Nifty may try to rally but it may not sustain beyond 5,920
The market settled over 1% lower as investors wait for the release of the headline inflation numbers for February tomorrow. Lacklustre global markets also weighed on the sentiments. The Nifty may try to rally but it may not sustain beyond 5,920. Around 55.67 crore shares were traded on the National Stock Exchange (NSE) while the advance-decline ratio was 408:1088.
The market opened in the negative tracking unsupportive global cues. The US markets closed flat with a mixed bias overnight in the absence of any fresh trigger. The Asian pack was lower in morning trade as authorities in Shenzhen, a city in southern China, banned developers from raising new home prices, giving rise to speculations that the tightening might increase further.
The Nifty opened 29 points lower at 5,885 and the Sensex started off at 19,512, down 53 points from its previous close. While the opening figure on the Sensex was its intraday high, the Nifty touched its high at around 11.20am with the index at 5,894. Selling pressure in IT, auto and banking stocks kept the benchmarks range-bound in the negative terrain.
Tata Motors global sales fell 22.36% in February to 98,837 units against 1,27,318 units sold in the same month last year. However, sales of luxury brands from Jaguar Land Rover were up at 35,485 units against 32,257 units. While sales of luxury sedans of Jaguar brand stood at 7,102 units, Land Rover sales were at 28,383 units, the company said in a statement.
A negative opening of the key European markets ahead of the release of the Eurozone industrial output data for January, weighed on domestic investors in post-noon trade.
The benchmarks touched their intraday lows in the last few minutes of trade on across-the-board selling, which saw all sectoral gauges, except the BSE Fast Moving Consumer Goods, staying in the negative. The Nifty touched 5,842 and the Sensex fell to 19,339 at their respective lows.
Settling in the negative for the third straight day, the Nifty fell 63 points (1.06%) to 5,821 and the Sensex dropped 202 points (1.03%) to close at 19,363.
Among the broader markets, the BSE Mid-cap index declined 1% and the BSE Small-cap index dropped 1.27%.
BSE Fast Moving Consumer Goods (up 0.50%) was the lone gainer in the sectoral space. The losers were led by BSE Bankex (down 2.18%); BSE Consumer Durables (down 1.57%); BSE Auto (down 1.53%); BSE PSU (down 1.41%) and BSE IT (down 1.18%).
Six of the 30 stocks on the Sensex closed in the positive. The main gainers were Sun Pharmaceutical Industries (up 1.25%); ITC (up 0.89%); Bharti Airtel (up 0.76%); Hindustan Unilever (up 0.59%) and Coal India (up 0.14%). The major losers were Hindalco Industries (down 3.67%); ICICI Bank (down 3.25%); Bajaj Auto (down 3.16%); Maruti Suzuki (down 3.07%) and Jindal Steel & Power (down 2.84%).
The top two A Group gainers on the BSE were—Lanco Infratech (up 6.26%) and IRB Infrastructure Developers (up 2.47%).
The top two A Group losers on the BSE were—Core Projects (down 5.70%) and Zee Entertainment Enterprises (down 5.61%).
The top two B Group gainers on the BSE were—Riba Textiles (up 18.93%) and Intense Technologies (up 18.08%).
The top two B Group losers on the BSE were—Polytex India (down 19.98%) and KGN Enterprises (down 19.98%).
Of the 50 stocks on the Nifty, 10 ended in the green. The key gainers were Sun Pharma (up 1.11%); Bharti Airtel (up 1.10%); Asian Paints (up 0.98%); ITC (up 0.97%) and HCL Technologies (up 0.72%). The top losers were Hindalco Ind (down 3.77%); ICICI Bank (down 3.48%); Bajaj Auto (down 3.45%); Kotak Mahindra Bank (down 3.43%) and JSPL (down 3.38%).
Markets across Asia settled lower as investors were worried that the Chinese curbs on property prices would dent economic growth. In another development, the head of the People’s Bank of China said his aim was to keep credit growth stable with a focus on GDP and retail inflation. Stocks in Japan settled lower as the yen strengthened against other world currencies.
The Shanghai Composite dropped 0.99%; the Hang Seng tanked 1.46%; the Jakarta Composite declined 0.70%; the KLSE Composite contracted 0.84%; the Nikkei 225 fell 0.61% and the Straits Times settled 0.68% lower. On the other hand, the Seoul Composite rose 0.32% and the Taiwan Weighted added 0.01%.
At the time of writing, the key European indices were down between 0.13% and 0.75% and the US stocks futures were trading with minor losses.
Back home, foreign institutional investors were net buyers of equities amounting to Rs733.25 crore on Tuesday whereas domestic institutional investors were net sellers of shares totalling Rs877.38 crore.
Bangalore-based Purvankara Projects today announced plans to raise around Rs450-Rs500 crore through the institutional placement programme or IPP. The funds raising will be done in the price range of Rs100-RS110 a share. The stock declined 4.16% to close at Rs91.05 on the NSE.
State-owned lender United Bank of India has received approval from its shareholders for preferential allotment of up to 1.37 crore equity shares to the Government of India at issue price of Rs72.95 a share. The stock fell 1.56% to close at Rs63 on the NSE.
The State Information Commissioner has issued a show-cause notice to the PIO of home ministry for not providing information under the RTI Act, within the stipulated time
Taking a strong objection on the Public Information Officer (PIO) of the home ministry for issuing orders instead of the First Appellate Authority (FAA), the Maharashtra State Information Commissioner (SIC) has issued a show-cause notice to the PIO.
Hearing an appeal filed by noted activist Samir Zaveri, SIC Ratnakar Gaikwad said both the FAA and the PIO are prima facie found neglecting the application filed under the Right to Information (RTI) Act.
During the hearing, Zaveri pointed out that the information sought by him in point A and C in his RTI application dated 13 July 2012, was still not provided by the PIO. To this, the PIO could not provide any explanation.
The SIC also noted that from the facts before the Commission it appears that the then PIO was guilty of not furnishing complete information within the time specified under sub-section (1) of Section 7 as per the requirement of the RTI Act. “It appears that the PIO’s actions attract the penal provisions of Section 20(1) and Section 19(8)(g). A show-cause notice is being issued to him, and he is directed give his reasons to the Commission to show cause why penalty should not be levied on him on 1 April 2013,” Mr Gaikwad said in his order.
Mr Gaikwad also directed the PIO to allow Zaveri to inspect the records related with the information he sought. The PIO can also take help from otter officers if needed under Section 5(4) of the Act for providing the information to Zaveri, the SIC said in its order on 11 March 2013.
RBI released its sector-wise monthly loan data for January 2013 which reveals that non-collateralized loans (credit cards and personal loans) and vehicle loans were the best-performing segments
Industry loans remained weak (year-on-year) y-o-y in January 2013 YTD (year-to-date). The key growth drivers within the industry segment have been power, iron & steel, chemicals and roads. Retail loans and agri loans are the strongest—retail loans grew at 13.5% y-o-y and agri loans grew at 19.8% y-o-y in January. Within retail, non-collateralized loans (credit cards and personal loans) and vehicle loans were the best-performing segments. This is according to an analysis of key trends by Nomura Equity Research in credit trends based on the RBI’s (Reserve Bank of India) sector-wise monthly loan data for January 2013.
As of January 2013, aggregate non-food credit growth was 14.6% y-o-y with primary contributions from industry (15.2% y-o-y), agri (19.8% y-o-y) and retail (13.5% y-o-y). As per the RBI's weekly statistical supplement, non-food credit as of 22 February 2013 was 16% y-o-y.
On an YTD basis (April 2012-January 2013), aggregate non-food credit growth was 7.9% over the base of March 2012 (compared with 10% in YTD FY12 and 14.6% in YTD FY11). The key contributions to YTD growth came from retail loans at 10.1% and industry at 8.3%. Agri loans grew at 6.8% while SME (small and medium enterprises) loans grew at 4.6%. Ex-infra industry growth was 4.9% during this period.
Within the industry sector, y-o-y growth for key sub-sectors was 28.4% for power, 18.7% for iron & steel, 19.2% for engineering, 18.7% for roads, and 22% for chemicals. Loans to the telecom sector were flat y-o-y.
One interesting observation to note is the declining loan share of medium & “small & micro” corporates within the industry segment. At their peak during April-August 2009, these corporates commanded a 12% and 17% loan share, respectively, within the industry segment, with large corporates having a 71% share. Comparatively, as of January 2013, the medium corporate share is now 9%; small & micro 13%; and large corporate share 78%. This share shift has been driven by the increasing loan share of the infrastructure segment which has increased from 24% in Jan 2009 to 34% in January 2013 (as a percentage of industry loans).
Over the last one year, medium corporates have lost the loan market share to the large corporates (11% share for medium corporates declining to 9%), while the small and micro corporates have held their ground. In Nomura’s view, this reflects the loan portfolio decisions of large banks like SBI which have been cutting back their medium corporate exposure over the last one year.
Within retail loans, credit card loans had the highest y-o-y growth at 24.3%, followed by vehicle loans at 21%, other personal loans at 16.3% and mortgages at 12.3% in January. Within mortgages, the bulk of the increase in January 2013 came from low-ticket mortgage loans which fulfil priority sector norms.
In the services segment, loans to the retail trade had the highest y-o-y growth at 27.8% followed by loans to NBFC at 21.6%.
Nomura predicts that if we assume that the same quantum of loan growth for February 2013 and March 2013 as was achieved during February 2012 and March 2012 then the industry can expect to see loan growth of 13.8% for FY13F.