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Markets witness over a percent fall on Monday
Apr-22-2019

Indian equity benchmarks witnessed over a percent fall on Monday, with Sensex and Nifty breaching their psychological levels of 38,700 and 11,600, respectively. The start of the day was negative, amid a private report stating that business sentiments continue to decline for the country's financial and macro-economic conditions in the second quarter of the year compared to the same period a year before. As per the report, Composite Business Optimism Index stands at 78.4 during Q2 2019 as against 85.0 during Q2 2018 marking a 7.7% decline. The street also got cautious, with reports that National transporter Indian Railways account for nearly three-fifths of 344 central sector projects that are facing huge cost overrun due to delay in implementation for various reasons. The latest flash report of the Statistics and Programme Implementation Ministry (MOSPI) for December 2018 showed that total cost overrun of 205 delayed railway projects is whopping Rs 2.21 trillion.

Key indices remained under the grip of bears throughout the day and ended the trading session in red terrain. Domestic sentiments also got hit, after India has again missed the target of becoming an electricity-surplus nation by a whisker as its peak power deficit stood at 0.8 percent and the overall energy deficit remained 0.6 percent in the financial year 2019. Adding anxiety on the street, the Central Board of Direct Taxes (CBDT) directed the Income-Tax Department to initiate penalty proceedings by June 30 against non-filers and ‘drop filers’ of tax returns. According to the non-filer monitoring system (NMS) of the I-T department, data for 20.4 million non-filers has been obtained between 2013 and 2017, of which 2.5 million are those who are inconsistent- popularly known as ‘dropped filers’. Traders paid no heed towards Prime Minister Narendra Modi’s statement that the number of registered traders under the Goods and Services Tax (GST) has almost doubled, and brought transparency to the system.

On the global front, European markets remained closed on Monday for Easter holiday. Asian markets ended mixed, as producer prices in South Korea were up 0.3 percent on month in March. The Bank of Korea said that this follows the 0.1 percent increase in February. Individually, agricultural, forestry and marine products climbed 1.0 percent on month, while manufacturing products added 0.4 percent, services rose 0.2 percent and utilities were flat. On a yearly basis, producer prices added 0.1 percent after sliding 0.2 percent in the previous month. Separately, overall nationwide consumer prices in Japan were up 0.5 percent on year in March. The ministry of Internal Affairs and Communications said that this was in line with expectations and up from 0.2 percent in February. Core consumer prices were up 0.8 percent on year - exceeding expectations for 0.7 percent, which would have been unchanged from the previous month.

Back home, stocks related to the gems & jewellery industry remained in focus, as the Gems and Jewellery Export Promotion Council’s (GJEPC) data report showed that India’s gems & jewellery exports fell 3.12% during 2018-19 (FY19), owing to the factors like credit crunch, delays in goods and services tax (GST) refunds, and high import duties on polished diamond. Gross gems and jewellery exports from India decreased to $39.68 billion in 2018-19 as compared to $40.96 billion in the previous year. However, the report further noted that gross cut and polished diamond exports from India remained stable at $23.82 billion during 2018-19 as against $23.72 billion in the previous year.

Finally, the BSE Sensex slipped 495.10 points or 1.26% to 38,645.18, while the CNX Nifty was down by 158.35 points or 1.35% to 11,594.45.

The BSE Sensex touched a high and a low of 39,158.22 and 38,585.65, respectively and there were 5 stocks advancing against 26 stocks declining on the index.

The broader indices ended in red; the BSE Mid cap index fell 1.53%, while Small cap index was down by 1.44%.

The only gaining sectoral indices on the BSE were IT up by 0.58% and TECK up by 0.46%, while Oil & Gas down by 3.20%, Energy down by 2.73%, Realty down by 2.54%, Bankex down by 1.94% and Metal down by 1.84% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 0.89%, TCS up by 0.88%, Infosys up by 0.59%, NTPC up by 0.26% and Power Grid up by 0.08%. On the flip side, Yes Bank down by 6.62%, Indusind Bank down by 4.11%, Reliance Industries down by 2.76%, ICICI Bank down by 2.54% and HDFC down by 2.44% were the top losers.

Meanwhile, the Retirement fund body, Employment Provident Fund Organisation (EPFO) in its latest ‘Net Payroll Data’ report has showed that job creation in India’s formal sector almost trebled to 8.61 lakh in February 2019 in comparison to 2.87 lakh reported during the corresponding month last year. It noted that the highest ever job creation figures were reported in January 2019 at 8.94 lakh against the provisional estimate of 8.96 lakh released last month.

According to data, during February 2019, the highest number of 2.36 lakh jobs were created in the 22-25 years age group. This was followed by 2.09 lakh jobs in the 18-21 years age bracket. It also showed that 80.86 lakh new jobs were created in the 18 months period from September 2017 to February 2019. However, the payroll data has revised downward the number of net subscribers added or new jobs created from September 2017 to January 2019 to 72.24 lakh from 76.48 lakh released last month.

The EPFO stated that the sharpest revision was for March 2018 in the latest report which showed contraction or exit of 55,934 members from the EPFO subscriptions. Last month, the EPFO payroll data had showed that as many as 29,023 members exited from its schemes in March 2018. In February 2019, the EPFO data had showed that as many as 5,498 members joined EPFO schemes in March 2018. On contraction in March 2018 numbers, it said, the figure is negative due to large number of exits reported in the month of March, in view of it being the closing month of the financial year.

The CNX Nifty traded in a range of 11,727.05 and 11,583.95. There were 10 stocks advancing against 40 stocks declining on the index.

The top gainers on Nifty were Bharti Airtel up by 1.46%, Wipro up by 1.21%, Tech Mahindra up by 0.71%, Infosys up by 0.59% and TCS up by 0.48%. On the flip side, Indiabulls Housing Finance down by 9.07%, Yes Bank down by 6.92%, BPCL down by 6.32%, Indusind Bank down by 4.28% and Indian Oil Corporation down by 3.97% were the top losers.

Asian markets ended mixed on Monday in the absence of fresh cues from Wall Street and European markets, which were closed for the Good Friday holiday. Chinese shares ended lower amid speculation the government may slow down monetary easing. Meanwhile, Japanese market ended up, supported by gains in financial, automobile and chemical sections. Hong Kong’s market remained closed for the Easter Monday holiday.

Asian Indices

Last Trade           

Change in Points

Change in %

Shanghai Composite

3,215.04
-55.76
-1.70

Hang Seng

-

-

-

Jakarta Composite

6,414.74
-92.48
-1.42

KLSE Composite

1,622.06

-0.01

--

Nikkei 225

22,217.90
17.34
0.08

Straits Times

3,357.70
10.12
0.30

KOSPI Composite

2,216.65
0.50
0.02

Taiwan Weighted

10,987.71
19.21
0.18
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