NEW DELHI: The domestic equity market tanked on Tuesday, as the bears took charge on Dalal Street after crude oil prices slumped below the $31 a barrel mark for the first time in 12 years.
Bank stocks led the slump, after December quarter numbers of two lenders showed a spike in bad loans, raising fresh asset quality concerns.
The S&P BSE Sensex slumped to its fresh 52-week low in intraday trade before closing 54 points, or 0.7 per cent, lower at 7510.30. The 50-share Nifty50 made its fresh 52-week low, ending the day at 24,682.03, down 143 points, or 0.58 per cent. Federal Bank and Gruh Finance were the top losers on the BSE benchmark.
Selling pressure from foreign investors pulled the domestic benchmark indices lower, continuing their recent weak trend. The counters of Axis Bank, HDFC, TCS, HDFC Bank saw maximum selling.
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“On the index, there is an oversold reading, but otherwise, the trend is on the downside. What might happen is that we might get a pullback one of these sessions, which can take us back to 7,610 or 7,630 on the upside but immediately it would be difficult to see any upside beyond the current level. I would still maintain a negative bias. But after having seen the market drop by about 450-plus points in the last seven sessions, there is always a chance of a pullback,” said Mitesh Thacker of miteshthacker.com.
The broader market indices underperformed the benchmark indices with the BSE midcap and smallcap indices ending the day lower by 0.94 and 1.03 per cent, respectively. Among the sectoral indices, the BSE telecom was the top loser followed by BSE bankex and BSE Finance.
Market experts said the selling pressure seen in the market is limited only to the largecaps and that the midcap end of the market will be able to cope up with it. They believe sooner or later DIIs and HNIs will enter the market to lap up the stocks that are available at cheaper valuations.
“I think the midcap end of the market is holding up pretty well. It has been consistently outperforming the largecaps, and wherever there is growth, those stock valuations would be still rich. That trend we have been observing for past two-three years and this is definitely going to continue going into 2016. But we are in the uncharted territory when it comes to China and global growth and with the US increasing interest rates, the international scene is a very hotchpotch and complicated,” said Dipan Mehta, member, BSE & NSE.
Shares of IndusInd Bank slipped 3.31 per cent over asset quality concerns after the company announced its December quarter earnings during the session. Federal Bank, too, slumped 7.46 per cent after reporting a 39 per cent decline in Q3 net profit. Scrips of Tata Consultancy Services ended 1.65 per cent lower ahead of its Q3 earnings announcement, scheduled for release after market hours.
European markets traded with smart gains bucking the selling pressure seen in some of the Asian markets. The German DAX rose 1.45 per cent while the French CAC40 was up by a per cent. The pan-European Euro Stoxx 50 traded 0.65 per cent higher. Britain’s FTSE100 index was also up by 0.52 per cent.
Earlier in the day, other Asian markets ended on a mixed note. Japan’s Nikkei fell to its three-month low, closing 2.71 per cent lower. The South Korean Kospi was down 0.21 per cent at close. Hong Kong’s Hang Seng index ended the day 1 per cent lower while mainland China’s Shanghai Composite rose 0.35 per cent.
WHAT TOP EXPERTS ARE SAYING:
Hero Moto’s 68% of volumes to see rising competition in FY17: CLSA
Merger of Advanta to be value accretive in long term for UPL: BofA ML
NTPC stock looks cheap in our view, trading at FY17 P/BV; dividend yield of 3%: Citi
Here is a list of top ten stocks that are likely to be in focus today:
TCS Ltd: TCS is likely to report marginal fall in net profit of 0.56 per cent for the quarter ended December 31 on Tuesday to Rs 6021.30 crore, compared to Rs 6055 crore reported in the year-ago period, said an ET Now Poll.
IT companies: India’s export-driven IT outsourcing firms are likely to raise client fees and process more work from their centres in India to cushion the impact of an increase in fees for work visas in the United States, their top market, investors said.
HDFC Ltd: HDFC Life has set up a a wholly-owned subsidiary in the Dubai International Financial Centre (DIFC) called the ‘HDFC International Life and Re Company Limited’ (HILRCL) with an initial capital outlay of $12.33 million., said a media report.
Tata Motors Ltd: Tata Motors, part of conglomerate Tata Group, declared its sales volumes for the month of December 2015. The Group, which owns brands like Jaguar and Land Rover, witnessed Global sales at 91,762 units, a growth of 7% YoY.
Road infrastructure stocks in focus: In a bid to reduce accidents by 50 per cent, the government will spend Rs 11,000 crore in the next five years to fix black spots across the country. It will also set up the Road Safety Authority to reduce the number of accidents on Indian roads, said a media report.
Unitech Ltd: Delhi court on Monday granted three days’ interim bail to top Unitech officials in alleged cheating case. Earlier in the day, Unitech Ltd Chairman and its two managing directors were sent to 14-day judicial custody. The case was filed by two investors.
Vivimed Labs Ltd: Vivimed Labs has informed that the Board of Directors of the Company has approved, resolved, and taken note of the sub division proposal of Company’s Equity Shares from the existing face value of Rs 10 per Equity Share to Rs 2 per Equity Share subject to the approval of Company’s shareholders.
Omax Autos Ltd: Auto component maker Omax Autos said it has sold the remaining 51 per cent stake in its subsidiary Gmax Auto.
IOB: Indian Overseas Bank (IOB) said it will rationalise the number of its regional offices by closing 10 such offices to improve efficiency.
PI Industries Ltd: PI Industries Limited has commenced the Commercial Production at its 3rd Unit located at Sterling SEZ facility, Jambusar in State of Gujarat w.e.f. January 11, 2016.
MARKETS THROUGH THE DAY:
Markets @ 3
Sensex 24,676, down 149 points, Nifty 7,511, down 53 points
NTPC (2.47%), WIPRO (2.34%), M&M (1.20%), ADANI PORTS & SEZ (1.11%), BHEL (0.87%)
AXIS BANK (2.66%), TATA STEEL (2.46%), ONGC (2.34%), SBI (2.03%), BHARTI AIRTEL (1.84%)
Markets @ 2
Sensex 24,695, down 130 points, Nifty 7,515, down 48 points
NTPC (2.22%), M&M (1.75%), SUN PHARMA (1.05%), BHEL (0.90%), ADANI PORTS & SEZ (0.88%)
AXIS BANK (2.97%), ONGC (2.65%), TCS (2.08%), BHARTI AIRTEL (1.96%), TATA STEEL (1.87%)
Markets @ 1
Sensex 24,638, down 187 points, Nifty 7,504, down 61 points
NTPC (2.08%), SUN PHARMA (0.71%), ADANI PORTS & SEZ (0.53%), L&T (0.52%), BHEL (0.47%)
AXIS BANK (3.16%), ONGC (2.50%), TATA STEEL (2.16%), TATA MOTORS (2.08%), TCS (2.03%)
Markets @ 12
Sensex 24,679, down 146 points, Nifty 7,517, down 47 points
NTPC (1.87%), L&T (1.53%), BHEL (1.10%), ADANI PORTS & SEZ (0.81%), GAIL (0.72%)
AXIS BANK (2.79%), ONGC (2.58%), TATA MOTORS (1.91%), BHARTI AIRTEL (1.67%), TCS (1.57%)
Markets @ 11
Sensex 24,691, down 134 points, Nifty 7,519, down 45 points
ADANI PORTS & SEZ (2.18%), NTPC(1.59%), L&T (1.55%), BHEL (1.07%), GAIL (1.03%)
ONGC (2.50%), AXIS BANK (2.05%), INFOSYS LTD (1.88%), TCS (1.39%), SBI (1.32%)
Markets @ 10
Sensex 24,798, down 28 points, Nifty 7,557, down 7 points
NTPC (2.29%), L&T (1.80%), BHEL(1.70%), ADANI PORTS & SEZ (1.24%), GAIL (0.92%)
ONGC (1.92%), AXIS BANK (1.73%), TCS (1.06%), DR. REDDYS LAB (1.04%), WIPRO (0.81%)
At 09:20 AM:
The 30-share index was trading at 24,861, up 37 points or 0.15 per cent. It touched a high of 24,825.04 and a low of 24,819.30 in morning trade.
The Nifty50 was at 7,574 up 11 points or 0.14 per cent. It touched a high of 7,588.30 and a low of 7,565.30 in the first 30 minutes of trade.
The S&P BSE Midcap Index was up 0.44 per cent and BSE S&P Smallcap Index was trading 0.48 per cent higher.
NTPC (up 1.8 per cent), L&T (up 1.6 per cent), BHEL (up 1.5 per cent), Tata Steel (up 1 per cent), and Asian Paints (up 0.88 per cent), were the major Sensex gainers.
ONGC (down 1.7 per cent), Axis Bank (down 1.1 per cent), Dr Reddy’s Laboratories (1.08 per cent), and Hero MotoCorp (down 0.61 per cent) were among the major Sensex losers.