The domestic stock market recoiled after a robust start on Monday as two fresh coronavirus cases were reported in the country. The S&P BSE Sensex, slipped 153.27 points or 0.40% at 38,144.02, its lowest closing level since 11 October 2019. It had risen as much as 785.88 points to hit the day's high of 39,083.17 in afternoon trade.
The Nifty 50 index tumbled 69 points or 0.62% at 11,132.75, its lowest closing level since 7 October 2019. It jumped 231.25 points to hit the day's high of 11,433.
Domestic shares traded with sharp gains for most part of the session on hopes that major central banks would take steps to stabilise financial markets amid the coronavirus epidemic.
The rally fizzled in late trade after India's Health Ministry said one positive case of the novel coronavirus (COVID-19) has been detected in Delhi and Telangana each. According to the ministry statement, the person from Delhi travelled to Italy recently, while the one from Telangana has a travel history of Dubai. The ministry said that both the patients are stable and being closely monitored.
Following the statement, the Nifty corrected as much as 396.75 points, or 3.47% from the day's high to hit the day's low of 11,036.25 in late trade.
In the broader market, the BSE Mid-Cap index fell 0.65% and the BSE Small-Cap index fell 0.77%.
The market breadth was weak. On the BSE, 946 shares rose and 1508 shares fell. A total of 162 shares were unchanged.
With today's decline, the Nifty 50 index has fallen 8.19% in seven sessions. The index is down 10.44% from its record high of 12,430.50 hit on 20 January 2020.
Sharp foreign fund outflow in the past few sessions also spoiled sentiment. Foreign portfolio investors (FPIs) offloaded Indian shares worth Rs 3315.29 crore on Friday, taking their total sales to Rs 12213.23 crore in five days.
Economy:
The Indian economy grew at a slower pace of 4.7% during the third quarter of 2019-20, showed data released by the National Statistical Office (NSO) on Friday. This marks a slight growth from 4.5% reported in the previous quarter.
India's fiscal deficit in the first 10 months of the current fiscal year came in at Rs 9.85 lakh crore, or 128.5% of the revised budgeted target for FY20, government data showed on Friday. Net tax receipts in the April-January period were Rs 9.98 lakh crore, while total expenditure stood at Rs 22.68 lakh crore.
Meanwhile, the combined Index of Eight Core Industries stood at 137.5 in January, 2020, which increased by 2.2% as compared to the index of January 2019. Coal, Refinery Products, Cement, Electricity and Steel showed a rise in production. Natural Gas, Crude Oil and Fertilizers posted a decline in production.
The IHS Markit India Manufacturing Purchasing Managers' Index (PMI) declined to 54.5 in February 2020 from a near 8-year high of 55.3 in the previous month.
Numbers to Watch:
The yield on 10-year benchmark federal paper fell to 6.348% at 16:55 IST compared with 6.371% at close in the previous trading session.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 72.74, compared with its close of 72.24 during the previous trading session.
In the commodities market, Brent crude for May 2020 settlement rose 80 cents to $50.47 a barrel. The contract fell $2.06 or 3.98% to settle at $49.67 a barrel in the previous trading session.
Foreign Markets:
European shares were trading lower while most Asian markets ended higher on Monday. Investors were rattled by weekend data from China that showed its fastest ever contraction in factory activity, raising fears of a global recession from the coronavirus.
Chinese factory activity slumped to its sharpest contraction on record after the virus crippled manufacturing in February. The closely watched Caixin/Markit manufacturing purchasing managers' index (PMI) tumbled to 40.3 last month, the lowest level since the survey began in 2004, and down sharply from the 51.1 reading in January.
In US, stocks closed mostly lower on Friday, but off session lows, while recording their worst weekly slide since October 2008 amid intensifying fears over the potential degree of damage the spread of COVID-19 will inflict on the global economy and supply chains.
Buzzing Indian Index:
The Nifty PSU bank index fell 4.52% to 1,857.60, underperforming the other sectoral indices on the NSE. The index has slumped 11.95% in four straight sessions.
Bank of Baroda (down 6.99%), Punjab National Bank (down 5.22%), State Bank of India (down 5.1%), Canara Bank (down 4.13%), IDBI Bank (down 2.12%), Union Bank of India (down 1.75%) and Bank of India (down 1.57%) slumped.
Stocks in Spotlight:
Maruti Suzuki India rose 0.35%. The company reported a decline of 1.1% in overall sales, including domestic and exports. Maruti sold 147,110 units in February 2020 as compared to 1,48,682 units in February 2019.
Mahindra & Mahindra (M&M) added 0.50%. M&M reported a 42% fall in total automotive sales to 32,476 units in February 2020 from 56,005 units in February 2019.
Tata Motors shed 2.95%. The auto maker reported 32.4% decline in total sales (domestic & international) to 40,634 units in February 2020 from 60,151 units in February 2019.
Eicher Motors gained 2.38%. The company's unlisted subsidiary VE Commercial Vehicles (VECV) reported 28.7% decline in total sales to 4,586 units in February 2020 from 6,428 units in February 2019.
Eicher Motors said its total two-wheeler (Royal Enfield) sales rose 1% to 63,536 units in February 2020 as against 62,630 units in February 2019. Total two-wheeler exports fell 8% to 2,348 units in February 2020 compared with 2,564 units in February 2019. Eicher Motors stated that the coronavirus outbreak had minimal impact on the production of motorcycles during the month of February. Some of the company's supply partners have dependencies on the manufacturers in China for sourcing of certain specific components. The company is making all efforts for maintaining continued supplies of these components.
Bajaj Auto fell 3.21% after its total domestic auto sales fell 10% to 354,913 units in February 2020 as against 393,089 units sold in February 2019. Bajaj Auto's total 2-wheeler domestic sales fell by 21% to 146,876 units, total exports jumped 15% to 163,346 units in February 2020 over February 2019. Accordingly, total 2-wheeler sales in February 2020 stood at 310,222 units, down by 5% from 327,985 units in February 2019. Shares of Bajaj Auto were trading 0.4% lower at Rs 2878.75.
Reliance Industries slipped 1.04%. RIL said it has acquired 37.7% stake in textile manufacturer Alok Industries for Rs 250 crore. RIL and JM Financial Asset Reconstruction Co had jointly bid for acquiring Alok Industries that was auctioned under the insolvency and bankruptcy law by lenders to recover their unpaid loans.
Bharti Airtel declined 0.55%. The telecom major said it has paid an additional Rs 8,004 crore towards AGR dues. With the latest payment, the company has paid Rs 18,004 crore in all. The company has also deposited an additional amount of Rs 5,000 crore as an ad-hoc payment to cover differences, if any, arising from the reconciliation exercise with the Department of Telecommunication (DoT).
Indiabulls Housing Finance rose 1.66% after the Reserve Bank of India (RBI) in an affidavit to the court said that the company has not violated any law in its lending business. In a regulatory filing, the company said the RBI affidavit has highlighted the details of loans taken by the borrowers mentioned in PIL and the repayment dates of such loans, the RBI affidavit has mentioned no violations of any nature or kind regarding Indiabulls Housing Finance. The RBI affidavit stated The Writ Petition is not maintainable either on facts or law as against this Respondent, the Reserve Bank of India, and hence liable to be dismissed as such.
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