1. Metal stocks drag Sensex to end 286 points down, Nifty settles at 7,455; RBI maintains status quo

Metal stocks drag Sensex to end 286 points down, Nifty settles at 7,455; RBI maintains status quo

Benchmark indices BSE Sensex and NSE Nifty tumbled over 1 per cent on Tuesday on account of selling in metal, oil and gas, healthcare and power stocks amid global market sell-off.

By: | Updated: February 2, 2016 4:34 PM
BSE Sensex, NSE Nifty

Benchmark indices BSE Sensex and NSE Nifty tumbled over 1 per cent on Tuesday on account of selling in metal, oil and gas, healthcare and power stocks amid global market sell-off. (PTI)

Benchmark indices BSE Sensex and NSE Nifty tumbled over 1 per cent on Tuesday on account of selling in metal, oil and gas, healthcare and power stocks amid global market sell-off. The sentiments were also affected after the Reserve Bank of India (RBI) kept its key policy rates unchanged, opting to wait for the government’s annual budget statement at the end of February for  further easing.

The BSE Sensex closed 285.83 points down at 24539, while the NSE Nifty settled 100.40 points down at 7,455.55.

In the 30-share index, Tata Steel, NTPC, BHEL, Cipla and Sun Pharma slid between 3.50 per cent and 8 per cent. On the other hand, Bharti Airtel and Bajaj Auto gained 2 per cent and 1.5 per cent, respectively.

Sectorwise, the BSE Metal index slid the most 4.33 per cent, followed by Oil & Gas index (down 2.59 per cent), Healthcare index (down 2.46 per cent) and Power index (down 2.42 per cent). The BSE Telecom index (up 0.41 per cent) remained the only sectoral gainer on Tuesday.

Vinod Nair, Head, fundamental research, Geojit BNP Paribas Financial Services, said, “RBI maintained the status quo while waiting to understand the influence of the budget on retail inflation which is currently near the target of 5.8 per cent in march-2017. The market was largely digesting the announcement which was wide in-line expectation. But a slip in the European market due to fall in crude prices has impacted Indian equities. Globally investors are shunning risky assets like oil, equities and commodities.”

Depreciation in Indian rupee too weighed down sentiments. The rupee depreciated by 12 paise to trade at 67.96 against the US dollar at the time of equity markets closing. Sentiments also remained dampened with Moody’s Investors Service’s report that RBI’s target to bring down retail inflation at 5 per cent by March 2017 will face some risks from monsoon uncertainty and execution of 7th Pay Panel recommendations, while macro-economic factors will be critical for sustaining growth.

Market breadth for the day remained negative and advances to declines ratio for Nifty stood at 7:43 for the day. Volumes for Nifty stocks stood at 2,372 lakh, slightly higher than Monday’s volumes of 2,066 lakh for Nifty stocks.

Asian equity markets ended mostly in red on Tuesday after US crude oil prices fell as much as 7 per cent on Monday, pressured by weak manufacturing reports, a US forecast calling for warm weather through mid-February and doubts about the possibility of a coordinated cutback on production. Factory activity in the world’s two biggest economies – the United States and China – slowed in January, a discouraging trend for the global economy.

Japanese shares slipped on Tuesday as investors locked in profits from large gains made following the Bank of Japan’s surprise decision late last week to adopt negative interest rates. However, Chinese shares bucked the weak sentiment across the region after the People’s Bank of China guided the yuan to its highest fix in almost a month and pumped more money into the financial system to avoid a possible cash crunch ahead of next week’s Lunar New Year holidays.

Asian Indices Last Trade              Change in Points Change in %   
Shanghai Composite 2,749.57 60.72 2.26
Hang Seng 19,446.84 -148.66 -0.76
Jakarta Composite 4,587.44 -37.2 -0.8
KLSE Composite 1,653.18 -14.62 -0.88
Nikkei 225 17,750.68 -114.55 -0.64
Straits Times 2,579.23 -23.18 -0.89
KOSPI Composite 1,906.60 -18.22 -0.95
Taiwan Weighted 8,131.24 -25.72 -0.32

Data Source: Ace Equity

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Markets through the day

3.30 pm: The BSE Sensex closed 285.83 points down at 24,539, while the NSE Nifty settled 100.40 points down at 7,455.55.

3.13 pm: The BSE Sensex and NSE Nifty fell over 1 per cent in the late afternoon session on account of selling in front line blue chip counters. Sensex was down 310 points at 24,514. Nifty was down 107.95 points 7,448.

3.09 pm: The RBI in its sixth bi-monthly monetary policy also pointed out that there is an increase in the level of stalled projects in the economy, which is certainly a cause for concern. Sensex plunged further and was trading 254 points down at 24,570. Nifty was down 87.60 points at 7,468. IndiGo shares were trading 4.78 per cent down at Rs 841.25.

2.52 pm: Amara Raja Batteries reported 33.07 per cent rise in its net profit at Rs 136.18 crore for the quarter ended December 31, 2015 as compared to Rs 102.34 crore for the same quarter in the previous year. The company’s total income increased by 15.43 per cent to Rs 1,236.45 crore for the quarter under review from Rs 1,071.15 crore for the corresponding quarter of the previous year. Shares of Amara Raja Batteries were trading 2 per cent down at Rs 858.80.

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2.40 pm: Sensex was down 112.01 points at 24,712.82. Nifty was down 45.90 points at 7,510.05. European equities fell sharply on Tuesday as crude oil prices slipped again on oversupply concerns and companies such as oil major BP disappointed on the earnings front.

2.13 pm: Tech Mahindra shares slid over 4 per cent after the software exporter on Monday posted a 5.7 per cent decline in consolidated net profit figures for the quarter ended December 2015. The company posted net profit of Rs 805.30 crore in the corresponding quarter a year ago. Bottom line of the company fell 3.36 per cent on quarter-on-quarter basis. Sensex was down 122 points at 24,702. Nifty was down 50 points at 7,506.

1.43 pm: Sensex was down 61 points at 24,763. Nifty was down 26 points at 7,530.

1.19 pm: After gaining over 100 points post RBI monetary policy review, the BSE Sensex pared all of its gains and was trading 33 points down at 24,792. Nifty was trading 18.20 points down at 7,537.

1.07 pm: Homegrown auto major Mahindra & Mahindra on Tuesday said it has completed sale of its entire 71.19 per cent stake in Swaraj Automotives Ltd (SAL) for Rs 24.84 crore to b4S Solutions. Shares of Mahindra & Mahindra were trading 0.32 per cent down at Rs 1223. Sensex was down 4 points at 24,820. Nifty was down 9.55 points at 7,546.

12.40 pm: Crude oil futures traded lower on MCX as speculators cut down their bets amid weak cues from the Asian markets on worries about top energy consumer China on the back of weak economic data, which showed China’s purchasing managers index dropped to a three-year low in January, and on realisation that a hoped-for deal among producers to cut output would not happen.

The contract for February delivery was trading at Rs 2,122, down by 1.44 per cent or Rs 31 from its previous closing of Rs 2,153. The open interest of the contract stood at 42,465 lots.

The contract for March delivery was trading at Rs 2252, down by 1.14 per cent or Rs 26 from its previous closing of Rs 2,278. The open interest of the contract stood at 3,390 lots on MCX.

12.48 pm: On the global front, Asian markets were trading mostly in red at this point of time, as crude oil prices slid on rekindled oversupply fears and after downbeat manufacturing data raised concerns about sluggish global economic growth. Closer home, Banking shares mainly public sector undertakings (PSU) were trading in green and erasing their losses after the Reserve Bank of India (RBI) kept its key policy rate unchanged in its sixth bi-monthly monetary policy review. The broader indices too were trading with traction, while the market breadth on the BSE was positive; there were 1,223 shares on the gaining side against 1,112 shares on the losing side while 106 shares remain unchanged.

12.28 pm: TeamLease Services has finalised the allocation of 22,38,498 Equity Shares at Rs 850 per share (upper end of the price band) aggregating to Rs 190.28 crore to 15 anchor investors.

12.14 pm: Meanwhile, Jay Shankar, Chief India Economist & Director, Religare Capital Market, said, “The RBI believes that the current momentum of economic growth is reasonable, though below what should be expected over the medium term. The upside risks to inflation comes from implementation of the Seventh Central Pay Commission as well as various state pay commissions. As per our estimate, the Pay Commission implementation by the Centre and state govts would lead to a $50bn fiscal stimulus over the next two years. The downside risks emanate from softer global commodity prices and a normal monsoon. However, the RBI would like to wait and watch as these factors play out over the next few months before being in a position to recalibrate the glide path of inflation and respond accordingly. We believe that the upside risks are marginally higher than the downside risks as of now, and hence we do not see any policy rate cuts in FY17.”

12.03 pm: Sensex was up 103 points at 24,928. Punjab National Bank (up 2.61 per cent) and Bank of Baroda (2.45 per cent) were among top gainers in the Nifty 50 index. Nifty was up 16.50 points at 7,572.

11.56 am: Benchmark indices in green. Sensex was up 53 points at 24878, while Nifty was up 7.15 points at 7,563. Nifty Bank was up 0.32 per cent at at 15,363.35.

11.52 am: On the RBI monetary policy, Murthy Nagarajan , Head-Fixed Income ,Quantum AMC, said, “RBI as expected has kept the policy rates unchanged. It has maintained its accommodative stance to facilitate pass through of repo rate cuts in the economy. The market is expected to be well bid due to expectation of open market operations. If the government’s budget looks to boost growth through reforms and keeping spending under check, we expect an inter-meeting cut post the Budget – 25, maybe even 50. RBI focus is now on achieving its 5 per cent inflation target, the 50 basis points cut could help to stimulate the economy as CPI inflation is expected to be remain benign. Although, RBI will not expressly state its desire to conduct OMOS, we believe there would be some more OMOs to cover the core liquidity deficit (adjusted for government balance).”

11.44 am: Midcap and smallcap stocks turned positive. The BSE Midcap index and BSE Small index were up 0.05 per cent and 0.12 per cent, respectively.

11.42 am: Vidli Restaurants is coming out with an initial public offering (IPO) of 13,10,000 equity shares of face value of Rs 10 each for cash at a fixed price of Rs 10 per equity share. The issue will open on February 3, 2016 and will close on February 5, 2016. The shares will be listed on SME platform of BSE. The share is priced at par to its face value of Rs 10. Book running lead manager to the issue is Pantomath Capital Advisors, while the compliance officer for the issue is Payal Barai. Vidli Restaurants is engaged in the hospitality business and runs chain of restaurants either through own operated outlets or through franchisee operated outlets. Sensex was down 40 points at 24,785.

11.22 am: Bearish commodity price dynamics are also likely to impact investor sentiment, RBI said in a release. Sensex was down 69 points at 24754. Nifty was down 33 points at 7,522. Rate sensitive, the BSE Bankex was down by 0.56 per cent.

11.18 am: The first bi-monthly monetary policy statement for 2016-17 will be announced on Tuesday, April 5, 2016.

11.12 am: Nifty was down 19.65 points, or 0.26 per cent, 7,536.30. Having cut the policy repo rate by 125 basis points in 2015, Reserve Bank of India Governor Raghuram Rajan warned on Friday against straying from the path of fiscal consolidation or relaxing the fight against inflation. Rajan, in his statement on Tuesday, said the central bank would stay “accommodative” but would look forward to the government’s budget on Feb. 29, saying it needed to be one that supports growth and controls spending.

11.01 am: Sensex was down 42 points at 24,782. RBI kept CRR unchanged at 4 per cent.

11.00 am: In line with expectations, the Reserve Bank of India (RBI) on Tuesday maintained status quo on key interest rates in its sixth bi-monthly monetary policy review. RBI kept repo rate unchanged at 6.75 per cent. Sensex was down 29.57 points at 24,795.

10.38 am: Tata Motors continued to witness year-on-year growth in the M&HCV segment in January 2016, with a growth of 30 per cent. Total sales of Tata Motors passenger and commercial vehicles (including exports) were at 47,034 vehicles, higher by 10 per cent, over 42,595 vehicles, sold in January 2015. The domestic sale of Tata commercial and passenger vehicles for January 2016 were at 41,398 vehicles higher by 7 per cent over 38,634 vehicles sold in January 2015. Sensex was up 30 points at 24,856.

10.13 am: Brokers said besides a mixed trend at other Asian bourses, selective buying by funds and retail investors ahead of RBI’s monetary policy to be announced later in the day, influenced the sentiment. Sensex was up 33 points at 24,858.

10.04 am: Staffing firm TeamLease Services initial public offer (IPO) hit primary market on Tuesday (February 2). The company has fixed Rs 785-850 per share as the price band for its IPO. The company is expected to garner Rs 424 crore at the upper end of the price band. The issue will close on February 4. READ: TeamLease Services IPO hit markets: 10 points to know before subscribing

9.53 am: In the 50-share index, Adani Ports, YES Bank, Ambuja Cements, Bharti Airtel and Coal India were up between 2.36 per cent and 3.95 per cent. On the other hand, ICICI Bank, State Bank of India, Maruti Suzuki, Bank of Baroda and Axis Bank were down between 2.24 per cent and 5.64 per cent. Nifty50 index was up 8.10 points at 7,564.

9.29 am: The rupee edged higher by 6 paise to 67.78 against the dollar in early trade on Tuesday on fresh selling of the American currency by exporters and banks ahead of the RBI policy meet. Sensex was up 39 points at 24,864.

9.26 am: Shares of Nitta Gelatin India hit upper circuit in the early trade. The scrip jumped 20 per cent to Rs 201.10. The company posted 3229.17 per cent year-on-year rise in its net profit figures to Rs 7.51 crore. The company posted net loss of Rs 0.24 crore in the corresponding quarter a year ago. Nitta Gelatin India is an India-based company engaged in the manufacture and sale of gelatin, ossein, dicalcium phosphate (DCP), chitosan, nutrigold, seedaid and collagen peptide. The company produces and supplies DCP to poultry farms and animal feed manufacturers in India.

9.15 am: Sensex opened 43.38 points, or 0.17 per cent, up at 24,868.21, while Nifty opened 10.70 points, or 0.14 per cent, up at 7,566.65. Stocks of Aban Offshore was down over 3 per cent after the company on Monday posted net loss of Rs 88.73 crore for the quarter ended December 2015 against net profit of Rs 129.99 crore in the corresponding quarter a year ago.

8.42 am: The BSE Sensex and NSE Nifty are likely to open on a flat to cautious note on Tuesday tracking Nifty futures on the Singapore Stock Exchange (SGX Nifty) and mixed global markets. The Reserve Bank of India is slated to announce its sixth bi-monthly monetary policy review on Tuesday.

At 8.24 am, SGX Nifty was up 0.14 per cent at 7,570.

Asian shares wobbled on Tuesday as crude oil prices slid on rekindled oversupply fears and after downbeat manufacturing data raised concerns about global momentum.

The Dow Jones industrial average fell 17.12 points, or 0.1 per cent, to 16,449.18. The Standard & Poor’s 500 index lost 0.86 of a point, or 0.04 per cent, to 1,939.38. The Nasdaq composite index rose 6.41 points, or 0.1 per cent, to 4,620.37.

On Monday, market benchmark Sensex edged lower on weakness in banking stocks as investors preferred to stay light on positions ahead of the Reserve Bank monetary policy meet on Tuesday. Amid rising inflationary pressures, RBI may maintain status quo in the monetary policy review and wait for cues from the Budget that would provide key macroeconomic direction. According to a Citi report, the central bank is likely to keep key policy rates unchanged until the budget and go for a 0.25 per cent easing in March or April this year.

Budget 2016-17 will be announced by Finance Minister Arun Jaitley on February 29.

The 30-share index dropped by 46 points to 24,824.83 as the Chinese manufacturing activity fell to its lowest level in three years.

The 50-share NSE Nifty moved down by 7.60 points or 0.10 per cent to 7,555.95.

Shares of Tech Mahindra will remain in focus on Tuesday. IT services firm Tech Mahindra reported 5.7 per cent decline in consolidated net profit at Rs 759.24 crore for the quarter ended December 31. The firm had registered a net profit of Rs 776.77 crore in the corresponding quarter of the last fiscal.

(With agency inputs)

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