Benchmarks magnify losses; slip to day’s low point

Local equity markets magnifying their losses were now trading with cut of close to half a percent, with both Sensex and Nifty languishing below the psychological 22,500 and 6750 levels respectively. Rapidly losing ground, benchmarks were now at day’s low point, with broader indices also showing no diverse trend and trading with losses in the range of 0.15%-0.20%. Profit-booking after six straight session of record setting rally mainly has led to bit of correction at Indian equity markets, which after getting a positive start soon lost ground and were trading in red thereafter.

However, markets could witness some recovery going further in the session on account of mostly positive start of European counterparts ahead of ECB meet. Meanwhile Asian stocks rose for a seventh day in the longest rally this year as the Japanese yen reached a two-month low and China’s government announced stimulus measures.

Closer home, selling was not only aggressive, but also broad-based in nature, with only few sectors like Realty, Healthcare, Consumer Durables and Metal counters witnessing buying. On the flip side, stocks from Capital Goods, Oil & Gas and Banking counters were the weakest links of trade. Meanwhile, sentiment at D-street was also soured after Private sector output in India fell in March, after a fractional increase in the previous month amid moderation in domestic demand conditions as per HSBC survey. The overall market breadth on BSE was in the favour of declines which thumped advances in the ratio of 1156:679; while 26 shares remained unchanged.

The BSE Sensex is currently trading at 22440.17 down by 111.32 points or 0.49% after trading in a range of 22,620.65 and 22419.44. There were 9 stocks advancing against 21 stocks declining on the index.

The broader indices too continued to trade lower; the BSE Mid cap index was down by 0.23%, while Small cap index was down by 0.15%.

The gaining sectoral indices on the BSE were Realty up by 0.98%, Healthcare up by 0.83%, Consumer Durables up by 0.69%, Metal up by 0.57%. While, Capital Goods down by 1.32%, Oil and Gas down by 1.31%, Bankex down by 0.96%, Power down by 0.65% and Auto down by 0.31% were the losing indices on BSE.   

The top gainers on the Sensex were SSLT up by 1.43%, Dr Reddy’s Lab up by 1.29%, Cipla up by 1.14%, Sun Pharma up by 0.75% and NTPC up by 0.61%. On the flip side, BHEL down by 2.73%, Coal India down by 1.93%, ONGC down by 1.82%, L&T down by 1.69% and Gail India down by 1.61%.

Meanwhile, the value of Merger & Acquisition (M&A) deals involving Indian companies increased marginally by 2.8 per cent at $5.2 billion during the first quarter of 2014 from a year earlier, however declined by 27.4 percent as compared to the previous quarter of current fiscal.

The deal count dropped by 29.5 percent to 232 in the reported quarter as compared to 329, which announced during the first quarter of 2013. However, completed M&A deals involving Indian companies recorded at $8.4 billion, which was 37 percent higher as against same quarter of previous year. The average M&A deal size for transactions with disclosed values involving India also increased to $56.3 million during the Jan-Mar 2014 against $34 million over the same period last year.

Further, the domestic M&A stood in the first quarter of 2014 stood at $2.7 billion, up 111.2 per cent compared to the first quarter of 2013. On sector wise, Energy & Power sector recorded 71.3 percent of India’s domestic M&A activity with $1.9 billion, an eleven-fold increase from the same period last year. However, the cross-border M&A fell 38.7 percent to $1.9 billion compared to the first quarter of 2013. The inbound M&A in India declined 49.4 percent, while outbound M&A increased 57.2 per cent over the same period last year.

Merger and acquisitions (M&A) have now become important features of corporate restructuring and plays an important role in the external growth of companies. M&A helps the firms to enhance competition, breaking of trade barriers, free flow of capital across countries and globalisation of businesses

The CNX Nifty is currently trading at 6,721.45, down by 31.10 points or 0.46% after trading in a range of 6,776.75 and 6,711.70. There were 17 stocks advancing against 33 declining on the index.

The top gainers of the Nifty were Jindal Steel up by 3.19%, NMDC up by 2.34%, Asian Paints up by 2.30%, SSLT up by 1.40% and Dr Reddy’s lab up by 1.26%. On the flip side, BHEL down by 2.56%, PNB down by 2.28%, BPCL down by 2.03%, Coal India down by 1.99% and GAIL India down by 1.91% were the major losers on the index.

Asian equity indices were trading in green; Straits Times was up  by 0.76%, Jakarta Composite up by 0.49%, Hang Seng up by 0.15% and Nikkei 225 up by 0.84%. While, Taiwan Weighted was down by 0.19% and Shanghai Composite down by 0.76% were the only losers of the index.