Sensex drops 388 pts, Nifty holds 17,500 mark; broader mkt tumbles

The domestic equity barometers ended with steep losses on Tuesday amid mixed global cues. Traders were also cautious as the Q4 result season kicked off in India. The Nifty settled above the 17,500 mark after hitting the day`s low of 17,442.35 in afternoon trade. Metals, IT and energy stocks tumbled. Select private banks and financial stocks bucked the broader selling pressure.

The S&P BSE Sensex shed 388.20 points or 0.66% to 58,576.37. The Nifty 50 index dropped 144.65 points or 0.82% to 17,530.30.

Axis Bank (up 1.67%), Kotak Mahindra Bank (up 1.05%), Power Grid Corporation of India (up 0.95%), Maruti Suzuki India (up 0.65%) and ICICI Bank (up 0.59%) bucked the weak market trend.

The broader market declined sharply. The BSE Mid-Cap index slipped 1.45% and the BSE Small-Cap index lost 1.47%.

The market breadth was weak. On the BSE, 1,110 shares rose and 2,316 shares fell. A total of 90 shares were unchanged.

The NSE`s India VIX, a gauge of market`s expectation of volatility over the near term, fell 0.61% to 18.16.

Numbers to Watch:

The yield on 10-year benchmark federal paper rose to 7.189% as compared with 7.149% at close in the previous trading session.

In the foreign exchange market, the rupee was lower against the dollar. The partially convertible rupee was hovering at 76.1425, compared with its close of 75.91 during the previous trading session.

MCX Gold futures for 3 June 2022 settlement rose 0.65% to Rs 52,519.

The US Dollar index (DXY), which tracks the greenback`s value against a basket of currencies, rose 0.15% to 100.08.

In the commodities market, Brent crude for June 2022 settlement rose $4.20 at $102.68 a barrel.

Oil prices dropped on Monday amid fears that COVID lockdowns in China would depress global demand. International benchmark Brent crude declined 4.18% to settle at $98.48 per barrel.

Foreign Markets:

European markets declined while Asian stocks ended mixed on Tuesday. Investors were cautious ahead of European Central Bank (ECB) meeting on Thursday, and the release of US inflation data on Tuesday. Sharply climbing inflation and the ongoing Ukraine conflict also worried investors.

The World Health Organization said Monday it is monitoring the COVID-19 situation in mainland China, where officials have been battling a major surge in cases.

The major Chinese city of Shanghai has accounted for most of mainland China`s new COVID cases and was in lockdown about a week after a two-part shutdown was originally supposed to end.

US inflation data is expected to be out later Tuesday stateside and could provide more clues on the outlook for Federal Reserve policy.

Stocks in Spotlight:

Shares of shipbuilders were in demand. Garden Reach Shipbuilders & Engineers (up 15.42%), Mazagon Dock Shipbuilders (up 8.97%) and Cochin Shipyard (up 5.33%) surged.

TCS fell 0.13%. The IT major`s consolidated net profit rose 1.61% to Rs 9,926 crore on 3.49% increase in net sales to Rs 50,591 crore in Q4 March 2022 (Q4 FY22) over Q3 December 2021 (Q3 FY22). On a year-on-year (YoY) basis, the IT major`s net profit rose 7.35% and net sales rose 15.76% in Q4 FY22. Constant currency revenue grew 14.3% YoY in Q4 FY22. Operating margin stood at 25% while net margin was at 19.6% in Q4 FY22.

The company reported highest ever order book total contract value (TCV) of $11.3 billion in Q4 March 2022 and $34.6 billion in the year ended March 2022. The board recommended a final dividend of Rs 22 per share.

Escorts fell 3.74%. In an exchange filing on Tuesday, Escorts reported that Rakesh Jhunjhunwala tendered his 47,19,362 shares, or 3.57% equity, of Escorts in the open offer where Japanese agricultural machinery manufacturer, Kubota, plans to increase its stake and become a joint-promoter.

Jhunjhunwala`s name is absent from the latest shareholding pattern of Escorts, which was uploaded on the BSE website a few days ago. Listed companies are required to provide details of the shares held by investors whose shareholding in the company amounts to more than 1%.

Kubota is in the process of becoming a co-promoter of Escorts. The latest shareholding data shows that Kubota`s stake has increased to 55.82% from 16.39% as on 18 February 2022.

Adani Green Energy (AGEL) jumped 3.25% after the company said its total operational capacity increased by 56% YoY to 5,410 MW in Q4 March 2022. AGEL said its sale of energy increased by 84% YoY at 2,971 million units in Q4 FY22 as against 1,614 million units in Q4 FY21. This was backed by robust performance in both solar and wind portfolios.

Tata Motors fell 3.07%. The Group`s global wholesales in Q4 FY22, including Jaguar Land Rover (JLR), were at 3,34,884, rising 2%, as compared to Q4 FY21. Global wholesales of all Tata Motors` commercial vehicles and Tata Daewoo range in Q4 FY22 stood at 1,22, 147, higher by 12%, over Q4 FY21. Global wholesales of all passenger vehicles in Q4 FY22 stood at 2, 12,737, falling 4% as compared to Q4 FY22.

Global wholesales for Jaguar Land Rover were at 89,148 vehicles (JLR number for Q4 FY22 includes CJLR volumes of 12,622 units). Jaguar wholesales for the quarter stood at 19,570 vehicles, while Land Rover wholesales for the quarter were at 69,578 vehicles.

SPML Infra hit an upper circuit limit of 5% at Rs 69.45 after the company said that it has secured several arbitration awards of cumulated amount of about Rs 712 crore (including interest upto 30 September 2019) for the projects from different clients in India.

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