Indian equity benchmarks traded on a weak note throughout the day and ended with cut of around four tenth of a percent. The equity benchmarks made a disappointing start in early deals on account of selling in frontline blue chip counters followed by weak global cues. The sentiments were also under pressure with the street raising concerns over the Centre’s future reform policies in view of anointment of hardliner Yogi Adityanath as the Chief Minister of the country’s most populous state. Market men are particularly concerned about any large-scale selling by the foreign investors who tend to react promptly to any such development. Traders reacted negatively to a report that G20 failed to agree on free trade amid rising protectionism, even though they reiterated their resolve to avoid competitive currency devaluation. Some pressure also crept in with the report that expansion or modernization projects that have been undertaken without obtaining prior environment clearance (EC) will be treated as violation and strict action will be taken by the government. Also, the All India Consumer Sentiments Index, measured by the BSE and CMIE, has hit a one-year low at 92.25 compared to 99.65 a year ago. This comes even as the wholesale price index based inflation jumped up to a 39-month high of 6.55 per cent. The daily index measures consumer sentiment, expectations and the perceived economic scenario. The index for all three parameters is at its lowest since it was launched last year. Investors shrugged off the report that cabinet has approved four bills to implement a planned Goods and Services Tax (GST) bills, paving the way for Prime Minister Narendra Modi to implement the landmark tax reform from July. The four bills are likely to be taken up by Parliament this week and a separate state GST bill in state assemblies later.
On the global front, Asian markets closed on a mixed note, following Wall Street’s declines and the G20’s decision to drop a pledge to avoid trade protectionism, while the Federal Reserve’s less hawkish-than-expected comments continued to drag the dollar lower. Hong Kong stocks powered to 19-month closing highs as surge in energy and tech shares helped sustain optimism. European shares pulled back from 15-month highs with lower crude prices weighing on oil stocks and banks falling after Deutsche Bank set terms of its 8 billion euro cash call.
Back home, select Information Technology (IT) stocks closed in red after reports emerged that Cognizant may cut at least 6,000 jobs, which represents 2.3% of its total workforce, as it struggles with growth in an IT environment that is fast shifting towards new digital services. The layoffs are likely to be more this year than the routine annual exercise.
The BSE Sensex ended at 29525.39, down by 123.60 points or 0.42% after trading in a range of 29482.40 and 29699.48. There were 14 stocks advancing against 16 stocks declining on the index. (Provisional)
The broader indices ended in green; the BSE Mid cap index was up by 0.23%, while Small cap index was up by 0.31%. (Provisional)
The top gaining sectoral indices on the BSE were Consumer Durables up by 1.17%, FMCG up by 0.48%, Healthcare up by 0.45%, Utilities up by 0.30% and Realty up by 0.30%, while IT down by 1.58%, TECK down by 1.40%, Telecom down by 1.18%, Energy down by 0.71% and Oil & Gas down by 0.51% were the losing indices on BSE. (Provisional)
The top gainers on the Sensex were NTPC up by 1.00%, Lupin up by 1.00%, ITC up by 0.92%, Coal India up by 0.90% and Bharti Airtel up by 0.66%. (Provisional)
On the flip side, Axis Bank down by 2.51%, Infosys down by 2.21%, ICICI Bank down by 1.94%, TCS down by 1.91% and Wipro down by 1.59% were the top losers. (Provisional)
Meanwhile, pointing that the current price indices fails to capture the ground reality, a Parliamentary panel has asked the government to come up with a separate price index for the services sector, which could accurately factor in and reflect the rising costs of different services in the economy, enabling the government to tailor their policy responses accordingly. Further, the panel added that sectoral regulators need better data on prices, production and quality of services to act in the consumer interest.
The Parliamentary panel said that although services account for around 60 per cent of the country's economy, they are neither captured fully by the Wholesale Price Index (WPI) based inflation nor the Consumer Price Index (CPI), which reflects the rate of price rise at retail level and noted that in view of service sector contribution to the Indian economy, there is need of accurate data on services inflation to understand relative price movements.
The panel further noted that entertainment, transportation and the like are mostly privatised, and costs may be rising 'disproportionately higher' than what is being captured in the CPI or retail inflation. The panel said that sectoral regulators need better data on prices, production and quality of services to act in the consumer interest. It pointed that the Reserve Bank of India has shifted its focus from wholesale prices to retail inflation while determining its monetary policy because WPI did not include services in its basket. However, the rising cost of education, healthcare, entertainment and transportation do not get fully reflected even in CPI.
The CNX Nifty ended at 9130.25, down by 29.80 points or 0.33% after trading in a range of 9116.30 and 9167.60. There were 23 stocks advancing against 28 stocks declining on the index. (Provisional)
The top gainers on Nifty were Aurobindo Pharma up by 2.54%, Grasim Industries up by 2.16%, BHEL up by 1.63%, Eicher Motors up by 1.46% and Coal India up by 1.04%. (Provisional)
On the flip side, Idea Cellular down by 10.08%, Axis Bank down by 2.83%, TCS down by 1.97%, Infosys down by 1.92% and ICICI Bank down by 1.85% were the top losers. (Provisional)
The European markets were trading in red; UK’s FTSE 100 decreased 17 points or 0.23% to 7,407.96, Germany’s DAX decreased 34.72 points or 0.29% to 12,060.52 and France’s CAC decreased 19.52 points or 0.39% to 5,009.72.
Asian equity markets ended mixed on Monday following Wall Street's decline and the G20's decision to drop a pledge to avoid trade protectionism, while the Federal Reserve's less hawkish-than-expected comments continued to weigh on the dollar. Chinese stocks bucked the weak trend to close higher, as gains among energy stocks offset declines in the realty sector. China's property market picked pace in February despite the government announcing a raft of measures to temper speculative demand, data showed on Saturday. Japanese markets were closed for the Vernal Equinox holiday.
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