We had mentioned in last week’s closing report that Nifty, Sensex were struggling to rally. The major indices of the Indian stock markets were moving sideways during the week and have closed on Friday with losses of 0.74%-1.41%. The weekly trends of the major indices of the Indian stock markets are given in the table below:
Disappointing macro-economic data subdued the Indian equity markets on Monday. Consequently, key indices traded flat -- marginally in the green during the mid-afternoon session, as heavy selling pressure was witnessed in banking, capital goods and oil and gas stocks. Initially, the key indices opened on a positive note on Monday, in sync with their Asian peers. However, investors were disappointed after a key macro-economic data showed a faster rise in annual wholesale inflation.
India's annual wholesale price index (WPI) moved up into the positive zone at 0.34% for April, from (-)0.85% in March and (-)2.43% during the corresponding month of the previous year. The WPI moved up after staying in negative zone for 17 straight months, mainly on the back of a rise in global commodity prices. The rise comes after the Consumer Price Index (CPI) for last month also showed an upward movement in annual retail inflation. The rise in both the inflation indices has reduced the chances of the Reserve Bank of India (RBI) to further ease its key lending rates during the monetary policy review scheduled in June.
Apart from the WPI, investors' sentiments were subdued after data released on May 13 showed that India's merchandise exports in April fell for the 17th straight month. Last month's exports were valued at $20.57 billion -- down 6.74% against $22.05 billion in the like month of last year.
Besides, selling pressure was witnessed in the banking sector after Bank of Baroda (BoB) reported its second consecutive quarter of losses. The BoB's quarterly results were released after the market hours last Friday.
On Tuesday, key indices made gains during the late-afternoon trading session, as healthy buying was witnessed in stocks of oil and gas, automobile, capital goods and banking sectors. However, investors were seen cautious, given the recent negative macro-economic data and poor quarterly results from state-owned banks. Key economic indicators show rising inflation trend that has reduced the chances of the Reserve Bank of India (RBI) further easing its key lending rates during the monetary policy review scheduled for June. In addition, the risk-taking appetite of investors was subdued a day ahead of the US Federal Open Market Committee (FOMC) releasing its minutes. The US FOMC minutes assume significance as they can give vital cues on the future course of US interest rates. On the BSE, there were 1,303 advances and 1,300 declines at the close of Tuesday’s trading.
State-run Indian Oil Corp (IOC) on Tuesday raised transport fuel prices, with petrol becoming costlier by 83 paise a litre and diesel by Rs.1.26, both at Delhi and inclusive of local levies, with corresponding increase in other states. Indian Oil Corporation share prices closed at Rs407.45, down 0.48% on the BSE. US stocks posted solid gains on Monday as investors cheered over a strong rebound in oil prices.
Negative Asian and US indices and disappointing quarterly results pushed the Indian equity markets down on Wednesday. This led the key indices to trade in the red during the mid-afternoon trade session, as selling pressure was witnessed in automobile, banking and information technology (IT) stocks. The Asian and domestic markets receded on the back of renewed fears of a US rate hike. In addition, reduced chances of the Reserve Bank of India (RBI) to further ease its key lending rates during the upcoming monetary policy review subdued investors' sentiments.
Public sector lender Punjab National Bank (PNB) on Wednesday posted a massive net loss of Rs.5,367.140 crore for the fourth quarter ended March 2016 caused by bad loans, as compared to net profit of Rs.306.56 crore in the corresponding period of last fiscal. For the entire fiscal 2015-16, the bank has posted a net loss of Rs.3,974.39 crore for the year ended March 31, 2016 as compared to net profit of Rs.3,061.58 crore for the year ended 31 March 2015, PNB said. PNB shares closed at Rs76.20, up 3.25% on the BSE.
Negative global cues, coupled with lower crude oil prices and a weak rupee, dragged the Indian equity markets lower on Thursday. This led the key indices to trade in the red during the mid-afternoon session, as heavy selling pressure was witnessed in the banking, capital goods and fast moving consumer goods (FMCG) stocks. Initially, the key indices opened on Thursday on a flat note, in sync with their Asian peers. The Asian and domestic markets receded on the back of hawkish comments from the US Federal Reserve, which increased the chances of a future rate hike. The US Federal Open Market Committee's (FOMC) April minutes disclosed that the US central bank might raise key lending rates in June. A hike is expected to lead FPIs (Foreign Portfolio Investors) away from emerging markets such as India. Besides, lower crude oil prices and a weak rupee eroded investors' confidence. However, investors' sentiments turned slightly positive after the electoral victory of the Bharatiya Janata Party (BJP) in Assam, which could potentially strengthen the central government's ability to push through economic reforms. On the BSE, there were 919 advances and 1,628 declines, while 165 were unchanged.
On Friday, positive global indices, along with higher crude oil prices and value buying, pushed the Indian equity markets higher. This led the key indices to trade marginally in the green, as healthy buying was witnessed in automobile, fast moving consumer goods (FMCG) and consumer durables stocks. However, the market turned bearish in late afternoon and fell by around 0.45%. There were 885 advances and 1,682 declines on the BSE.