Market ends with small losses; Nifty settles below 17,500

The benchmark indices ended with modest cuts on Thursday. Trading was volatile as March 2022 F&O contracts expired today, 31 March 2022. The Nifty settled below 17,500 mark, reversing from the day`s high of 17,559.80 hit in early trade. FMCG shares were in demand while pharma and healthcare stocks were under pressure.

The S&P BSE Sensex fell 115.48 points or 0.20% at 58,568.51. The Nifty 50 index lost 33.50 points or 0.19% at 17,464.75.

Shares opened higher taking cues from FIIs buying. FIIs were net buyers of Indian shares in the past two consecutive days. However, the sentiment turned negative in line with global peers following inconclusive Russia-Ukraine talks.

The broader market ended higher. The S&P BSE Mid-Cap index rose 0.29%. The S&P BSE Small-Cap index gained 0.31%.

The market breadth was negative. On the BSE, shares 1,451 rose and 1,951 shares fell. A total of 105 shares were unchanged.

India`s April-Feb Fiscal Deficit:

India`s fiscal deficit at February-end at 82.7% of revised estimates in Budget, according to official data released by the government on Thursday. The fiscal gap stood at Rs 13.17 lakh crore.

In April-February, net tax receipts were Rs 14.81 lakh crore while total expenditure was Rs 31.44 lakh crore, the data showed. The revenue gap came in at Rs 8.7 lakh crore, while spending was at Rs 31.4 lakh crore.

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.

Numbers to Watch:

The yield on 10-year benchmark federal paper rose to 6.843% as compared with 6.784% at close in the previous trading session.

In the foreign exchange market, the rupee was higher against the dollar. The partially convertible rupee was hovering at 75.76, compared with its close of 75.90 during the previous trading session.

MCX Gold futures for 5 April 2022 settlement rose 0.37% to Rs 51,141.

The US Dollar index (DXY), which tracks the greenback`s value against a basket of currencies, rose 0.41% to 98.19.

In the commodities market, Brent crude for May 2022 settlement fell $6.06 or 5.44% at $105.38 a barrel 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.

Global Markets:

European shares declined while Asian stock ended on a mixed note on Thursday after Chinese manufacturing weakened and Russian shelling around Ukraine`s capital shook hopes for progress in peace talks.

Russia has been accused of intensifying its bombardment of the besieged Ukrainian city of Chernihiv and continuing to attack Kyiv despite claims the Kremlin would drawback out of respect for ongoing peace talks.

Meanwhile, 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.

In Europe, the UK economy expanded more than initially estimated in the fourth quarter, reflecting the revisions across the service sector, data from the Office for National Statistics showed on Thursday. Gross domestic product grew 1.3% sequentially in the fourth quarter, instead of the initial estimate of 1%. This was also faster than the 0.9% rise in the third quarter.

Stocks in Spotlight:

Axis Bank rose 1.39%. The private bank announced acquisition of Citibank`s consumer businesses in India. The bank will pay a consideration upto Rs 12,325 crore to Citibank for the acquisition.

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.

GAIL (India) rose 1.50% after the company`s board approved share buyback worth Rs 1,082.72 crore at Rs 190 per share. The company proposes to buy back up to 5,69,85,463 equity shares, comprising 1.28% of the total paid-up equity capital of the company, at a price of Rs 190 per share, for an aggregate amount not exceeding Rs 1082,72,37,970.

Max Healthcare tumbled 4.03% to Rs 346.90. The media reported that private equity fund KKR will sell stake in Max Healthcare via block deal on 31 March 2022. The stake would be offloaded by Kayak Investment, which is the KKR-affiliated entity that has invested in the healthcare company. Kayak Investment will sell $500 million worth of shares, with base size of $375 million or Rs 2,800 crore, reports suggested.

Hindalco Industries slumped 5.04%. Hindalco has unveiled an $8-billion capex plan over the next five years. A foreign brokerage downgraded the stock to "outperform" and cut its target price to Rs 695 from Rs 710 per share.

Jaiprakash Associates tumbled 5.67%. The construction firm has defaulted on payments to lenders to the tune of Rs 2,897 crore on 28 February 2022.

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