)
Benchmark indices ended at their lowest closing levels since January 14, 2015 and also registered the highest percentage drop since January 6, 2015 as risk-aversion prevailed following March F&O expiry and concerns over foreign capital outflows amid geo-political tensions after Saudi Arabia led coalition of Arab nations launched air strikes on Yemen to neutralise Houthi Rebels.
The 30-share Sensex ended down 654 points at 27,458 and the 50-share Nifty closed down 189 points at 8,342.
The seventh straight session of losses came on the back of sharp sell-off in financials and information technology shares along with losses in metal and pharmaceutical stocks.
Commenting on today's session, Dipen Shah, Head of Private Client Group Research, Kotak Securities, said, "The F&O expiry and potential geo-political issues in the Middle East, likely to have impacted markets today. Going ahead, there are no immediate triggers for the markets on the domestic front and hence, markets may continue to be dictated by global factors. Quarterly results are also expected to be subdued. Further action on the fiscal or monetary front, if any, can give some upside to the market. However, we remain positive on the medium – to – long term prospects of the markets based on our expectations of further fiscal reforms and a pick-up in the economic growth over the period."
Sharp sell-off in Indian markets was in-line with the weakness observed in global equity markets following weak economic data from US that led to nearly 2% decline in the US markets overnight. Sell-off in technology shares led to Nasdaq Composite index falling most steeply in nearly a year.
Emerging geo-political concerns in the Middle East following the air strikes by Saudia Arabia led coalition of Arab nations on Yemen against Houthis rebels have also kept risk-appetite suppressed.
On the political front, the NDA government may have to let the Land ordinance lapse and wait for the second half of parliament's budget session that starts from April 20 to introduce the Land Acquisition and GST Bill.
The Cabinet Committee of Economic Affairs (CCEA) led by the Prime Minister Narendra Modi approval of the plan to use regassified LNG to restart stalled gas-based power projects in India is likely to add to the profits of gas and power companies such as GAIL, Reliance Power among others.
In the broader market, both the BSE Midcap index, down 0.8% and Smallcap index, down 1% performed better than the front-liners. Market breadth in BSE ended negative with 1,821 declines against 952 advances.
Meanwhile, foreign portfolio investors (FPIs) bought shares worth a net Rs 813.19 crore yesterday, as per provisional data.
F & O CORNER
"As per the provisional data, Nifty futures has seen a roll-over of just over 72% which is in line to the last 6 month average but lower than the previous series at 80.54%," said Chandan Taparia, derivative analyst at Anand Rathi Securities addding that in the Nifty 50 highest roll-overs were seen in HDFC Bank, Sun Pharma, BHEL, Grasim and Wipro. Overall in the F&O segment IB Real Estate, JSW Steel, M&M Financial, IOC and HPCL also witnessed huge roll-overs, he said.
On the outlook for the April series he said that the Nifty has broken the important support zone of 8,450-8,500. Till it does not cross the same, weakness may continue till 8,250 levels.
BUZZING STOCKS
11 out of the 12 sectoral indices of BSE ended in red. BSE IT and Metal indices down 2.6% and 2.2% each were the top losers followed by BSE Bankex down 2.5%.
Housing finance major, HDFC declined around 5%. The company has fixed March 26, 2015 as the record date for the purpose of payment of interim dividend, if approved by the board.
ICICI Bank slipped over 2%. The Ministry of Defence announced the signing of a Memorandum of Understanding (MoU) between the Indian Army and ICICI Bank on the Defence Salary Package. HDFC Bank and Axis Bank too have declined around 2%.
SBI ended down close to 4%. SBI will reduce its stake in the general insurance Joint Venture Company with IAG (Insurance Australia Group) from 76% to 51%.
IT stocks were under pressure after the tech-led sharp sell-off in US markets. Infosys declined over 3%, Wipro shed more than 4% and TCS was down 2.3%. According to media reports, Wipro is setting up 'commando force' by next month to target clients and drive up business.
NTPC slipped 2%. The Ministry of Coal has announced re-allotment of five coal mines namely, Chatti-Bariatu, Chatti-Bariatu(South), Kerandari, Dulanga and Talaipalli to the company.
Among pharma stocks, Sun Pharma and Dr Reddys Lab declined around 3% each while Cipla ended down nearly 2%. Cipla has announced the launch of generic drug Sofosbuvir, used in hepatitis C treatment, under the brand name of 'Hepcvir.
The air strikes by Saudia Arabia led coalition of Arab nations on Yemen against Houthis rebels has pushed up crude oil prices around 4% higher on concerns over geo-political crisis in Middle East that may lead to higher crude oil prices in future. ONGC dropped around 2% and RIL was down around 2%. Following government's decision on regassified LNG, RIL may lose potential customers as it fails to generate gas from its KG basin.
GAIL stands to benefit from government approval to allow regassified LNG to restart stalled gas-based power projects in India across the entire gas value chain (long-term LNG contracts, stake in re-gasification terminals and ownership of pipelines). The stock ended higher by 0.5%.
Hero Motocorp's joint venture with Magneti Marelli today inaugurated its first autonomous "Production and Development Centre" at Manesar, Harayana. The new centre will serve as a production facility and innovation hub for new generation fuelling engines for Hero Motocorp two-wheelers. The stock was up 0.45%.
Bharti Airtel gained around 1% on expectations of winning a large pie in the 900 Mhz spectrum auction.
