Reversal of trend which took place during the second half of trading session eroded all the early gains at Dalal Street, leading to dismal performance of benchmarks for third successive session on Wednesday. Concerns over foreign institutional investors (FII’s)’s sell-off after data showed that overseas investors sold Indian shares worth of Rs 216.3 million ($3.59 million) on Tuesday -- the second straight session of outflows, led to some jitters across Indian equity markets. Nothing practically could salvage the sentiments at Dalal Street, not even positive IndusInd Bank Q4 results and positive global counterparts. By close of trade, both Sensex and Nifty lost about one percent and ended below the crucial 22,300 and 6,700 levels respectively. Meanwhile, broader indices too following suite, succumbed to profit-booking and ended with colossal losses of over a percent.
On the global front, Asian share markets were mostly in the black on Wednesday after China reported economic growth a touch above forecast, a relief for investors who had feared a much weaker outcome. China's economy grew 7.4 percent in the first quarter, from a year earlier, beating forecasts of 7.3 percent. That was welcome news to many investors given foreboding whispers that growth would be nearer 7.0 percent following a string of soft numbers recently. Additionally, European shares rose early on Wednesday, reversing the previous session's losses as data showed economic growth in China a touch above forecasts, while gains in Tesco also lifted markets.
Closer home, while selling was broad-based, losses at Dalal Street were led by stocks from Information Technology (IT), Technology and Power counters, which were battered down cruelly in trade. On the flip side, stocks from Metal and Fast Moving Consumer Goods (FMCG) counters were the only saving grace for the session. While, good macro-economic data from China, world’ largest metal consumer, bolstered metal stocks, defensive play lifted FMCG stocks. However, cautiousness ahead of TCS and HCL Technologies result weighed on IT stocks. Meanwhile, sentiment remained downbeat for banking counter, which ended lower despite good Q4 earnings of IndusInd Bank. The bank beat street’s forecast by reporting net profit at Rs 396 crore in the quarter ended March 2014, up 29 percent compared to a year-ago period supported by other income. Besides, telecom stocks rang loud in the session after Reliance Communication announced a hike tariffs by up to 20 per cent for all its pre-paid customers, too lost steam by close of trade. Moreover, Adani group stocks, vis-a-vis, Adani Enterprises and Adani Port and Special Economic Zone, once again turned out to be investors’ darling for the session. The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 1088: 1651, while 133 scrips remained unchanged. (Provisional)
The BSE Sensex lost 207.70 points or 0.92% to settle at 22277.23. The index touched a high and a low of 22533.61 and 22247.39 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 1.08% and 1.11% respectively. (Provisional)
On the BSE Sectoral front, FMCG up by 0.63% and Metal up by 0.19%, were the only gainers, while Realty down by 3.87%, IT down by 2.49%, Capital Goods down by 2.47%, Teck down by 2.14% and Power down by 1.86% were the top losers in the space. (Provisional)
The top gainers on the Sensex were Tata Steel up by 1.55%, ITC up by 1.32%, Hindalco up by 1.19%, Maruti Suzuki up by 0.61% and Tata Motors up by 0.25%, while, Tata Power down by 3.55%, BHEL down by 3.28%, Infosys down by 3.08%, L&T down by 2.91% and Wipro down by 2.89% were the top losers in the index. (Provisional)
Meanwhile, questioning the assumptions that worst is over for Asia's third-largest economy, the provisional annual inflation rate based on all India general Consumer Price Index (CPI) (Combined) disappointed the street by accelerating to 8.31% from 25 months low level of 8.10% in February. However, in a bit of surprise, February Inflation was revised downwards to 8.03% v/s 8.10% earlier.
According to the data, CPI numbers of February 2014 for Rural, Urban and Combined stood at 139.7, 136.0 and 138.1 respectively. The corresponding provisional inflation rates for rural and urban areas for March 2014 stood at 8.89% and 7.51%, while inflation rates (final) for rural and urban areas for February 2014 stood at 8.43% and 7.55%respectively.
Food prices for consumers rose at 9.10% in last month from a year earlier, higher than February’s 8.57% rise. The Provisional annual inflation rates of February 2014 for Rural and Urban in respect of ‘food and beverages’ stood at 9.95% and 7.47% for month under review compared to 9.27% and 7.10% respectively in February, 2014. Additionally, Provisional annual inflation rates (Combined) for Fuel and light; Clothing, bedding and footwear stood at 6.29% and 9.03% respectively for the month of March.
Offering a bit of relief, core consumer price index (CPI) rose by 7.8% in March from a year earlier, easing from a 7.9% in February. This is a positive since core inflation for the past few months has been stuck at around 8 per cent, a level Reserve Bank of India’s (RBI) chief Raghuram Rajan deems uncomfortably high.
However, latest reading adds to woes of policy makers, which are struggling with sluggish economic growth on one hand and higher inflation on the other. India has been battling a prolonged spell of high inflation and low growth. While economic growth has almost halved to below 5 percent for the past two years, the worst slowdown for the South Asian nation since the 1980s.
India VIX, a gauge for markets short term expectation of volatility lost 2.24% at 31.16 from its previous close of 31.87 on Tuesday. (Provisional)
The CNX Nifty lost 59.10 points or 0.88% to settle at 6,674.00. The index touched high and low of 6,748.65 and 6,665.15 respectively. Out of the 50 stocks on the Nifty, 15 ended in the green, while 34 ended in the red and one stock remain unchanged.
The major gainers of the Nifty were ITC up 1.57%, Hindalco up by 1.38%, Lupin up by 1.26%, Bank of Baroda up by 1.12% and Jindal Steel up by 0.97%.
The key losers were DLF down by 4.87%, BHEL down by 3.60%, Tata Power down by 3.54%, Infosys down by 3.00% and L&T down by 2.92%. (Provisional)
European markets were trading in green; France’s CAC 40 was up 0.86%, UK’s FTSE 100 was up 0.29% and Germany’s DAX was up by 0.75%.
The Asian markets concluded Wednesday’s trade mostly in green with Japan’s Nikkei jumping as bargain buying and a weaker yen lifted the market, following a rise on Wall Street bolstered by strong US corporate earnings. Bank Indonesia deputy governor Halim Alamsyah stated that Indonesia will have a chance to ease monetary policy next year as inflation slows, after maintaining a tight stance in 2014. Inflationary pressures are easing after interest rates were raised last year. He added that consumer-price gains will probably slow to about 5% by the end of this year and less than 4.5% in 2015. Japan’s industrial production fell to a seasonally adjusted -2.3%.
China’s economy grew at its slowest pace in six quarters in the first quarter of 2014 with signs of waning momentum already prompting limited government action to steady the world’s second-largest economy. China’s annual economic growth slowed between January and March 2014 to 7.4% from 7.7% in the previous three months while Chinese Industrial Production rose to 8.8%, from 8.6% in the preceding month. Chinese Retail Sales rose to an annual rate of 12.2%, from 11.8% in the preceding month while Chinese Fixed Asset Investment fell to a seasonally adjusted 17.6%, from 17.9% in the preceding month.
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Wednesday 16 April 2014
Post Session: Quick Review
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