Rate cut fails to hold up markets; Sensex dips 1,310 pts from day's high

All that happened in the markets today

Equity market ended Friday's highly volatile session on a subdued note even as the Reserve Bank of India (RBI), in an emergency move, slashed the repo rate by a huge 75 basis points (bps) to arrest the potential downturn in the economy due to coronavirus (Covid-19) pandemic. In addition, the RBI imposed a moratorium on principal and interest payments for three months and told banks and non-banking finance companies that that non-payment won’t be considered as non-performing assets (NPA). READ MORE

The S&P BSE Sensex closed at 29,816, down 131 points or 0.44 per cent, with Axis Bank (up 5 per cent) being the top gainer and Bajaj Finance (down 9 per cent) the worst performer. Besides Bajaj Finance, stocks that contributed the most to the Sensex's fall were Bharti Airtel (down 6 per cent), HUL (down 3 per cent), and HDFC Bank (down 1 per cent). 

NSE's frontline index Nifty50 ended at 8,660, up 19 points or 0.22 per cent.  

On a weekly basis, Sensex slipped 0.33 per cent while Nifty fell 0.97 per cent. 

On the sectoral front, auto stocks slipped the most, thus snapping their three-day gaining streak. The Nifty Auto index ended around 2.5 per cent lower at  4,939 levels. On the other hand, private banks gained the most with the Nifty Private Bank index ending 1.72 per cent higher at 10,738 levels. 

Volatility index India VIX eased 0.77 per cent to 70.97 levels. 

In the  broader market, the S&P BSE MidCap index ended at 10,538, up 0.29 per cent while the S&P BSE SmallCap index ended 0.28 per cent higher at 9,497 levels. 

Global Markets

European shares tumbled in early trading on Friday after a stunning three-day rally sparked by hopes of more aggressive stimulus to shore up the global economy ravaged by the rapid spread of the coronavirus pandemic. Asian stocks, on the other hand, rose as investors wagered policymakers will roll out more stimulus measures to combat the coronavirus pandemic after US unemployment filings surged to a record.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.3 per cent, while Japan’s Nikkei rose 3.88 per cent, capping its biggest weekly gain on record. Australian shares gave up gains to fall 5.3 per cent after a strong week.

E-Mini futures for the S&P 500 reversed course and fell 0.88 per cent following three consecutive days of gains in the S&P 500 on Wall Street.

In commodities, oil prices were mixed as governments took unprecedented steps to limit the economic fallout from the coronavirus pandemic. Gold edged lower as investors booked profits, but was set for its best week since December 2008. 

(With inputs from Reuters)

4:17 PM

MARKET COMMENT | Vinod Nair, Head of Research at Geojit Financial Services

Indices ended almost flat following the RBI measures to lessen the burden on borrowers and to increase liquidity in the system. The markets were up in the last 2 sessions on the expectations of these announcements from the Government and RBI. Now, since the 2 expected events are out of the way, focus comes back on the spread of the virus and its damage on the already reeling economy.

4:04 PM

SECTOR WATCH | Sectoral gainers and losers on the NSE

4:03 PM

MARKET AT CLOSE | Top losers and gainers on the S&P BSE Sensex

3:42 PM

CLOSING BELL

The S&P BSE Sensex slipped 131 points or 0.44 per cent to end at 29,816 while NSE's Nifty50 ended at 8,660, up 19 points or 0.22 per cent

3:27 PM

EXPERT COMMENT | Naveen Kulkarni, Chief Investment Officer, Axis Securities

Expectations from RBI were riding very high on rate cut, moratorium and liquidity measures. RBI has delivered on every count. This will provide significant support to the market and economy. The small finance banks will see significant liquidity free, which is critical to tide through the current challenges. While the measures were much needed but the markets will move now on how the Covid curve behaves in India. Longer shut downs will be detrimental to economy and the markets. Earlier recovery from lock down will mean a V-shaped market recovery

3:22 PM

MARKET CHECK

3:13 PM

Gold eases on profit-taking, but set for best week since Dec 2008: Reuters

Gold fell on Friday as investors booked profits, but was set for its best week since December 2008 as record high U.S. jobless claims due to the coronavirus fuelled hopes for more stimulus to stem the economic damage caused by the pandemic.

3:01 PM

Dr Reddy's board approves borrowing of Rs 2,000 cr through multiple routes

For the purpose, the company is allowed to pursue any of the multiple modes available such as issuance of commercial paper, debentures, bonds and/ or through bank credit lines, term loans including external commercial borrowings that it may deem fit, according to a stock exchange filing. READ MORE  

2:57 PM

Top losers on BSE today

COMPANY	LATEST	PREV CLOSE	LOSS(%)
MAH. SEAMLESS	208.65	245.40	-14.98
CRISIL	1260.10	1401.65	-10.10
JSW ENERGY	41.70	46.00	-9.35
JAMNA AUTO INDS.	24.60	27.10	-9.23
ADANI POWER	27.50	30.10	-8.64

2:51 PM

Coronavirus: ITC's Sanjiv Puri lines up Rs 150 crore contingency fund

According to the company’s chairman and managing director, Sanjiv Puri, this fund will be utilised primarily to provide relief to the vulnerable and most needy sections of society who are impacted by the pandemic and are facing significant disruption in their livelihoods. READ MORE

2:43 PM

NEWS ALERT | Tata Motor's Board gives in-principle approval to subsidiarize it's PV business (including EV): BSE filing

2:41 PM

STOCK ALERT :: Aptech surges 20% in 2 days

2:38 PM

Nifty sectoral indices at this hour

2:32 PM

EXPERT COMMENT | Navneet Munot, ED & CIO, SBI Mutual Fund on RBI announcement

"Reserve Bank of India announced a big monetary bazooka including 75 bps repo rate cut along with massive liquidity injection (first CRR cut In 7 years!) and relaxation in various measures to address the existing and potential financial stress in the economy. Measures targeted at giving relief to almost all borrowers to tide over these difficult times, relaxation on asset quality classification, capital adequacy, marginal standing facility and infusing massive liquidity to de-freeze the corporate bond and CP market will go a long way in easing financial stress. With today's actions, total liquidity injection by RBI sums to 3.2% of GDP. While India has limited fiscal space, monetary policy continues to do the heavy lifting at a time when growth is at a severe risk in the near term.

We need to explore unconventional measures on fiscal, administrative and regulatory fronts on the lines of lead taken by RBI today. Lower crude oil prices will be one of the silver linings for India. We can also explore the idea of creating a crude oil strategic reserves by using Forex reserves. We have been running relatively higher duration in anticipation of strong monetary measures. We expect yields to remain soft in the near term. These announcement will be taken positively by the equity market, however, its movements will continue to be dictated by the evolving situation on COVID-19 crisis and its implications on the economy and corporate profitability. As a house, our focus continues to remain on the bottom up stock picking

2:24 PM

EXPERT COMMENT | Umesh Revankar, MD and CEO, Shriram Transport Finance on RBI rate cut move

The rate cut of 75bps is in line with our expectations and will aid to bring down the cost of borrowing. The CRR cut of 100bps will help in infusing the desired liquidity requirement in the system. The three months moratorium announcement will reduce the repayment pressure on the borrower and give him buffer time to understand his income status and react to his repayment of the loan accordingly.”

 

Adding, “All in all, it is a very welcoming policy. The government have announced corrective measures to combat with current pandemic situation which would thereby help in bringing financial stability into the system"