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Profit booking, negative global cues subdue equity markets

Sentinel Digital DeskBy : Sentinel Digital Desk

  |  2 April 2016 12:00 AM GMT

Mumbai, April 1: Profit booking, coupled with negative global cues and caution ahead of key macro-economic data, subdued the Indian equity markets on Friday.

Consequently, both the key indices of the Indian equity markets closed the day’s trade in the red.

The wider 50-scrip Nifty of the tiol Stock Exchange (NSE) ended in the negative territory. It dipped by 25.35 points or 0.33 percent, at 7,713.05 points.

The barometer 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE), which opened at 25,301.70 points, closed at 25,269.64 points — down 72.22 points or 0.28 percent from the previous day’s close at 25,341.86 points.

The Sensex touched a high of 25,354.94 points and a low of 25,119.35 points during the intra-day trade.

In contrast, the BSE market breadth favoured the bulls- with 1,729 advances and 811 declines.

The barometer index had closed flat on Thursday. It had inched up a mere 3.28 points or 0.01 percent.

Initially on Friday, both the key indices of the Indian equity markets opened on a negative note, in-sync with their Asian peers, especially the Chinese and Japanese exchanges.

Market observers cited that equity markets were dragged lower by profit booking and negative global indices.

Besides, upcoming US non-farm payrolls data and key domestic macro economic data deterred investors from chasing prices.

In addition, weak crude oil prices due to supply side issues dented sentiments.

However, key indices tried to pare their losses on the back of strong foreign funds inflow and hopes of a rate cut by the Reserve Bank of India (RBI).

“Profit booking and caution ahead of key global and domestic macro-economic data deterred investors from chasing prices,” And James, chief market strategist, Geojit BNP Paribas Fincial Services, told IANS.

“Negative global indices in Europe and Asia, too, dented sentiments.”

Nitasha Shankar, senior vice president for research with YES Securities said: “Broader markets bucked the trend to end in the green outperforming the headline indices. Midcap and smallcap indices ended with gains of 0.7 percent and 0.3 percent respectively.”

Shankar noted that reality, PSU (public sector undertaking) banks and FMCG (fast moving consumer goods) indices ended with handsome gains; while IT (information technology), auto, metal and pharma indices came under profit booking.

Vaibhav Agarwal, vice president and research head at Angel Broking, pointed out that expectations of a 25 basis points cut in the upcoming monetary policy could cheer the equity markets in the near term.

“Global markets would tend to react to US macro data for further cues on the rate hike ahead of the FOMC (federal open market committee) meet,” Agarwal told IANS.

“With the results season beginning next week, earnings growth would be a key trigger for the markets over the coming days.”

Furthermore, foreign institutiol investors (FIIs) were net buyers during the day’s trade, while the domestic institutiol investors (DIIs) sold stocks.

The data with stock exchanges showed that FIIs invested Rs.214.01 crore, while the DIIs sold stocks worth Rs.519.91 crore.

Sector-wise, healthy buying was witnessed in capital goods, consumer durables and FMCG stocks, while the scrips of automobiles, IT and oil and gas came under selling pressure.

The S&P BSE capital goods index increased by 159.47 points, followed by the consumer durables index, which gained by 80.09 points; and the FMCG index rose by 77.70 points.

Whereas, the S&P BSE automobile index plunged by 118.08 points, followed by the IT index, which receded by 115.01 points; and the oil and gas index dropped by 113.82 points.

Major Sensex gainers during Friday’s trade were BHEL, up 2.77 percent at Rs.116.90; ITC, up 2.42 percent at Rs.336; Larsen and Toubro (L&T), up 1.82 percent at Rs.1,238.30; Axis Bank, up 1.12 percent at Rs.449.55; and NTPC, up 0.89 percent at Rs.129.95.

Major Sensex losers during the day’s trade were Bharti Airtel, down 4.46 percent at Rs.335.25; ONGC, down 2.79 percent at Rs.208.75; Gail, down 2.44 percent at Rs.347.65; TCS (Tata Consultancy Services), down 2.41 percent at Rs.2,455.40; and Adani Ports, down 2 percent at Rs.242.75. (IANS)

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