Sensex drifts lower…Nifty holds 5200

The Indian markets ended marginally lower with the key stock indices receding in late afternoon trade on news of a powerful earthquake off the Indonesian coast. The opening was negative for the Indian market due to weak global cues. The main indices remained in the negative zone before climbing into the positive terrain in mid afternoon.

However, the indices witnessed fresh selling after a major quake struck Indonesia's Aceh province, causing several nations in the region to issue tsunami warnings. The US Geological Survey put the intensity of the Aceh earthquake at 8.7 as against initial estimate of 8.9.

The BSE Sensex ended at 17,199, down 44 points or ~0.3% over the previous close. It had earlier touched a day’s low of 17,319 and a day’s high of 17,075. It opened at 17,125.

The NSE Nifty settled at 5,227, down 17 points or 0.3% over the previous close. It touched a day’s low of 5,190 and day’s high of 5,263.



The INDIA VIX on the NSE ended higher by 1.7% to close at 22.29. It hit days high of 22.75. It hit a low of 21.65.

The BSE Mid-Cap index fell 0.6% while the BSE Small-Cap index dropped 0.3%.

Out of the 50 stocks in the Sensex, the notable losers were Jindal Steel, Bharti Airtel, Sterlite, BHEL, Tata Power, RIL and TCS.

Among the major gainers included Sun Pharma, NTPC, Infosys, SBI, HDFC Bank, HDFC and HUL.

The market breadth was negative, with 1539 stocks declining and 1232 stocks advancing.

Selling pressure was seen in Metals, Consumer Durables, Oil & Gas and Capital Good stocks. Realty, Power and Auto indices also closed lower. Pharma was the top winner today followed by select buying in Banking, IT and FMCG space.

Cement stocks fell sharply amid reports that the Competition Commission of India was soon likely to announce ruling on alleged price cartelisation in the sector. A negative ruling was expected to hurt profits and pricing power of cement manufacturers, reports said quoting dealers.

India Cements fell ~8% to end at 96.5. It touched a day’s high of Rs. 103 and a day’s low of Rs. 95.5. The total traded quantity stood at 45 lakh shares on the NSE.

ACC ended lower by 5%. It touched a day’s high of Rs. 1287 and a day’s low of Rs. 1,221. The total traded quantity was 6.9 Lakh shares on the NSE.

Ambuja Cements slipped 4.3% to close at Rs. 159. It touched a day’s high of Rs165.40 and a day’s low of Rs158. The total traded quantity was 31 lakh shares on the NSE.

“The Indian market witnessed a steep fall in the opening trade, as investors continued to shun risky bets on growing concerns about domestic economic fundamentals and deteriorating external backdrop. Stocks across Europe and US sank on Tuesday after bond yields in Spain and Italy jumped sharply. Global investors have also turned wary of a sharper slowdown in China even as doubts increase on the sustainability of the US economic recovery.

The undercurrent is nervous before the important events like IIP, Inflation, Infosys results and RBI policy meeting in the next four sessions. FII inflows have turned negative this month owing to the uncertainty over GAAR provisions. Traded volumes have also tapered off and the INDIA VIX has steadily climbed,” says Amar Ambani, Head of Research, IIFL.

The RBI on Tuesday reiterated its concerns on inflation and a widening current account deficit in a meeting with economists a week before its annual monetary policy review, according to media reports.

Majority of the economists and market experts expect the RBI to cut its repo rate (used to lend money to banks) by at least 25 bps on April 17.

The CRR will be left unchanged at 4.75%. The RBI has slashed the CRR by 125 bps this year. The RBI, which boosted the repo rate 13 times since the beginning of 2010, has kept the repo rate at 8.5% since October 2011.

Many economists have scaled down their expectations of rate cuts given the mounting worries about sticky inflation, high global oil prices, and swelling government deficits.

India's balance of payments slipped into negative territory for the first time in three years and the current account deficit widened to $19.6bn in the October-December quarter as exports slumped and imports rose.

The rupee fell to a three-month low today, as domestic stocks extended recent fall amid growing risk aversion among the global investors even as concerns resurfaced over the eurozone debt crisis.

The partially-convertible Indian currency has been declining steadily of late, as the Government's proposed new tax rules have prompted FIIs to gradually pare their holdings of local assets. The rupee fell to an intraday low of 51.6450 today, its lowest level since January 16.

Asian stocks closed mostly lower on Wednesday, with stock indices in Japan, Hong Kong and Australia pacing the losses on the back of a steep fall in the US and European markets. However, markets in China managed to recover smartly.

Japanese stocks ended lower for a seventh straight trading day. The Nikkei, which ranked among the world’s best performing stock indices in the first quarter with a gain of more than 19%, is down 6.2% so far this month.

European stock markets recovered from the previous session's losses. European banks rallied after a sector upgrade and bond yields in Italy and Spain eased. Upbeat earnings news from Alcoa also lifted sentiment.

The Stoxx Europe 600 index was up 0.8% after plunging 2.5% on Tuesday.

HSBC lifted the European banking sector to 'overweight' from 'neutral' for the first time in four years.

US stock futures advanced after aluminum producer Alcoa kicked off the earnings season with a surprise profit for the first quarter.