Indian equity benchmarks end marginally higher on Friday

Indian equity benchmarks ended the choppy day of trade slightly in the green on Friday. Frontline gauges traded in the tight-band throughout the session. Though, markets made gap up opening supported by Moody’s Analytics report that projected the ouster of the UPA government after a disappointing second term, saying that the BJP is likely to form the next government after the general elections. Moreover, appreciation in Indian rupee too supported the up-move. The rupee was trading higher at 60.97/98 at the time of equity markets closing versus previous session’s close of 61.34/35.

However, gains remained capped on report that foreign direct investment (FDI) into India grew by a meager 1.5 percent to $2.18 billion in January and for the April-January period; foreign investment inflows dipped 2 percent to $18.74 billion from $19.1 billion during the corresponding period of the previous fiscal. Traders also remained concerned with Reserve Bank Governor Raghuram Rajan’s statement that central bank is yet to move to inflation targeting and is still in discussions with the government on the same; he also reiterated his preference for targeting retail price inflation

On the global front, most of the Asian equity indices ended in the green led by Chinese benchmark, which rose around three percent, most in five months on signs of US economic strength. European markets too were trading in the green in early deals, as investors absorbed concerns about the Federal Reserve, banks and heightened tensions between Russia and the West.

Back home, continuous buying from foreign institutions supported the gains with FIIs buying shares worth a net Rs 722.02 crore on March 20, 2014. Meanwhile, software and technology stocks viz. Infosys, TCS, Wipro and HCL Technologies all edged higher after reports on leading indicators and regional manufacturing fueled optimism in the US economy. Additionally, shares of tyre companies like, Ceat, MRF, Goodyear India, JK Tyre, Apollo Tyres and TVS Srichakra, remained on buyers’ radar on back of heavy volumes. On the flip side, upstream oil companies especially Reliance Industries and ONGC remained under pressure, as the government is yet to notify the new price for domestically produced gas and there might be a delay in the announcement.

The NSE’s 50-share broadly followed index Nifty rose by just over ten to end below its psychological 6,500 level, while Bombay Stock Exchange’s Sensitive Index -- Sensex gained by over thirteen points and managed to end above its psychological 21,750 mark. Broader markets, however, outperformed benchmarks and ended the session with a gain of around a percentage point. The market breadth remained in favour of advances, as there were 1,579 shares on the gaining side against 1,257 shares on the losing side, while 142 shares remained unchanged.

Finally, the BSE Sensex added 13.66 points or 0.06%, to settle at 21753.75, while the CNX Nifty was up by 10.10 points or 0.16% to settle at 6,493.20.

The BSE Sensex touched a high and a low of 21870.11 and 21729.90, respectively. The BSE Mid cap index was up by 0.81%, while the Small cap index gained 0.87%.

The top gainers on the Sensex were Tata Steel up by 3.57%, Hindalco Inds up by 3.10%, Wipro up by 3.09%, Axis Bank up by 2.69% and Tata Motors up by 2.38%, while ONGC down by 2.68%, RIL down by 2.20%, Hero MotoCorp down by 1.94%, Sun Pharma down by 1.68% and NTPC down 1.51% were the top losers in the index.

On the BSE Sectoral front, Metal up by 1.93%, Realty up by 1.86%, Consumer Durables up by 0.70%, Power up by 0.67% and Auto up by 0.65% were the top gainers, while Oil & Gas down 1.88%, PSU down by 0.39%, Healthcare down by 0.24% were the only losers in the space.

Meanwhile, corporates as well as market intermediaries will soon have to pay higher fees to the Securities and Exchange Board of India (SEBI) as the market regulator has approved proposals for a fee hike to fund its programme in investor awareness, education and protection during FY15. Fee revision proposal, which is based on recommendations of the Committee on Rationalisation of Financial Resources (CRFR), is aimed to enhance SEBI's financial resources to help it meet expenses for its various regulatory and investor-centric activities.

CRFR has recommended imposition of fees for various services offered by SEBI to brokers, stock exchanges and mutual funds, among others. Besides, hike in fees is also proposed for consent settlement, informal guidance, documents and takeovers, except for handling investor complaints. Total fee received by SEBI slipped marginally to Rs 149 crore in FY13 as compared to Rs 154.5 crore in the FY12.

Furthermore, as many of its orders are getting challenged in tribunal and courts, SEBI has also planned to recover legal expenses incurred in such litigations from penalties imposed on its defaulters before crediting the same to the government's coffers. Over the past three financial years, capital markets regulator has incurred average litigation expenditure in the range of Rs 4-5 crore per annum, however, such expenses are expected to be much higher in the current fiscal year.

Keeping in view the need to place greater emphasis to achieve the mandated statutory objectives, SEBI identified four core areas for development during the next fiscal year. SEBI’s core activities for FY15 include strengthening investor awareness and education measures, enlarging reach amongst investors through regional and local offices, enhanced focus on capacity building, and raising standards of supervision and enforcement functions in market place such as strengthening market surveillance and investigation functions.

The CNX Nifty touched a high and low of 6,522.90 and 6,485.70 respectively.

The top gainers of the Nifty were Hindalco Industries up by 3.55%, Tata Steel up by 3.47%, Jaiprakash Associates up by 3.08%, Bank of Baroda up by 2.78% and Wipro up by 2.68%. On the other hand, ONGC down by 2.44%, NMDC down by 2.42%, Reliance Industries down by 2.36%, Hero MotoCorp down by 2.03% and IDFC down 1.75% were the top losers.

The European markets were trading in green, France's CAC 40 was up by 0.50%, Germany's DAX was up by 0.56% and United Kingdom's FTSE 100 was up by 0.39%.

The Asian markets barring Taiwan Weighted concluded Friday’s in green as bargain-hunters moved in after the previous session’s heavy losses, with investors taking a lead from Wall Street and a positive batch of US data. Japan’s Nikkei 225 was closed for trading on account of ‘Vernal Equinox Day’ holiday. Hong Kong’s Hang Seng Index concluded the week as one of the world’s worst performing major stock indexes, down 9% so far in 2014. China’s economy slowed this quarter, with industries including retail and mining showing weaker revenue growth while loans through non-traditional channels became more expensive. The report adds to signs that Premier Li Keqiang may face difficulties reaching an expansion target of 7.5% this year without stimulus. The State Council, or cabinet, stated this week that it will speed up construction projects and other measures to support the economy after data showed moderating growth in industrial production and investment.

Goldman Sachs has slashed its 2014 growth outlook for China to 7.3% from 7.6%, citing recent trade and consumption-data disappointments. For 2015, Goldman expects growth of 7.6% versus a prior forecast of 7.8%. Inflation, meanwhile, is seen at 2.6% for 2014, versus a prior view of 3%, while its 2015 outlook on inflation is unchanged at 3%. The Chinese government’s official growth target for 2014 is 7.5%.