Post Session: Quick Review

Indian markets showed a great piece of resilience on Monday, when all the regional peers remained under pressure and some even lost considerably for the day when the local markets ended at the high points of the day, which was a month’s high as well. The domestic bourses after a soft start moved higher and extending last session’s upmove added another over half a percent for the day.

Earlier, the Asian markets gave a negative cue for the local markets when Chinese shares in the mainland and Hong Kong suffered major plunge on reports of property-lending curbs. The European markets too made a mixed start but were unable to deter the domestic markets in any way.

Back home, the start of the holiday truncated F&O expiry week was on a positive note for the Indian markets and barring few of the sectoral gauges, which remained under pressure due to their individual issues, all other ended in green. The better part of the trade was that the broader indices too equally participated. Though, there was some cautiousness in the trade, after the global rating agency Moody’s pointing that forthcoming elections will delay the reform process and hurt growth, said that it expects growth to pick up to only 5.5 per cent in FY15. The agency also gave a negative outlook for non-financial corporates in 2014 on weak economy, political uncertainty and effects of the tapering by US Fed. Back on street, the weakness in the Chinese market weighed on the metal stocks after the report that some banks curbed loans to developers in the nation. Power sector too remained in limelight, with power distribution companies witnessing a good upsurge, while the producers pummeling down after the Central Electricity Regulatory Commission (CERC), the electricity regulator allowed Tata Power to raise tariffs and receive compensation to make up for losses incurred at its flagship Mundra plant in Gujarat. On the same time, the strength in rupee after the initial weakness, weighed on the IT and Tech sector stocks, taking them marginally in red. There was some scrip specific movements too that caught investors’ attention, especially the twin rating agency stocks ICRA and CARE. While, ICRA surged after Moody's announced a conditional open offer to acquire an additional stake of at least 21.5% in the company, CARE stocks suffered sharp cuts after the company announced that the proposed stake sale by a consortium led by IDBI has been aborted as the bids were not found acceptable.

The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1357: 1297, while 144 scrips remained unchanged. (Provisional)

The BSE Sensex gained 117.01 points or 0.57% to settle at 20817.76. The index touched a high and a low of 20828.63 and 20637.30 respectively. Among the 30-share Sensex, 22 stocks gained, while 8 stocks declined. (Provisional)

The BSE Mid cap and Small cap indices ended higher by 0.27% and 0.21% respectively. (Provisional)

On the BSE Sectoral front, Capital Goods up by 2.49%, Bankex up by 1.36%, Healthcare up by 1.16%, Oil & Gas up by 0.80% and Auto up by 0.64% were the top gainers, while Power down by 1.30%, Metal down by 1.05%, Teck down by 0.43%, IT down by 0.30% and PSU down by 0.15% were the only losers in the space. (Provisional)

The top gainers on the Sensex were Tata Power up by 5.08%, BHEL up by 3.99%, Axis Bank up by 3.80%, L&T up by 2.70% and Dr Reddys Lab up by 2.41%, while, NTPC down by 11.16%,  Bharti Airtel down by 1.73%, Tata Steel down by 1.42%, TCS down by 1.32% and SSLT down by 0.97% were the top losers in the index. (Provisional)

Meanwhile, in order to align the country with the global financial standards, India will adopt international financial standards from April 2015 for companies with a net worth of more than Rs 1,000 crore. Indian corporate affairs ministry is likely to notify soon all sections and rules of the new Companies Act to converge Indian Accounting Standards (IAS) with the International Financial Reporting Standards (IFRS). The Institute of Chartered Accountants of India (ICAI), the accounting regulator had submitted revised road map to corporate affairs ministry for the implementation of IFRS from next April.

It has become imperative for India to adopt IFRS which has already been implemented by 130 countries. The IFRS mandates extensive disclosures and is considered a more credible tool for accounting. In the first phase, IFRS will be implemented by large-sized companies having net worth of over Rs 1,000 crore. Meanwhile, during the second phase that will begin from April 1, 2016 will involve both listed and unlisted companies with a net worth of over Rs 500 crore but less than Rs 1,000 crore. The implementation of IFRS is expected to put significant impact on all sectors, especially banking and real estate. Further, the new accounting standards will help the investors for making mark-to-market projections and valuation of financial assets, among other things.

However, industry bodies such as Assocham, Ficci and CII had sought postponement of implementation of IFRS arguing that the companies needed more time to adopt the global standards. At present, Indian companies doing business abroad and listed overseas prepare financial statements as per international standards.

India VIX, a gauge for markets short term expectation of volatility gained 2.26% at 14.35 from its previous close of 14.03 on Friday. (Provisional)

The CNX Nifty gained 31.15 points or 0.51% to settle at 6,186.60. The index touched high and low of 6,191.85 and 6,130.80 respectively. Out of the 50 stocks on the Nifty, 34 ended in the green, while 15 ended in the red and one stock remains unchanged.

The major gainers of the Nifty were Tata Power up 5.20%, BHEL up by 4.05%, Axis Bank up by 3.62%, Ranbaxy up by 2.95% and L&T up by 2.59%. The key losers were NTPC down by 11.48%, Bharti Airtel down by 1.75%, Tata Steel down by 1.36%, NMDC down by 1.28% and TCS down by 1.26%. (Provisional)

Most of the European markets were trading in red; UK’s FTSE 100 down by 0.39% and France’s CAC 40 was down 0.09%, while Germany’s DAX was up by 0.13%.

The Asian markets barring Straits Times concluded Monday’s trade in red, with Japan’s Nikkei average easing from a three-week high in an erratic session as a firmer yen and weak Asian markets triggered profit-taking following recent sharp gains. Many investors stayed on the sidelines looking for clearer signs of improvement in Japanese corporate earnings, giving no more than a passing nod to the Group of 20’s latest commitment to spur faster global growth. Taiwanese Industrial Production fell to a seasonally adjusted annual rate of -1.78%, from 5.07% in the preceding month.

The rate of increase in China’s new home prices eased in January, pointing to more stabilization in the country’s property market. Average new home prices in China’s 70 major cities climbed 9.6% in January from a year earlier, easing from December’s 9.9% rise. It was the first time in 14 months that the country’s home price rises eased, and the most recent sign that the government’s four-year-plus campaign to rein in property risk may finally be working.