Post Session: Quick Review

Expiry session of February series futures and options (F&O) turned out to be steady session of trade for Indian equity markets, which gradually gaining ground concluded near day’s high point, with both Sensex and Nifty, clocking gains of over half a percent and ending above the crucial 20,950 and 6,200 levels respectively. Meanwhile, broader indices ended the session in green, albeit with slender. For the series, while Nifty and Sensex rallied over 2% each, in broader space, CNX Midcap index added massive 4.6%, with BSE Small-cap index creeping higher by 4%.

Markets gained ground on stable foreign investor flows in the absence of any major cues before Q3 GDP data due on Friday. India's economic growth likely slowed to a near decade-low at the end of last year as high interest rates hit factory activity. Street widely expects Asia's third-largest economy likely grew at 4.9 percent over a year ago in the three months to December, similar to the 4.8 percent rate in the previous quarter.

On the global front, Asian pacific shares ended mostly lower as concerns over opaque policy moves in China kept investors on edge amid a drought of major economic data. Additionally, European shares edged lower on Wednesday, weighed by weakness in Credit Suisse that helped stall the advance of a leading regional index to a fresh near 6-year high.

Closer home, most of the sectoral indices on BSE concluded in green, barring Realty and Metal counters. Nevertheless, investors’ darlings for the session were stocks belonging to FMCG, Auto and Healthcare counters. Additionally, software stocks ended upbeat for yet another session on continued optimism about US business outlook. Meanwhile, fertilizer stocks ended mixed ahead of CCEA meet on Friday. The Cabinet Committee on Economic Affairs (CCEA) in its meeting is expected to consider increasing the fixed cost for urea plants and amend the new investment policy (NIP 2012) soon. The proposal to increase fixed cost although would not entail any increase in the retail prices of urea. However, this would increase government’s subsidy burden by around Rs 900 crore.  The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1,356: 1,336, while 149 scrips remained unchanged. (Provisional)

The BSE Sensex gained 108.42 points or 0.52% to settle at 20,960.89. The index touched a high and a low of 21,005.04 and 20,860.02 respectively. Among the 30-share Sensex, 21 stocks gained, while 9 stocks declined. (Provisional)

The BSE Mid cap and Small cap indices ended higher by 0.04% and 0.31% respectively. (Provisional)

On the BSE Sectoral front, FMCG up by 0.99%, Auto up by 0.94%, Healthcare up by 0.89%, Capital Goods up by 0.85% and Oil & Gas up by 0.51% were the top gainers, while Metal down by 1.78% and Realty down by 0.43% were the top losers in the space. (Provisional)

The top gainers on the Sensex were Gail India up by 2.92%, Mahindra & Mahindra up by 1.96%, Dr Reddys Lab up by 1.77%, Sun Pharma up by 1.69% and ITC up by 1.62%, while, Tata Steel down by 3.24%, SSLT down by 2.48%, Tata Power down by 2.35%, Coal India down by 1.12% and Maruti Suzuki down by 0.64% were the top losers in the index. (Provisional)

Meanwhile, private Equity (PE) investment in India increased by 74 percent to $2.12 billion in 76 deals during the last quarter of 2013 as compared to $1.22 billion from 109 deals recorded in the same period a year ago. According to a PricewaterhouseCoopers (PwC) MoneyTree India report, a quarterly study of private equity investment activity based on data provided by Venture Intelligence, the PE investment in reported quarter was highest since 2007 despite a 30 percent fall in the volume of deals. However, PE exits doubled with an exit value of $1.13 billion from 20 deals during Q4’2013. The PE investment value was recorded at $1.78 billion in Q3’2013.

On sector wise PE investment, Information technology-enabled services (ITeS) sector was the most active in terms of value and volume with 37 deals worth $959 million in the fourth quarter of calendar year 2013. Furthermore, the sector has shown a 41% increase in value with two additional deals in quarter under review as compared to previous one. Around 80 percent of the deal value was recorded in IT and healthcare space, while, activity levels in other sectors were largely muted. The healthcare and life sciences sector witnessed a surge of almost four times in investments value from $191 million in the previous quarter to $729 million in Q4’2013.

Further, PwC expects that momentum witnessed in Q4 will continue to remain in early 2014 and IT, ITeS and pharmaceuticals will continue to attract investments given their strong export focus, particularly against a depreciating rupee.

Private equity capital is not quoted on a public exchange and consists of investors and funds that make investments directly into private companies or conduct buyouts of public companies that result in a delisting of public equity. The majority of private equity consists of institutional investors and accredited investors who can commit large sums of money for long periods of time.

India VIX, a gauge for markets short term expectation has ended flat with positive note at 13.95 on Wednesday. (Provisional)The CNX Nifty gained 39.30 points or 0.63% to settle at 6,239.35. The index touched high and low of 6,245.95 and 6,202.10 respectively. Out of the 50 stocks on the Nifty, 32 ended in the green, while 18 ended in the red.

The major gainers of the Nifty were Gail up 3.62%, M&M up by 2.34%, ITC up by 2.14%, Sun Pharma up by 1.85% and BHEL up by 1.82%. The key losers were NMDC down by 3.57%, Tata Steel down by 3.13%, SSLT down by 2.34%, Tata Power down by 2.22% and IndusInd Bank down by 1.40%. (Provisional)

The European markets were trading in red; France’s CAC 40 was down 0.27%, Germany’s DAX was down 0.24% and UK’s FTSE 100 dropped 0.39%.

The Asian markets concluded Wednesday’s trade on a mixed note, with Japan’s Nikkei average closing in red after hitting a four-week closing high the previous day, as investors took profits after weak US economic data soured sentiment. China’s credit-market gauges are triggering alarm bells, as banks grow cautious in lending to each other while investors prefer the safest government bonds. Foreign Direct Investment in Shanghai rose 10.5% in January from a year earlier to $1.093 billion, consistent with last year’s annual pace but slower than the national average of 16% for the month.

In Hong Kong, the Financial Secretary John Tsang has predicted GDP growth of 3% to 4%, and headline and underlying inflation of 4.6% and 3.7%. The country’s economy grew 2.9% last year, a marked improvement over the 1.5% growth seen in 2012. Hong Kong GDP rose to a seasonally adjusted annual rate of 1.1%, from 0.5% in the preceding quarter. Singaporean Industrial Production fell to an annual rate of 3.9%, from 6.2% in the preceding month while South Korean Consumer Confidence fell to 108, from 109 in the preceding month.