives of agitating farmer’s organizations, is scheduled to meet Prime Minister Manmohan Singh about various demands of the sugar industry. The market breadth on the BSE ended in red; advances and declining stocks were in a ratio of 1059: 1455, while 140 scrips remained unchanged. (Provisional)

The BSE Sensex lost 203.01 points or 0.99% to settle at 20402.07.The index touched a high and a low of 20604.27 and 20390.62 respectively. Among the 30-share Sensex, 7 stocks gained, while 23 stocks declined. (Provisional)

The BSE Mid cap and Small cap indices ended lower by 0.26% and 0.84% respectively. (Provisional)

On the BSE Sectoral front, Auto up by 0.32%, Capital Goods up by 0.30% and Power up by 0.25%, were the only gainers, while Bankex down by 1.42%, PSU down by 1.39%, Oil & Gas down by 1.38%, FMCG down by 1.27% and Realty down by 0.91% were the top losers in the space. (Provisional)

The top gainers on the Sensex were BHEL up by 2.22%, SSLT up by 1.26%, Tata Motors up by 1.04%, Hindustan Unilever up by 0.96% and Hero MotoCorp up by 0.89%, while, ICICI Bank down by 2.54%, Coal India down by 2.28%, Bharti Airtel down by 2.14%, ITC down by 1.96% and Dr Reddys Lab down by 1.65% were the top losers in the index. (Provisional)

Meanwhile, amid rising concerns over the strict infrastructure lending norms, the Reserve Bank of India (RBI) widened the definition of infrastructure lending and also added new sub-sectors for the lending list including water & sanitation, transport, energy, communication, social and commercial infrastructure. The RBI in its notification has said that new sub-sectors will get classified as infrastructure for the purpose of lending by banks and select All India Term-Lending and Refinancing Institutions from the date of this circular.

RBI notification further said that hotels with a project cost of more than Rs 200 crore each and convention centres with project cost of more than Rs 300 crore each come under 'Social and Commercial Infrastructure' category for this kind of lending. The RBI has widened infrastructure-lending norms for sub-sectors as the government has recently written to central bank seeking changes in the rules of infrastructure financing in order to expedite the implementation of infrastructure development in the country.

The government has identified the development of infrastructure a most critical prerequisite for sustaining the present growth momentum of the economy. Meanwhile in order to expedite the implementation of infra projects, the government has been taking various measures. Recently, it has set up Cabinet Committee on Investment (CCI) to accord fast track clearances to large projects. Untill now, the CCI had cleared 209 projects worth Rs 3.84 lakh crore. Meanwhile, for the 12th Five Year Plan (2012-17), the government has set the $1-trillion investment target for the infrastructure sector.

India VIX, a gauge for markets short term expectation of volatility gained 2.56% at 21.59  from its previous close of 21.05 on Monday. (Provisional)

The CNX Nifty lost 59.95 points or 0.98% to settle at 6,055.40. The index touched high and low of 6,112.70 and 6,047.75 respectively. Out of the 50 stocks on the Nifty, 14 ended in the green, while 36 ended in the red.

The major gainers of the Nifty were Lupin up 1.95%, BHEL up by 1.87%, SSLT up by 1.55%, Hindustan Unilever up by 1.14% and Tata Motors up by 1.10%. The key losers were BPCL down by 6.85%, NMDC down by 3.86%, Bank of Baroda down by 3.80%, ICICI Bank down by 2.80% and Cairn down by 2.55%. (Provisional)

Most of the European markets were trading in red with, France’s CAC 40 down by 0.39%, the United Kingdom’s FTSE 100 down by 0.41% and Germany’s DAX down by 0.04%.

The Asian markets concluded Friday’s trade mostly in green with Hong Kong-listed Chinese companies being the best performers for the week. In Hong Kong, overall consumer prices rose 4.3% year-on-year in October, less than September’s corresponding 4.6% increase, the Census & Statistics Department reported. Netting out the effects of all one-off Government relief measures, the year-on-year rate of increase in the Composite Consumer Price Index in October was 4%, also smaller than September’s 4.2% increase. 

Bank of Japan has been ratcheting up its economic growth outlook, with its most recent forecast predicting an average 2.7% expansion in the year to next March, with inflation at 0.7%. Last week, official data showed economic growth halved year-on-year in the July-September quarter as exports weakened and consumer spending slowed.