The domestic stock market was hammered on Thursday, after Russian forces invaded Ukraine. All the sectoral indices on the NSE crashed with banks, autos and realty shares crumbling. The Nifty settled below 16250 mark, its lowest level since August 2021. Trading was volatile due to monthly F&O expiry on the NSE.
The barometer index, the S&P BSE Sensex, tumbled 2,702.15 points or 4.72% at 54,529.91. The Nifty 50 index slumped 815.30 points or 4.78% at 16,247.95. Both the indices have fallen over 6.2% in seven consecutive sessions.
The NSE's India VIX, a gauge of market's expectation of volatility over the near term, surged 30.31% at 31.9825.
HDFC Bank (down 5.48%), ICICI Bank (down 5.03%), Reliance Industries (down 4.98%) and Infosys (down 3.78%) were major drags.
In the broader market, the S&P BSE Mid-Cap index cracked 5.53% while the S&P BSE Small-Cap index dropped 5.77%.
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Sellers outnumbered buyers. On the BSE, 231 shares rose while 3,161 shares fell. A total of 86 shares were unchanged.
Russian President Vladimir Putin launched a military operation in Ukraine on Thursday with explosions heard across the country and its foreign minister warning a "full-scale invasion" was underway. Putin appealed to Ukrainian soldiers to lay down their arms and go home. He said Russia doesn't plan to "occupy its southern neighbour, but that Russia must defend itself from those who took Ukraine hostage" -- the U.S. and its allies who had crossed Russia's red line with expansion of the NATO alliance.
India has called for an immediate de-escalation of tensions between Russia and Ukraine. India's Permanent Representative UN, TS Tirumurti cautioned that the situation is in danger of spiraling into a major crisis. He was addressing an emergency meeting of UN Security Council held on Ukraine this morning. This was the second meeting of UNSC this week and the fourth since January 31 as tensions escalated between Russia and Ukraine. Tirumurti emphasized sustained and focused diplomacy to address all issues concerning the situation.
Meanwhile, UN Secretary-General Antonio Guterres made a direct appeal to President Putin to stop Russian troops from attacking Ukraine.
Numbers to Track:
In the commodities market, Brent crude for April 2022 settlement jumped $7.68 or 8.17% to $101.73 a barrel. Higher crude oil prices could increase India's fiscal deficit, current account deficit and stoke fuel price inflation.
The yield on India's 10-year benchmark federal paper rose to 6.762% as compared with 6.739% 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 75.63, compared with its close of 74.6150 during the previous trading session.
MCX Gold futures for 5 April 2022 settlement surged 4.59% to Rs 52,690.
The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, was up 0.92% at 97.06.
Global Markets:
The Dow Jones index futures were down 721 points, indicating a weak opening in the US stocks today.
Shares in Europe and Asia tumbled on Thursday as investors continue to watch the escalating situation between Russia and Ukraine.
The Bank of Korea kept interest rates unchanged at 1.25% at its meeting on Thursday. However, it predicted that consumer price inflation will run "substantially above 3% for a considerable time."
Ukraine warned its citizens against traveling to Russia and to leave the neighboring country, if they are there. Meanwhile, the UK said that it was ready to impose more sanctions on Russia.
Meanwhile, the Biden administration announced it will allow sanctions to move forward on the company in charge of building Russia's Nord Stream 2 gas pipeline, following a first tranche of sanctions against Russia Tuesday that targets Russian banks, the country's sovereign debt and three individuals.
Stocks in Spotlight:
Saregama India slumped 4.90% to Rs 3869.50. The company's board proposed 10-for-1 stock split.
Hikal slumped 4.77%. The drug company said that the Bombay High Court has set aside the impugned order of closure issued by Maharashtra Pollution Control Board (MPCB). The writ petition filed by the company was also disposed by the Bombay High Court. The MPCB has been directed by the High Court to grant fresh personal hearing to the company in the matter, Hikal said. On 16 February 2022, Hikal had informed the exchanges about the receipt of a notice from MPCB for closure of the firm's manufacturing unit located at MIDC Taloja, Dist. Raigad. The closure notice was issued in view of certain alleged non-compliances of the conditional consent to operate and the recent Surat issue. The Taloja unit had contributed approx. Rs 260 crore amounting to around 15% of the turnover of the company for financial year 2020-21.
Bharat Forge slumped 5.15%. The forging product supplier announced that it has entered into a definitive agreement to acquire JS Autocast Foundry India. Established in 2004, JS Auto is a leading supplier of critical machined Ductile Iron castings for the wind, hydraulic, off-highway and automotive applications. Over the past 5 year, the sales of JS Auto has grown at a CAGR of 17.7%. JS Auto registered sale of Rs 259 crore in FY21. Bharat Forge will acquire JS Auto for an upfront consideration (based on enterprise valuation adjustments) plus fixed deferred payment at the end of 3rd year. The closing of the transaction is subject to customary closing conditions. The valuation is not disclosed herein due to reasons of confidentiality, the company said.
Ashoka Buildcon tumbled 11.13%. The EPC major said that it has received letter of acceptance (LoA) from Northeast Frontier Railway for a project involving electrification of railway lines in the State of Assam on EPC mode. The accepted offer of the project is Rs 692.50 crore. The contract period is 900 days.
L&T Finance Holdings tumbled 10.54% after CitiGroup Global Markets Mauritius and CBNA London sold 6.39 crore equity shares or 4.88% stake of the company on 21 February 2022. Post transaction, CitiGroup Global Markets Mauritius and CBNA London decreased its shareholding to 3.87% stake from 8.75% stake held in L&T Finance Holdings. The deal was executed as secondary market sale.
Piramal Enterprises tumbled 7.23%. The board will meet on 28 February 2022, to consider the issue of secured, rated, listed, redeemable NCDs up to Rs 100 crore along with an option to retain oversubscription up to Rs 400 crore. The total size will aggregate up to Rs 500 crore and the fund raising will be done on a private placement basis.
Sanofi India fell 1.29% after the company reported 23% fall in net profit to Rs 90.40 crore on a 4.5% fall in net sales to Rs 687.90 crore in Q4 December 2021 over Q4 December 2020. Total expenditure rose 1.3% YoY to Rs 56.70 crore in the fourth quarter, primarily due to higher raw material costs (up 85.3% YoY) and higher other expenses (up 10.8% YoY). Profit before tax in Q4 December 2021 stood at Rs 132.20 crore, down 22.3% YoY.
Federal-Mogul Goetze (India) jumped 5.47% to Rs 265 after Pegasus Holdings III, LLC, made an open offer to buy 25.02% of the fully diluted voting share capital of the company. Pegasus Holdings III, LLC will acquire up to 1,39,16,676 fully paid-up equity shares (25.02% equity) at Rs 275 per offer share aggregating to a total consideration of up to Rs 382.8 crore.
The open offer was triggered due to the merger between Pegasus Merger Co and Tenneco Inc, the ultimate holding company of Federal-Mogul Goetze (India). Tenneco Inc. on 23 February 2022, entered into an agreement to merge with Pegasus Merger Co., a corporation established under the laws of Delaware and a direct wholly owned subsidiary of Pegasus Holdings III, LLC. Effective upon the closing of the transactions, Merger Sub will merge with and into Tenneco Inc., with Tenneco Inc. continuing as the surviving corporation and a direct wholly owned subsidiary of the Parent. Tenneco holds a 100% stake in Federal-Mogul Mauritius and Federal-Mogul Germany under subsidiaries. Federal-Mogul Mauritius and Federal-Mogul Germany are the promoter companies of Federal-Mogul India. Meanwhile, promoter holds a 74.98% stake in Federal-Mogul India.
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