Post Session: Quick Review

Friday’s trading session largely turned out to be disheartening as markets’ early exuberance witnessed on the back of better than expected Infosys’ numbers, fizzed out by the end of the trade, leading to flattish close of benchmarks ahead of factory output data, which is due to release later in the evening. However, street expects industrial output to return to modest growth in November after shrinking for the first time in four months in October, helped by better overseas demand. By the close of trade, Sensex and Nifty concluded above the psychological 20,750 and 6,150 levels respectively.

Intra-day trend reversal which took post the results of IndusInd bank mainly erased most of the gains of the bourses. Otherwise, earlier in the session, markets gathered good gains after IT bellwether posted better-than-expected net profit of Rs 2,875 crore on sales of Rs 13,026 crore for the October to December quarter and upped its revenue guidance for this fiscal (2013-14) upwards to 12 per cent from previous estimate of 10 per cent in dollar terms. Sentiments remained upbeat uptill noon deals also on account of narrower trade deficit figures for November. On the macro-front, with exports registering growth of 3.49% to $26.35 billion for the month of December, India’s trade deficit narrowed to $10.14 billion in December from $17.59 billion a year earlier.

However, trade took a turn for the worse after IndusInd Bank’s Q3 results spelled pessimism for the entire banking pivotal. Private sector lender stocks tanked close to 3% on asset quality concerns, even as the bank reported better than expected net profit growth by 29.8 percent, year-on-year basis to Rs 346.9 crore. The bank’s Gross non-performing assets (NPA) climbed to 1.18 percent during the quarter from 1.11 percent in earlier quarter and 0.99 percent in a year ago period.

However, mostly positive global set-up rendered some support to the markets, which ended on a bit of positive note. On the global front, Asian markets were mixed following another weak lead from Wall Street as investors awaited the release of key US jobs data, while Shanghai eased after China said its trade surplus shrank in December.  On the flip side, European shares rose in early trade on Friday, reversing the previous session's losses with markets on the euro zone periphery adding to brisk gains made so far this year

Closer home, stocks from information Technology, FMCG and Oil & Gas counter were the top gainers of the session, while Metal, banking and Realty counters were the top losers. Good performance from Infosys spelled optimism for entire Technology counter, massive gains of Reliance Industries too lifted the entire Oil & Gas pivotal higher. On the other hand, banking shares tanked ahead of key wholesale and consumer price data next week, which will help determine whether the Reserve Bank of India will resume raising interest rates after tightening monetary policy by a total of 50 basis points over September and October. However, India's inflation rate will probably ease in December to 7.00 percent from the 14-month high of 7.52 percent in November helped by waning food prices.  The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 1048: 1496, while 137 scrips remained unchanged. (Provisional)

The BSE Sensex gained 45.12 points or 0.22% to settle at 20758.49. The index touched a high and a low of 20971.23 and 20625.17 respectively. Among the 30-share Sensex, 9 stocks gained, while 21 stocks declined. (Provisional)

The BSE Mid cap and Small cap indices ended lower by 0.99% and 0.61% respectively. (Provisional)

On the BSE Sectoral front, IT up by 2.15%, Teck up by 1.75%, FMCG up by 1.48%, Oil & Gas up by 1.48% and Healthcare up by 0.40% were the top gainers, while Metal down by 1.65%, Bankex down by 1.55%, Realty down by 1.52%, Power down by 1.43% and Capital Goods down by 1.40% were the only losers in the space. (Provisional)

The top gainers on the Sensex were Infosys up by 2.84%, Wipro up by 2.10%, ITC up by 2.08%, TCS up by 2.07% and Dr Reddys Lab up by 1.47%, while, Mahindra & Mahindra down by 2.63%, Coal India down by 2.43%, Hindalco Industries down by 2.30%, SBI down by 2.25% and SSLT down by 2.05% were the top losers in the index. (Provisional)

Meanwhile, with exports registering growth of 3.49% to $26.35 billion for the month of December, India’s trade deficit narrowed to $10.14 billion in December from $17.59 billion a year earlier. Additionally, Imports during the same month contracted by 15.25 percent over at $ 36.49 billion as compared to $43.05 billion in December, 2012.

Cumulatively, the trade deficit for April-December, 2013-14 was estimated at $110.04 billion was lower than the deficit of $146.82 billion during April-December, 2012-13. Meanwhile, cumulative exports for the period April-December 2013 -14 grew by 5.94 percent at $230.33 billion over the corresponding period a year ago. Additionally, cumulative imports shrunk by 6.55 per cent to $ 340.37 billion in the reporting period.

A sharp contraction in imports was witnessed during December on account of decline in non-oil imports, which was 22.9 percent lower at $22.59 billion. Meanwhile, Non-oil imports during April-December, 2013-14 were valued at $215.42 billion, which was 11.1 percent lower than the level of such imports valued at $242.41 billion in the corresponding period in previous year.

With this, Commerce Ministry is confident of meeting the export target of $325 billion this fiscal with most sectors, except some such as pharmaceuticals and gems & jewellery, doing well. Last fiscal, exports fell by 1.82 per cent to $300.4 billion due to a slowdown in global demand. With a recovery in the US and the EU, exports in April-November 2013 stood at $204 billion posting a growth of 6.4 per cent over the same period in the previous year.

The CNX Nifty gained 5.75 points or 0.09% to settle at 6,174.10. The index touched high and low of 6,239.10 and 6,139.60 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 Infosys up 2.99%, ITC up by 2.27%, TCS up by 2.15%, Wipro up by 1.96% and Dr. Reddy's Laboratories up by 1.48%. The key losers were IDFC down by 3.20%, IndusInd Bank down by 3.19%, Ranbaxy down by 2.61%, Coal India down by 2.55% and M&M down by 2.44%. (Provisional)

The European markets were trading in green; France’s CAC 40 was up 0.52%, Germany’s DAX added 0.55% and UK’s FTSE 100 gained 0.61%.

The Asian markets concluded Friday’s trade on a mixed note after growth in Chinese exports in December showed a marked decrease from the prior month. Chinese exports grew 4.3% on year in December, a touch slower than expectations for 4.5% growth. The result suggested a substantial slowdown from November’s better-than-expected 12.7% growth. The country’s trade surplus last month was $25.6 billion, compared with expectations for a surplus of $32.2 billion. Chinese economic data so far this year has pointed to a picture of weakness in the world’s second-largest economy, with releases earlier in the month showing a deceleration in activity for both the services and manufacturing sectors.  In addition, inflation numbers on Thursday suggested that the Chinese economy is cooling.

China’s trade balance fell more-than-expected last month to 25.60B, from 33.80B in the preceding month. Japan’s index of leading economic indicators rose less-than-expected last month to a seasonally adjusted 110.8, from 109.8 in the preceding month whose figure was revised down from 109.9. Philippines Industrial Production rose to a seasonally adjusted annual rate of 21.3%, from 20.8% in the preceding month whose figure was revised down from 25.3%.