Barometers turn volatile; Nifty holds 17,500 level

The benchmark indices traded sideways during mid-morning trade, dragged by pharma and IT stocks. The Nifty managed to hover above 17,500 mark. Trading turned volatile as a result of March 2022 F&O contracts are expiring today, 31 March 2022.

At 11:30 IST, the barometer index, S&P BSE Sensex fell 16.92 points or 0.03% at 58,667.07. The Nifty 50 index gained 5.55 points or 0.03% at 17,503.80.

The S&P BSE Mid-Cap index added 0.52%. The S&P BSE Small-Cap index rose 0.65%.

The market breadth, indicating the overall health of the market, was positive. On the BSE, shares 1,807 rose and 1,390 shares fell. A total of 133 shares were unchanged.

Foreign portfolio investors (FPIs) bought shares worth Rs 1,357.47 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 1,216 crore in the Indian equity market on 30 March 2022, provisional data showed.

Economy:

India Ratings and Research (Ind-Ra) stated that its FY23 Economic Outlook released in the month of January 2022, is unlikely to hold in view of the global geo-political situation arising out of the Russia-Ukraine conflict. Since the duration of Russia-Ukraine conflict continues to be uncertain, Ind-Ra has created two scenarios with respect to the FY23 economic outlook basis certain assumptions.

In Scenario 1, the crude oil price is assumed to be elevated for three months, and in Scenario 2, the assumption is for six months, both with a half cost pass-through into the domestic economy. Ind-Ra expects GDP to grow 7.2% Y-o-Y in Scenario 1 and 7% Y-o-Y in Scenario 2 in FY23, compared to its earlier forecast of 7.6%. However, the size of the Indian economy in FY23 will still be 10.6% and 10.8% lower than the FY23 GDP trend value in Scenario 1 and Scenario 2, respectively, the firm added.

Buzzing Index:

The Nifty Financial Services index rose 0.43% to 17,240.95. The index added 3.75% in four trading sessions.

Bajaj Finance (up 1.41%), Mahindra & Mahindra (M&M) Financial Services (up 1.23%), Axis Bank (up 1.12%), ICICI Lombard General Insurance Company (up 1.10%) and Shriram Transport Finance Corporation (up 1.10%) were the top gainers in the Financial Services segment.

Axis Bank gained 1.12%. The private bank will pay a consideration upto Rs 12,325 crore to Citibank for acquiring its consumer businesses in India. The transaction comprises the sale of the consumer businesses of Citibank India, which includes credit cards, retail banking, wealth management and consumer loans. The deal also includes the sale of the consumer business of Citi`s non-banking financial company, Citicorp Finance (India), comprising the asset-backed financing business, which includes commercial vehicle and construction equipment loans, as well as the personal loans portfolio. The deal offers strategic advantages to Axis Bank, such as premiumization of its overall customer portfolio, increased opportunities to cross-sell its products and accelerated digital transformation. Post the acquisition, Axis Bank will have about 28.5 million savings accounts, 2.3 lakh+ Burgundy customers and 10.6 million Cards.

IIFL Wealth Management advanced 2.47%. Bain Capital agreed to acquire 24.98% equity stake in the company. Bain Capital has agreed to acquire 24.98% equity stake in IIFL Wealth Management ("IIFLWAM") from General Atlantic Singapore Fund and FIH Mauritius Investments, a wholly owned subsidiary of Fairfax India Holdings Corporation. BC Asia Investments X will acquire 2,21,55,000 equity shares of IIFLWAM, constituting 24.98% stake, at Rs 1,661 per share, aggregating to Rs 3679.94 crore. The share purchase agreement was executed on 30 March 2022. The transaction is subject to regulatory and other customary approvals.

Stocks in Spotlight:

Cosmo Films jumped 3.40%. The company announced the setting up CPP film production line at Aurangabad with annual rated capacity of 25,000 MT. The CPP line will require an investment of about Rs 140 crore to be funded through internal accruals and debts and is expected to commence commercial production in 2 years.

Tata Steel gained 0.59%. The steel major said it will acquire ferro alloys producing assets of Odisha-based Stork Ferro and Mineral Industries for Rs 155 crore in an all-cash deal. An asset transfer agreement has been signed between the two companies on Wednesday. The asset acquisition will provide an inorganic growth opportunity for Tata Steel to augment its Ferro alloys processing capacities.

Global Markets:

Most Asian stocks declined on Thursday as oil prices fell sharply. China`s factory activity likely shrank in March, as the country imposed more mass testing and activity controls amid its worst resurgence of COVID-19 cases since early 2020. The country`s official manufacturing Purchasing Managers` Index for March came in at 49.5, lower than February`s reading of 50.2.

Oil futures dived more than $5 a barrel on Thursday after reports indicated that the Biden administration is weighing releasing some 1 million barrels of oil per day from strategic reserves for several months in a bid to calm soaring crude prices.

U.S. stocks fell on Wednesday on waning signs of progress for peace talks between Ukraine and Russia against a backdrop of a hawkish Federal Reserve curbing economic growth.

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