Post Session: Quick Review

After the previous sessions’ bull run on the bourses, Indian equity markets underwent a correction of close to half a percent on Tuesday as funds and retail investors cashed out profits in absence of fresh positive triggers that could take markets higher amidst mixed global set-up. Caution after a string of speeches by three Federal Reserve presidents suggested that the U.S. central bank could start to scale back its $85-billion-a-month stimulus program as early as this month, mainly haunted markets across the globe, including ours. Moreover, reluctance of investors for adding large positions ahead of October IIP, November CPI data, due on December 12, also added to the downside in the bourses. In the dismal session of the trade, bourses did not once break out in green and kept listlessly gyrating in the negative terrain. In fact, the markets from the word ‘go’, capitulated under selling pressure, although some recovery crept in the last hour of trade as select investors, subscribing to the long-term story of equity markets, indulged in bargain-buying. Thus, by the close of trade, while Sensex managed to end above the crucial 21,250 level, Nifty settled below 6,350 mark. Additionally, broader indices too ended in red, with loss in the range of 0.35-0.70%.

On the global front, Asian stock markets ended mostly lower on Tuesday as investors digested mixed economic data out of China. In Hong Kong, the Hang Seng edged lower after data showed that Chinese industrial output rose less-than-forecast in November, while retail sales topped expectations. Industrial production in China rose 10% last month, below expectations for a 10.1% increase, while retail sales jumped 13.7%, beating estimates for a 13.3% gain. On the flip side, European shares edged lower in early trading on Tuesday, with technical charts pointing to consolidation on main indices and with investors, faced with an uncertain policy and economic outlook, locked in profits into the year-end.

Closer home, most of the sectoral indices on BSE concluded in red terrain, with stocks from Power, Consumer Durables and Public Sector Undertaking counters emerging as top losers. Power stocks tripped after Central Electricity Regulatory Commission (CERC) released draft regulations, which will decide power tariffs for a period of five years from 1 April 2014. Tata Power Company, Torrent Power, Adani Power, Power Grid Corporation of India, NTPC and Reliance Infrastructure lost in the range of 2-10%. Additionally, Auto stocks too ran out of steam after data from Society of Indian Automobile Manufacturers (Siam) showed that domestic passenger car sales declined 8.15% to 142,849 units in November this year compared with 155,535 units sold in the same month last year. On the flip side, Information Technology, Technology and Fast Moving Consumer Goods stocks witnessed some defensive buying to emerge as the top gainers in the session. The market breadth on the BSE weighed more on the negative side; advances and declines were in a ratio of 986: 1452, while 177 scrips remained unchanged. (Provisional)

The BSE Sensex lost 73.56 points or 0.34% to settle at 21252.86.The index touched a high and a low of 21327.75 and 21175.08 respectively. Among the 30-share Sensex, 14 stocks gained, while 16 stocks declined. (Provisional)

The BSE Mid cap and Small cap indices ended lower by 0.16% and 0.68% respectively. (Provisional)

On the BSE Sectoral front, IT up by 2.13%, Teck up by 1.50%, FMCG up by 0.98%, Metal up by 0.96% and Healthcare up by 0.38%, were the top gainers, while Power down by 4.18%, Capital Goods down by 3.01%, PSU down by 2.59%, Bankex down by 1.89% and Realty down by 1.62% were the top losers in the space. (Provisional)

The top gainers on the Sensex were Hero MotoCorp up by 4.07%, TCS up by 4.05%, SSLT up by 2.61%, Hindustan Unilever up by 1.59% and Wipro up by 1.57%, while, NTPC down by 11.16%, L&T down by 4.11%, ICICI Bank down by 3.59%, BHEL down by 3.15% and SBI down by 2.39% were the top losers in the index. (Provisional)

Meanwhile, giving some respite to Special Economic Zones (SEZs) struggling with global economic slowdown, the government has granted more time to some 115 SEZs developers to execute their projects during April 2012 and November 2013.  Earlier, SEZs developers had sought extension of validity period citing reasons like delay in approvals from statutory/state government bodies, adverse business climate because of global economic turmoil, delay in environmental clearance, lack of demand for space in SEZs and changed fiscal incentive regime.

The government has approved 576 such zones out of which 175 have commenced exports. Further, the exports from these zones stood at Rs 2.46 lakh crore during April- September this fiscal.  In 2012-13, it was Rs 4.76 lakh crore, which is about 30 per cent of the country's total exports. Among the total 175 SEZs operation in the country, a maximum of 40 are present in Andhra Pradesh followed by Tamil Nadu having 34, 22 in Karnatka and 20 in Maharashtra.

Over the past two years, investments in SEZs have reduced owing to the imposition of taxes and the requirements of certain clearances, denting the attractiveness of these units. Meanwhile, the government has started taking measure to ease SEZs norms, which will be helpful to enhance country’s industrial development and increase exports. In an attempt to revive investors’ interest in the zones, Commerce Ministry has recently slashed the minimum area requirement for setting up SEZs. 

India VIX, a gauge for markets short term expectation of volatility lost 6.15% at 17.98 from its previous close of 19.16 on Monday. (Provisional)

The CNX Nifty lost 31.10 points or 0.49% to settle at 6,332.80. The index touched high and low of 6,362.25 and 6,307.55 respectively. Out of the 50 stocks on the Nifty, 19 ended in the green, while 31 ended in the red.

The major gainers of the Nifty were TCS up 4.1013%, Hero MotoCorp up by 3.81%, SSLT up by 2.42%, Lupin up by 2.36% and ITC up by 1.58%. The key losers were NTPC down by 11.37%, L&T down by 4.11%, Power Grid down by 3.85%, ICICI Bank down by 3.55% and BHEL down by 3.21%. (Provisional)

Most of the European markets were trading in green with, France’s CAC 40 up by 0.19%, the United Kingdom’s FTSE 100 up by 0.15% and Germany’s DAX up by 0.23%.

The Asian markets barring Jakarta Composite and KLSE Composite concluded Tuesday’s trade in red as a slate of data from China offered a mixed view of economic activity. A series of Chinese data out painted a mixed picture of the economy, with industry moderating its strong growth but retail sales picking up their already robust pace. Industrial output for November rose 10% from a year earlier, slowing from the previous month's 10.3% increase but matching the expectations. Chinese retail sales in November climbed 13.7% from a year earlier, up from the 13.3% rise in October. Today’s data also included urban fixed-asset investment, which was up an annualized 19.9% in the January-November period, slowing from a 20.1% gain for January-October. Fixed-asset investment is seen as an indicator of construction activity in China.

Indonesia outlined new fiscal policies, including an increase in taxes on goods ranging from smartphones to jewelry, in a bid to curb imports and raise revenue as a way to reduce its swelling current account deficit by as much as $4 billion next year.  Japanese Household Confidence rose to a seasonally adjusted annual rate of 42.5, from 41.2 in the preceding month.