Post Session: Quick Review

Indian equity markets gave thumbs up to ‘Interim-Budget 2014-15’, whereby Finance Minister P. Chidambaram presented a rosy picture of the economy, in which he bettered his 4.8% fiscal deficit target for the current fiscal year to 4.6%, revised current year GDP growth to 4.9% and lowered gross borrowing target for the coming financial year. Late hour buying mainly aided the markets register gains of close to half a percent and end past the psychological 20,500 (Sensex) and 6,050 (Nifty) levels respectively. Markets in the volatile session of trade, though for couple of times slipped in negative territory, but only to bounce-back with vengeance. However, the session failed to bring cheer for broader indices, which ended on a mixed note, with midcap index showing a degree of underperformance and ending with a cut of over two tenths of a percent.

On the global front, Asian stock markets rose on Monday, taking their lead from strong gains on Wall Street despite weaker-than-expected Japanese growth figures. Data released Monday showed Japan’s economy expanded 1.6 per cent last year, in the first annual figures since Prime Minister Shinzo Abe launched a policy blitz dubbed Abenomics. Additionally, European stocks inched higher in early trade on Monday, extending a two-week rally and tracking gains in Asia as worries over emerging markets eased.

Closer home, the gains at Indian equity markets were led by stocks belonging to banking, Healthcare, Power and Auto sector. Banking stocks, barring PSUs, gained after the Finance Minister P Chidambaram in the interim budget today said that GDP growth in the last two quarters of the current fiscal will be at least 5.2%. While, Auto stock got a boost from excise duty cut for the sector, as FM in the interim budget proposed to cut excise duty to 8% from 12% for small car, Motorcycle, Scooters; and slashed it to 24% from 30% for SUVs. Additionally, power stocks were in demand after activist-turned-politician Arvind Kejriwal resigned as chief minister of Delhi on Friday, frustrated by obstacles put in the way of an anti-corruption bill. Kejriwal was appointed in part on a promise of lowering electricity tariffs for millions of Delhi's voters and in December had asked the state auditor to look into the accounts of power distribution companies to see if they were profiteering. On the flip side, Realty, Consumer Durables and Oil & Gas sectors were the top laggards. 2 percent excise duty cut on consumer durables was although a way forward to support demand and fuel growth in consumer durable sector, but it was too little to create an impact. Additionally, PSU banks fell after Finance Minister P Chidambaram, in the interim budget for FY14-15, proposed lower capital infusion of Rs 11,200 crore in public sector banks in the next financial year, which was lower than the amount that the government infused in the previous year. The government infused Rs 14,000 crore in various public sector banks in this financial year. Besides, Shares of jewellery companies tanked as interim budget, announced by the Finance Minister P.Chidambaram on Monday failed to give any sops to the sector. Most of these stocks were trading in green in early morning deals on expectations of a relaxation of the gold import norms, including the 80:20 rule.The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 1246: 1361, while 158 scrips remained unchanged. (Provisional)

The BSE Sensex gained 110.19 points or 0.54% to settle at 20477.01. The index touched a high and a low of 20492.43 and 20338.95 respectively. Among the 30-share Sensex, 20 stocks gained, while 9 stocks declined and one stock remains unchanged. (Provisional)

The BSE Mid cap index ended lower by 0.14% and Small cap index ended higher by 0.04%. (Provisional)

On the BSE Sectoral front, Bankex up by 1.43%, Power up by 1.12%, Auto up by 0.97%, Healthcare up by 0.76% and Capital Goods up by 0.25% were the top gainers, while Realty down by 0.82%, Consumer Durables down by 0.72%, Oil & Gas down by 0.52%, Metal down by 0.51% and PSU down by 0.34% were the only losers in the space. (Provisional)

The top gainers on the Sensex were Tata Power up by 4.74%, Mahindra & Mahindra up by 3.70%, Dr Reddys Lab up by 2.45%, ICICI Bank up by 2.43% and Hero MotoCorp up by 2.34%, while, Coal India down by 1.71%, RIL down by 1.16%, Hindalco down by 1.05%, BHEL down by 0.81% and Sun Pharma down by 0.45% were the top losers in the index. (Provisional)

Meanwhile, thwarting hopes of any early easing in restrictions to the gold imports, the Reserve Bank of India (RBI) has barred nominated banks and agencies from importing the precious metal in excess of their entitlements in first or second lot under the 80:20 schemes. As per RBI’s latest notification, import of gold in the third lot onwards should be lesser of the two-five times the export for which proof has been submitted or quantity of gold permitted to a nominated agency in the first or second lot.

Previously, the government under the 80:20 scheme in August 14, 2013, allowed nominated agencies to import gold, provided that 20 per cent of the inward shipment will be exported and the permission to import the next lot was granted only on the fulfillment of these export obligations.

However, in case of advance authorization (AA) and duty free authorization (DFIA) for gold import issued before August 14, 2013, RBI underscored that the 80:20 rule was not applicable for units in Special Economic Zones (SEZs), Export Oriented Units (EoUs), Premier and Star Trading Houses.

Earlier, the government in order to contain rising gold import, had hiked import duty on gold thrice in 2013 to a total of 10%. While, the RBI rolled out certain restrictions, including the 80:20 scheme for imports.

India VIX, a gauge for markets short term expectation of volatility, lost 6.44% at 17.43 from its previous close of 18.63 on Tuesday. (Provisional)

The CNX Nifty gained 30.75 points or 0.51% to settle at 6,079.10. The index touched high and low of 6,080.65 and 6,038.30 respectively. Out of the 50 stocks on the Nifty, 28 ended in the green, while 21 ended in the red and one stock remains unchanged.

The major gainers of the Nifty were Tata Power up 4.60%, M&M up by 3.27%, Dr Reddys Lab up by 2.59%, ICICI Bank up by 2.38% and Hero MotoCorp up by 1.95%. The key losers were NMDC down by 5.05%, Coal India down by 1.78%, DLF down by 1.72%, Hindalco down by 1.15% and Reliance Industries down by 1.13%. (Provisional)

Most of the European markets were trading in green; Germany’s DAX up by 0.03%, UK’s FTSE 100 up by 0.83% and France’s CAC 40 was up 0.07%.

The Asian markets concluded Monday's trade in green, with markets in Japan moving higher despite data showing that the nation’s economy grew less-than-expected in the fourth quarter. Japanese markets gained ground despite a stronger yen amid soft growth data. The Cabinet Office stated that Japan's GDP increased by 0.3 percent in the fourth quarter of 2013 on a quarterly basis. Expanding for the fourth straight quarter, the GDP growth missed forecasts for an increase of 0.7 percent following the 0.3 percent gain in the third quarter.

The record new credit in China bolstered confidence in the world’s second-largest economy. China's equity market rose with the benchmark index erasing this year’s losses, after record new credit in January easing concern that the Chinese economy will slow. According to the data released by the People's Bank of China, the bank lending surged to a four-year high in January, setting off alarm bells as Beijing tries to achieve a delicate balance between maintaining growth and managing risk.