Post Session: Quick Review

What could have been a comeback session for Indian equity markets, simply turned out to be the one with a flat close that too with negative bias. Intra-day reversal of trade, which took place in the late hours of the trade, dragged benchmarks below the neutral line on the penultimate session of F&O expiry. Otherwise, local bourses for most part of the session held up in green zone, once giving out an impression of green close. Benchmarks started showing signs of fatigue after the release of ICICI Bank’s Q3 numbers. ICICI Bank’s stocks reversed all its gains and  cracked close to two percent by the close of trade despite reporting stable numbers in the third quarter with the net profit growing 12.5 percent to Rs 2,532.2 crore compared to a year ago period, supported by higher net interest income and noninterest income. By the close of trade, both Sensex and Nifty dived to day’s low point which was below the crucial 20,700 and 6,150 levels respectively. Meanwhile, broader indices failing to decide on single trajectory, ended mixed, with Smallcap index showing a degree of underperformance.

Nevertheless, losses of local equity markets remained capped on account of positive global set-up. In the global market, Asian pacific shares rallied on Wednesday after Turkey stunned investors with a huge hike in interest rates, stirring hopes the drastic action would short-circuit a vicious cycle of selling in emerging markets and revive risk appetite generally. Additionally, on receiving positive handover from Asian counterparts, European shares too were trading in positive territory.

Closer home, in the subdued session of trade, stocks from Metal, Banking and Realty counters were the top laggards of the session, while those from Capital Goods, Healthcare and Information Technology counters were the flavor of the session. Meanwhile, public oil marketing companies held up in green for the session despite reports ahead of Cabinet’s meeting on LPG cylinder cap to 12. On the flip side, most of the steel stocks, like Tata Steel and SAIL plunged in the range of 2-3% after government imposed a five percent export duty on iron pellets, a critical raw material for the steel industry. However, JSW Steel’s stocks ended higher on reporting good set of Q3 numbers.  On consolidated basis, the company reported a net profit of Rs. 466.49 crore for the quarter to December, driven by higher sales that was backed by exports which more than doubled during the period. Another disappointment for the street came with Bharti Airtl’s stocks which dived close to 2% despite reporting good set of Q3 numbers. Telecom major reported a consolidated net profit of Rs 610 crore or 115 per cent for the third quarter ended December 2013, from Rs 284 crore reported in the year-ago period. The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 1245: 1347, while 145 scrips remained unchanged. (Provisional)

The BSE Sensex lost 14.24 points or 0.07% to settle at 20669.27. The index touched a high and a low of 20828.68 and 20613.62 respectively. Among the 30-share Sensex, 14 stocks gained, while 16 stocks declined. (Provisional)

The BSE Mid cap indices ended up by 0.16% and Small cap indices ended down by 0.26%. (Provisional)

On the BSE Sectoral front, Capital Goods up by 1.00%, Healthcare up by 0.84%, IT up by 0.60%, Teck up by 0.49% and PSU up by 0.28% were the top gainers, while Metal down by 1.32%, Consumer Durables down by 0.78%, Bankex down by 0.64%, Realty down by 0.50% and Oil & Gas down by 0.18% were the top losers in the space. (Provisional)

The top gainers on the Sensex were Maruti Suzuki up by 7.34%, BHEL up by 4.35%, Hero MotoCorp up by 2.81%, Sun Pharma up by 1.61% and Axis Bank up by 1.60%, while, SSLT down by 2.98%, Tata Steel down by 2.03%, Hindalco Industries down by 1.58%, ICICI Bank down by 1.57% and Bajaj Auto down by 1.54% were the top losers in the index. (Provisional)

Meanwhile, Reserve Bank of India (RBI) has forecasted the Indian economic growth to fall below 5 percent in 2013-14 as the prospects of a pick-up in real GDP growth in the second half of 2013-14 have been dampened by negative growth witnessed in industrial production over two consecutive months. In the previous fiscal, India's economic growth slowed down to a decade low of 5 percent owing to the global slowdown as well as domestic factors such as high inflation and interest rates.

The RBI in its latest Macroeconomic and Monetary Developments report, highlighted that consumption demand would continue to weaken and lackluster capital goods production indicated stalled investment demand. However, giving some respite, it asserted that growth is likely to recover to 5.5 percent in the next financial year and added that there could also be a case of gradual recovery to the 5-6 percent band on the back of fast track implementation of infrastructure projects cleared by the Cabinet Committee on Investments (CCI), global growth recovery and easing inflation.

Referring to country’s external sector, the report said the current account deficit, which widened to all time high of 4.8 percent of GDP in FY13, will ease to 2.5 percent this fiscal. However, the central bank expressed concerns over the coming general elections adding that new government’s commitment to reforms hold the key for the future stability of the market and the rupee.India VIX, a gauge for markets short term expectation of marginally gained 1.80% at 18.04 from its previous close of 17.72 on Tuesday. (Provisional)

The CNX Nifty lost 0.60 points or 0.01% to settle at 6,125.65. The index touched high and low of 6,170.45 and 6,109.80 respectively. Out of the 50 stocks on the Nifty, 27 ended in the green, while 12 ended in the red and one stock remains unchanged.

The major gainers of the Nifty were Maruti Suzuki up 6.96%, BHEL up by 4.23%, BPCL up by 3.68%, Ranbaxy up by 3.46% and Hero MotoCorp up by 2.84%. The key losers were SSLT down by 2.93%, IndusInd Bank down by 2.44%, Bank of Baroda down by 2.19%, Tata Steel down by 2.03% and Bajaj-Auto down by 1.79%. (Provisional)

The European markets were trading in green; France’s CAC 40 was up 0.65%, Germany’s DAX was up 0.89% and UK’s FTSE 100 was up 0.70%.

The Asian markets, barring Straits Times concluded Wednesday’s trade in green as tensions over emerging markets eased. Investors have started eyeing Federal Reserve decision on its stimulus program. Turkey’s central bank aggressively increased overnight lending rate/interest rates at an extraordinary policy meeting billed as a test case for under-pressure emerging markets. The central bank raised its overnight lending rate to 12% from 7.75%, raised its one-week repo rate to 10% from 4.5% and raised its overnight borrowing rate to 8% from 3.5%.

Philippine third-quarter on-year economic growth has been revised down to 6.9% from 7.0% as a result of a slower-than-initially-estimated industry and services sector. GDP growth in the first and second quarters was 7.7% and 7.6%, respectively. South Korean Industrial Production rose to a seasonally adjusted annual rate of 2.6%, from -0.8% in the preceding month whose figure was revised up from -1.3%. Singaporean Unemployment Rate remained unchanged at 1.8%, from 1.8% in the preceding quarter.Taiwan Weighted remained closed for the trade today.