Key benchmark indices extended losses and hit fresh intraday low in afternoon trade after European market opened lower. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit their lowest level in more than a week. The market breadth, indicating the overall health of the market was negative. The Sensex was down 139.63 points or 0.62%, off close to 262 points from the day's high and up about 22 points from the day's low. Weakness in Asian stocks also hurt sentiment on the domestic bourses adversely. Shares of most banks declined. Majority of the IT shares declined.
Key benchmark edged higher in early trade. Key benchmark indices trimmed gains after hitting fresh intraday high in morning trade. Key benchmark indices slipped into the red in mid-morning trade. The Sensex extended losses and hit fresh intraday low in early afternoon trade. The Sensex, and the 50-unit CNX Nifty, both, hit their lowest level in more than a week. Key benchmark indices extended losses in afternoon trade after European market opened lower.
Asian stocks dropped on Monday, 7 April 2014, in the aftermath of a mostly disappointing US jobs report.
At 13:15 IST, the S&P BSE Sensex was down 139.63 points or 0.62% to 22,219.87. The index declined 161.99 points at the day's low of 22,197.51 in afternoon trade, its lowest level since 28 March 2014. The index jumped 122.12 points at the day's high of 22,481.62 in morning trade.
The CNX Nifty was down 39.65 points or 0.59% to 6,654.70. The index hit a low of 6,650.40 in intraday trade, its lowest level since 28 March 2014. The index hit a high of 6,725.15 in intraday trade.
The BSE Mid-Cap index was down 56.33 points or 0.78% at 7,141.29, underperforming the Sensex. The BSE Small-Cap index was down 26.86 points or 0.37% at 7,238.19, outperforming the Sensex.
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The market breadth, indicating the overall health of the market, was negative. On BSE, 1,197 shares fell and 951 shares rose. A total of 113 shares were unchanged.
Among the 30 Sensex shares, 23 fell and the remaining shares rose. Bhel (down 3.45%), Maruti Suzuki India (down 2.78%), Cipla (down 2.25%), Hindalco Industries (down 2.18%), Dr Reddy's Laboratories (down 1.49%), Hero MotoCorp (down 1.41%), HDFC (down 1.39%), NTPC (down 1.12%), Hindustan Unilever (down 0.88%) and Tata Power (down 0.84%), edged lower from the Sensex pack.
Sun Pharmaceuticals Industries (up 1.19%), Sesa Sterlite (up 0.79%), M&M (up 0.59%), Wipro (up 0.52%) and Bajaj Auto (up 0.22%), edged higher from the Sensex pack.
Most IT shares declined. Hexaware Technologies (down 2.23%), Infosys (down 1.31%), Tech Mahindra (down 0.89%), CMC (down 0.70%), MphasiS (down 0.70%), Oracle Financial Services Software (down 0.43%) and TCS (down 0.31%), edged lower. Wipro (up 0.67%) and HCL Technologies (up 0.15%), edged higher.
Shares of most banks declined. Union Bank of India (down 2.5%), IDBI Bank (down 2.23%), ICICI Bank (down 2.06%), Bank of India (down 1.8%), Canara Bank (down 1.56%), Bank of Baroda (down 1.24%), Federal Bank (down 0.9%), Axis Bank (down 0.84%), IndusInd Bank (down 0.82%) and Punjab National Bank (down 0.07%), edged lower. Yes Bank (up 0.90%), Kotak Mahindra Bank (up 0.39%), HDFC Bank (up 0.30%) and State Bank of India (up 0.30%), edged higher.
In the foreign exchange market, the rupee edged higher against the dollar as speculation an increase in US borrowing costs may be pushed back boosted India's yield advantage over developed-nation debt. The partially convertible rupee was hovering at 60.08, compared with its close of 60.08/09 on Friday, 4 April 2014. US Treasury yields slumped on Friday, 4 April 2014, as an American jobs report that trailed estimates reduced bets the Federal Reserve will raise interest rates anytime soon. The yield on 10-year benchmark Indian government paper -- 8.83% GS 2023 -- surged 26 basis points last week to 9.07%.
The next major trigger for the stock market is Q4 March 2014 and year ended 31 March 2014 (FY 2014) corporate earnings. Investors and analysts will closely watch the management commentary that would accompany the results to see if there is any revision in their future earnings forecast of the company for the year ending 31 March 2015 (FY 2015) and/or for the year ending 31 March 2016 (FY 2016). Indian companies will start reporting their Q4 and full year results from mid-April 2014. The result season will conclude in end-May 2014.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014.
On the political front, the Bharatiya Janata Party (BJP) and Telugu Desam Party on Sunday, 6 April 2014, finalised their pre-poll alliance in Andhra Pradesh. The BJP will contest on eight seats in Telangana and five seats in Seemandhra region of Andhra Pradesh. Telangana has 17 Lok Sabha seats and Seemandhra has 25. The BJP will contest on 47 Assembly seats out of 119 in Telangana and 15 Assembly seats out of 125 in Seemandhra. Assembly polls in Andhra Pradesh and Telangana are to be held along with the ongoing Lok Sabha polls.
A major near term trigger for the stock market is the outcome of the upcoming Lok Sabha elections. The 36 days long voting process began today, 7 April 2015, in 6 Lok Sabha constituencies of Assam and Tripura and will finally conclude on 12 May 2014. The results will be declared on 16 May 2014 after which India will get a new government. The term of the current Lok Sabha expires on June 1 and the new House has to be constituted by May 31.
European market were trading lower in early trade, tracking weakness in the US market. Key benchmark indices in UK, France and Germany were down by 0.67% to 1.40%.
A monthly meeting of the Monetary Policy Committee of the Bank of England's (BoE) for monetary policy review is scheduled on Thursday, 10 April 2014.
Asian stocks edged lower on Monday, 7 April 2014, in the aftermath of a mostly disappointing US jobs report. Key benchmark indices in Hong Kong, Singapore and Japan were down 0.14% to 1.69%. Indonesia's Jakarta Composite rose 1.20%. South Korea's Kospi rose 0.08%. Markets in mainland China and Thailand are closed for a holiday.
The World Bank trimmed its 2014 growth forecast for developing East Asia but said the region's economies were likely to see steady growth in the next couple of years, helped by a pick-up in global growth and trade. The Washington-based development bank expects the developing East Asia and Pacific (EAP) region to grow 7.1% in 2014 and 2015, down from the 7.2% rate it had previously forecast for both years. Growth in 2016 is also seen at 7.1%, staying slightly below the 2013 growth rate of 7.2%.
Fitch Ratings has affirmed China's Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs) at 'A+'. The issue ratings on China's senior unsecured foreign and local currency bonds are also affirmed at 'A+'. The Outlooks on the Long-Term IDRs are Stable. The Country Ceiling is affirmed at 'A+' and the Short-Term Foreign Currency IDR at 'F1'.
Trading in US index futures indicated that the Dow could fall 56 points at the opening bell on Monday, 7 April 2014. US stocks fell on Friday, 4 April 2014, with the Nasdaq Composite Index sliding the most in two months, after large technology stocks from Google Inc. to Yahoo Inc. plunged as investors sold the bull market's biggest winners.
Companies led the US job market past a milestone in March as private employment exceeded its pre-recession peak for the first time, progress that will allow the Federal Reserve to stick to its policy course. Payrolls excluding government agencies rose 192,000 after a 188,000 gain in February that was larger than first estimated, the Labor Department reported in Washington. That brought the job count to 116.1 million, beating the January 2008 high of 116 million. The jobless rate held at 6.7% even as half a million Americans entered the workforce.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 29-30 April 2014. The Federal Reserve on 19 March 2014 said after the conclusion of a monetary policy review that it will trim its monthly bond purchases by $10 billion to $55 billion. The Federal Reserve will end its bond-buying program before the end of the year with an interest-rate increase likely to follow in "around six months," Chair Janet Yellen said on 19 March 2014. Quarterly Fed forecasts on 19 March 2014 showed more officials predicting that the benchmark interest rate, now close to zero, will rise to at least 1% by the end of 2015 and 2.25% a year later.
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