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Last trading day of week closes on lackluster note; Sensex slips over 150 points
Feb-20-2020

Last trading day of the week closed on lackluster note, with the Sensex and the Nifty ending lower by around 150 and 50 points, respectively. The start of the session was on a cautious note, impacted by the Reserve Bank of India (RBI) Governor Shaktikanta Das’ statement that the coronavirus outbreak will have a limited impact on India but the global GDP and trade will definitely get affected due to the large size of the Chinese economy. In afternoon deals, key benchmarks managed to keep their heads in green terrain for some duration, despite weak cues from the global markets.

But, in the last leg of the trade, losses got intensified over the street, amid Fitch Ratings’ report stating that with deceleration in growth and tight liquidity conditions, the country's financial institution sector may continue to face challenging operating environment. Traders overlooked a report that the CCEA approved a new central sector scheme ‘Formation and Promotion of Farmer Produce Organizations’ to form and promote 10,000 new FPOs in five years period from 2019-20 to 2023-24 with budgetary support of Rs 4,496 crore as part of its efforts to cut production cost and boost income of farming community.

On the global front, European markets were trading in red, as Germany's consumer confidence is set to ease slightly in March, as a modest gain in economic expectations were offset by moderate losses in income outlook and the propensity to buy. The forward-looking GfK consumer confidence index fell to 9.8 points for March from 9.9 in February.  Asian markets ended mixed, after Singapore wholesale trade declined in the fourth quarter. At current prices, domestic wholesale sales declined a seasonally adjusted 8.5 percent quarter-on-quarter in the fourth quarter, following a 0.2 percent fall in the previous quarter.

Back home, the automobile sector stocks ended higher, even after Federation of Automobile Dealers Associations (FADA) said that passenger vehicle (PV) retail sales in January declined 4.61 per cent to 2,90,879 units as compared to same month last year, hit by tepid response by end customers. Further, stocks related to the pharmaceutical industry remained in watch, as the Niti Aayog held a meeting with the captains of industry in the pharmaceutical sector to discuss the impact of disruption in supplies of active pharmaceutical ingredients (APIs) following the coronavirus outbreak in China.

Finally, the BSE Sensex slipped 152.88 points or 0.37% to 41,170.12, while the CNX Nifty was down by 45.05 points or 0.37% to 12,080.85.

The BSE Sensex touched high and low of 41,399.93 and 41,134.31, respectively and there were 12 stocks advancing against 18 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 0.40%, while Small cap index was up by 0.51%.

The top gaining sectoral indices on the BSE were Metal up by 0.90%, Telecom up by 0.55%, PSU up by 0.47%, Bankex up by 0.39% and Power up by 0.34%, while Energy down by 0.95%, Oil & Gas down by 0.78%, IT down by 0.75%, Consumer Durables down by 0.68% and FMCG down by 0.59% were the top losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 3.57%, Tata Steel up by 2.48%, SBI up by 2.31%, ONGC up by 1.13% and Power Grid up by 1.01%. On the flip side, Asian Paints down by 2.30%, Hindustan Unilever down by 1.85%, TCS down by 1.75%, Nestle down by 1.38% and Tech Mahindra down by 1.36% were the top losers.

Meanwhile, underlining the telecom crisis in India is not limited to adjusted gross revenue (AGR) related issues, Former Finance Secretary Subhash Chandra Garg has said the government should offer a one-time settlement scheme to the telecom companies to pay the principal due amount as per the AGR definition and waive the penal interest and penalties.

Subhash Chandra Garg also noted that the telecom business -- both voice and data -- is headed towards becoming a duopoly (Jio and Airtel) with the remaining two players, Vodafone Idea and BSNL-MTNL, hurtling towards eventual shutdown, which might as well be an abrupt collapse.

Former Finance Secretary also wondered whether the proposal of the government to put in billions of dollars (over Rs 70,000 crore) to revive BSNL-MTNL is advisable or not as the country is facing massive economic slowdown.

Meanwhile, the Supreme Court last week rejected a plea by telecom firms including Bharti Airtel and Vodafone Idea for extension in the payment schedule and asked them to deposit an estimated Rs 1.47 lakh crore in past dues for spectrum and licenses by March 17.

The CNX Nifty traded in a range of 12,152.00 and 12,071.45. There were 21 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Indusind Bank up by 3.40%, Zee Entertainment up by 3.29%, Tata Steel up by 2.37%, SBI up by 2.36% and Power Grid up by 1.25%. On the flip side, Cipla down by 2.41%, Asian Paints down by 2.12%, Hindustan Unilever down by 1.92%, TCS down by 1.79% and Tech Mahindra down by 1.60% were the top losers.

European markets were trading mostly in red; France’s CAC decreased 9.16 points or 0.15% to 6,102.08 and Germany’s DAX fell 25.49 points or 0.18% to 13,763.51, while UK’s FTSE 100 was up by 7.58 points or 0.1% to 7,464.60.

Asian markets ended mixed on Thursday as worries remained over the global economic impact from the corona virus outbreak. New cases in China slowed again with just 394 new cases from the previous day. Still, China has reported 74,576 total cases, with 2,118 deaths. Meanwhile, rise in corona virus cases in South Korea and Japan, offsetting hopes of further stimulus in China. Chinese stocks ended up after Chinese Central Bank (PBOC) cut its benchmark one-year loan prime rate by 10 basis points and the five-year loan prime rate by 5 basis points, as anticipated, adding to a slew of fiscal and monetary measures in recent weeks aimed at mitigating the economic damage. Further, Japanese stocks closed higher as a sharp sell-off in the yen helped lift exporters.

Asian Indices

Last Trade           

Change in Points

Change in %

Shanghai Composite

3,030.15
54.75
1.84

Hang Seng

27,609.16
-46.65
-0.17

Jakarta Composite

5,942.49
13.70
0.23

KLSE Composite

1,538.42

4.26

0.28

Nikkei 225

23,479.15
78.45
0.34

Straits Times

3,198.68
-15.03
-0.47

KOSPI Composite

2,195.50
-14.84
-0.67

Taiwan Weighted

11,725.09
-33.75
-0.29
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