Indian share markets finished the trading session in red for a second consecutive day. The sentiments remained negative following losses in global equity markets after hawkish comments from US Federal Reserve chair Jerome Powell, raising prospects of more rate hikes. Market watchers were also cautious ahead of GDP data due to be released after 5.30pm.
At the closing bell, the BSE Sensex closed lower by 162 points and the NSE Nifty finished lower by 61 points. The S&P BSE Mid Cap finished down by 0.2% while S&P BSE Small Cap finished up by 0.2%.
Losses were largely seen in FMCG stocks, bank stocks and metal stocks.
Among the most active stocks in the BSE Sensex today are Hindustan Unilever (down 2%), ICICI bank (down 1.9%) and Sun Pharma (down 1.7%). Among the BSE 500 stocks, the most active stocks include Venky's (up 14%), Lakshmi Vilas Bank (down 6.1%) and Vakrangee (down 5%).
While this should do for the wrap on active stocks, we notice that many of you are tracking low priced shares as well. Low priced shares are not necessarily cheap or attractive. But then, there's a lot of interest in them.
Go ahead, check out the most actives here:
NSE Rs 10 to 20 most active stocks
BSE Rs 10 to 20 most active stocks
NSE above Rs 20 most active stocks
BSE above Rs 20 most active stocks
Asian stock markets finished broadly lower today with shares in Japan leading the region. The Nikkei 225 is down 1.44% while Hong Kong's Hang Seng is off 1.36% and China's Shanghai Composite is lower by 0.99%. European markets are lower today with shares in France off the most. The CAC 40 is down 0.24% while London's FTSE 100 is off 0.23% and Germany's DAX is lower by 0.16%.
Rupee was trading at Rs 65.10 against the US$ in the afternoon session. Oil prices were trading at US$ 63.01 at the time of writing.
The Market cap to GDP ratio for Indian companies too is close to dangerously high levels. While this is still some way off the peak of FY-08, when it had once reached close to 150, it's relatively high.
FY17 saw this ratio reach close to 80. It is also expected to increase further given the moderate growth expectations in India's GDP for FY18. Warren Buffett once considered this as one of the best valuation metrics to gauge the markets.
Past history shows some correlation between the ratio and the share market. 2008 saw Sensex decline by 38% when this ratio crossed the 100 mark. Also, the market has bounced back sharply when this ratio was low.
The Warren Buffett Indicator Suggests Indian Equity Market Is Overvalued
The basic assumption in this ratio is that whenever the GDP of the country grows, the market performance will reflect it. Also, when stocks do well, it can be extrapolated to assume the Indian economy is doing well.
Moving on to news from pharma sector. Cipla share price finished the day up by 1% on the BSE after the company entered into a distribution agreement with Roche Pharma India under which Cipla will promote and distribute tocilizumab (Actemra) and Syndyma, the 2nd brand of Roche's cancer therapy, bevacizumab (Avastin) in India.
This partnership is in line with Cipla and Roche's efforts to improve healthcare and increase access to innovative, life-changing medicines in India, particularly to patients who currently do not have access to them.
The two companies have, in the past, locked horns legally. But the latest distribution agreement is aimed at increasing access to innovative medicines in India.
In news from real estate sector, DLF share price finished up by 1.8% after the company's subsidiary DLF Home Developers Ltd placed a winning bid of Rs 14.96 billion for an 11.76-acre land parcel in Udyog Vihar, Gurugram, in an auction conducted by Haryana State Industrial and Infrastructure Development Corp.
Market watchers believe the success of the auction assumes significance in light of the general perception of a sluggish real estate market and vindicated the tag of Gurugram being the most preferred investment destination in India.
The land is strategically located next to the operational buildings of CyberCity and the under-construction Cyber Park. The land acquisition effectively further strengthens and expands their current commercial office asset portfolio.
In news from the economy, growth in factory activity slowed to a four-month low in February as new orders eased and weighed on output after manufacturers raised prices at the fastest pace in a year, a business survey showed.
The Nikkei Manufacturing Purchasing Managers' Index (PMI), compiled by IHS Markit, fell to 52.1 in February from January's 52.4 and was below the 52.8 expected in a Reuters poll. But it held above the 50 mark that separates growth from contraction for the seventh consecutive month.
In another development, Moody's Investors Service today said the Indian economy is starting to recover from the negative impact of demonetization and disruption caused by the GST roll-out, but kept GDP growth estimates unchanged at 7.6% for 2018.
In its global growth forecasts for 2018 and 2019, Moody's said the Budget for fiscal year beginning April 1 (2018-19) includes some measures to stabilize the rural economy that was disproportionately hit by scrapping of high denomination Rs 500 and Rs 1,000 notes.
In November last year, Moody's had raised India's sovereign rating for the first time in 13 years, saying growth prospects have improved with continued progress on economic and institutional reforms. The US-based agency had upped India's rating to Baa2 from Baa3 and changed its rating outlook to 'stable' from 'positive', saying the reforms would help stabilize rising levels of debt.
Moody's Investors Service revised its global growth forecasts for 2018 and 2019, incorporating stronger than expected economic data and reflecting the likely pick-up tied to additional US fiscal stimulus.
And here's a note from Profit Hunter:
Despite the broader market indices witnessing selling pressure, Ashok Leyland is up 2.5% and is trading at its lifetime high.
The last time we reviewed the stock, it had broken above its important resistance level of 97 with strong volumes. This indicated strength in the counter. As a result, the stock surged nearly 38% to hit a high of 134 in October 2017.
It then consolidated for a while and found resistance from 130 level. It broke above this resistance level earlier this month to hit a fresh life-time high of 139. It made a pullback to 130 level but found support there. Previous resistance usually act as a support on subsequent declines.
The stock rebounded from this support level and rallied strongly to hit a new life-time high of 142 in today's session.
So it will be interesting to see if the stock can rally as it did after previous resistance break-out or will the weakness in the broader market indices drag the stock down.
Ashok Leyland Hits a Fresh Life-time High
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