Market strain continues, Sensex drops 739 points for the week

Mumbai, March 10: Equities continued to choke under selling pressure for the week, with benchmark Sensex sliding 739.80 points to close 33,307.14 points, and the broader Nifty tumbling 231.50 points to conclude below the key 10,300-level at 10,226.85.

The market battled potential global trade-war as US government levied import tariffs on metals upsetting domestic sentiment, as a result the market strength deteriorated and correcting over two per cent for the week.

The trading sessions of the week also strained by country’s weak services sector figures which fell to six months low, while banking struggles related to NPA issues amid PNB fraud loomed investors sentiment.

The Nikkei India Services PMI data was released during the week with index falling 51.7 in January to 47.8 in February, the lowest level since August 2017.

The market made a rally attempt amid value buying and shortcovering in hammered stocks during fourth session of the week, it was shortlived with global trade tussle continued to gain upper-hand.

The Sensex started the week down at 34,034.28 and hovered between 34,060.13 and 32,991.14, it closed the week at 33,307.14, showing a slide of 739.80 or 2.17 per cent. (The Sensex lost 95.21 points last week).

The Nifty also resumed the week lower at 10,428.30 and traded between 10,441.35 and 10,141.55 before ending the week at 10,226.85, showing a loss of 231.50 points, or 2.21 per cent.

Barring consumer durables, the market witnessed across the sector selling pressure intense in broader market with Midcap and Smallcap plunging 2.88 per cent and 4.31 per cent respectively.

Metal, HealthCare, PSU Bank were worst hit followed by Power, Oil&Gas, Capital Goods, IPOs, Realty, Banks, Auto, FMCG, Teck and IT segments. Meanwhile, foreign portfolio investors (FPIs) and foreign institutional investors (FIIs) bought shares worth Rs 774.24 crore during the week, as per Sebi’s record including the provisional figure of March 09, 2018.

The S&P BSE Mid-Cap index fell 474 points or 2.88 per cent to settle at 15,987.27. The S&P BSE Small-Cap index fell 779.02 points or 4.31 per cent to settle at 17,305.92. Both these indices underperformed the Sensex.

Among sectoral and industry indices, metal dipped by 6.87 percent followed by healthcare 4.15 per cent, power 3.42 per cent, oil&gas 3.02 per cent, capital goods 2.95 per cent, IPO 2.92 per cent, realty 2.61 per cent, bankex 2.58 per cent, auto 2.28 per cent, FMCG 2.25 per cent, teck 0.74 per cent and

IT 0.30 per cent, while consumer durables rose by 1.47 per cent.

Among the 31-share Sensex pack, 26 stocks fell and remaining 5 stocks rose during the week.

Among stocks, Tata Steel was the biggest loser in the Sensex pack last week. The stock slumped 10.32 per cent to Rs 605.60. Tata Steel emerged as the highest bidder to buy a controlling stake in Bhushan Steel.

Auto major Tata Motors fell 7.86 per cent to Rs

341.70. The company reported robust sales performance for the month of February 2018. It registered a growth of 38 per cent year-on-year at 58,993 units in February 2018 due to continued strong sales performance of its commercial and passenger vehicles business in the domestic market. Exports declined 3 per cent at 4,768 units.

It was followed by Tata Motors DVR 7.34 per cent,

Adani Ports 6.68 per cent, Bharti Artl 5.81 per cent, Yes Bank 5.39 per cent, ONGC 5.22 per cent, Sun Pharma 5.18 per cent, Dr Reddy 4.38 per cent and ICICI Bank 4.11 per cent.

However, Asian Paints rose by 0.88 per cent, NTPC 0.55 per cent, Infosys 0.27 per cent and Indus Ind Bank 0.22 per cent.

The total turnover during the week on BSE rose to Rs 18,015.55 crore as against last weekend’s level of Rs 13,895.41 crore and NSE moved up to 1,45,645.93 crore compared to Rs 1,21,278.51 crore previously.


Gold shines again

Bullion: Riding high on positive global cues and increased buying by local jewellers, gold prices regained its sheen at the bullion market during the week.

Silver also surged by Rs 300 per kg on increased offtake by industrial units.

Bullion traders attributed the rally in gold to a firm trend overseas as the dollar weakened after the US

President Donald Trump said he would push ahead with punitive tariffs on steel and aluminium imports, rekindling fears of a potential trade war.

Besides, pick-up in buying by local jewellers at the domestic market, fuelled the uptrend, they added.

In worldwide trade, gold prices ended higher, erasing their loss for the week, as monthly data revealed a strong rise in US jobs, but disappointing growth in wages.

The US dollar weakened in the wake of the employment data. Gold and the greenback often move inversely as a weaker dollar can raise the appeal for investors using other currencies to buy the precious metal.

April gold rose USD 2.30, or 0.2 per cent, to settle at USD 1,324 an ounce—up roughly 60 cents, or 0.05 per cent, for the week, leaving its year-to-date gain at roughly 0.8 per cent.

Among other metals, May silver tacked on 0.7 per cent to USD 16.608 an ounce, clinging to a 0.9 per cent weekly gain.

In the New York Comex trade, gold for April delivery climbed to USD 1,324.00 an ounce compared to last Friday’s close of USD 1,323.40 and silver for May contract rose to end at USD 16.608 an ounce from USD 16.40.

On the domestic front, standard gold (99.5 purity) resumed higher at Rs 30,510 per 10 grams from last Friday’s closing level of Rs 30,230, it rose to Rs 30,610 before settling at Rs 30,395, revealing a rise of Rs 165, or 0.55 per cent.

Pure gold (99.9 purity) also commenced higher at Rs

30,660 per 10 grams compared to preceding weekend level of Rs 30,380, and surged to Rs 30,760 before closing at Rs 30,545, showing a rise of Rs 165, or 0.54 per cent.

Silver ready (.999 fineness) opened positive at Rs

38,575 per kilo gram from last Friday’s closing level of Rs 38,085, and rose further to Rs 38,805 before finishing at Rs 38,385, registering a rise of Rs 300 per kilo, or 0.79 per cent.


Resilient rupee ends steady

Reversing its two-straight weeks of downtrend, the rupee ended virtually stable at 65.17 against the US dollar in a highly volatile trade even as uncertainty over US President Donald Trump’s proposed tariffs dominated the headlines.

The Indian rupee had a turbulent week and witnessed a roller coaster ride, reaching fresh one-week highs only to tumble down.

It showed much resilience and managed to stand on a strong foot against the dollar despite a massive sell-off in local bourses.

Highly bullish economic data releases were largely overshadowed by the much anticipated aggressive tightening policy by the Federal Reserve.

Consistent capital outflows from foreign funds against the backdrop of highly volatile domestic stock markets largely weighed on the rupee front.

Overall, forex sentiment has been negative in the wake of rising protectionism and developments in foreign exchange and other financial markets.

Meanwhile, global mood improved gradually on fading trade war fears in the midst of optimism for a potential easing of tension spurred by a possible meeting between US President Donald Trump and North Korea’s Kim Jong Un.

At the Interbank Foreign Exchange (forex) market, the rupee resumed higher at 65.10 from last Thursday’s close of 65.17 on the back of good dollar supply.

It later touched a fresh one-week high of 64.86.

Expectations of robust capital inflows into the country due to political stability, especially in the wake of BJP’s strong showing in the country’s North East region ahead of the national election in 2019, predominantly supported the Indian unit initially.

But, the local unit succumbed to intense selling pressure towards the tail-end trade and touched a low of 65.19, relinquishing all early strong gains.

The rupee finally settled unchanged at 65.17 against the US dollar. It depreciated by a staggering 96 paise in last two-week fall.

In the meantime, country’s foreign exchange reserves rose by USD 167.8 million to USD 420.758 billion in the week to March 2 on an increase in core currency assets, the Reserve Bank of India said.

On the other hand, foreign investors pulled out over Rs 11,000 crore from Indian stocks in February, making it the largest outflow in five months, primarily due to better opportunities in other emerging markets.

In the international energy front, global crude prices rebounded from two days of declines on falling US oil rig count, while investors also grew hopeful that a planned meeting between US President Donald Trump and North Korea’s Kim Jong Un could ease geopolitical tensions.

Brent crude futures settled at USD 65.59 a barrel.

On the global front, the greenback showed little reaction despite the US economy having added the largest number of jobs in more than 1-1/2 years in February, as slowing wage gains indicated only a gradual increase in inflation this year.

Elsewhere, BoJ and the European Central Bank both left monetary policy unchanged as widely expected.

The dollar index, which measures the greenback’s value against a basket of six major currencies, was up at 90.11 as compared to 89.95 previously.

However, in cross-currency trade, the rupee fell back against the British pound to end at 90.06 per pound from 89.54 and also retreated against the euro to finish at 80.16 as compared to 79.41.

The home currency, however staged a mild recovery against the Japanese Yen to settle at 61.04 per 100 yens from 61.05 last Thursday.

In the forward market, premium for dollar edged higher due to mild paying pressure from corporates.

The benchmark six-month forward dollar premium payable for July inched up to 125.50-127.50 paise from 125-127 paise and the far-forward contract maturing in February 2019 also moved up to 246-248 paise from 242-244 paise. (PTI)

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