Auto, pharma stocks decline

Weakness persisted on the bourses in afternoon trade. At 13:17 IST, the barometer index, the S&P BSE Sensex, was down 181.02 points or 0.7% at 25,657.12. The Nifty 50 index was currently down 52.85 points or 0.67% at 7,846.45. Weakness in global stocks spoiled investors' sentiment.

The Sensex fell 191.23 points, or 0.74% at the day's low of 25,646.91 in afternoon trade, its lowest level since 18 April 2016. The barometer index rose 52.89 points, or 0.2% at the day's high of 25,891.03 in early trade. The Nifty fell 58.80 points, or 0.74% at the day's low of 7,840.50 in early afternoon trade, its lowest level since 13 April 2016. The index rose 11.70 points, or 0.15% at the day's high of 7,911 in early trade.

The market breadth indicating the overall health of the market was weak. On BSE, 1,448 shares fell and 955 shares rose. A total of 139 shares were unchanged. The BSE Mid-Cap index was currently down 0.23%. The BSE Small-Cap index was currently down 0.39%. The decline in both these indices was lower than the Sensex's decline in percentage terms.

In overseas stock markets, European stocks fell amid declining oil prices and as investors eyed the release of German business climate data. Asian shares edged lower as investors awaited central bank meetings in the United States and Japan this week. The Bank of Japan (BOJ) holds a two-day monetary policy meeting on Wednesday, 27 April 2016 and Thursday, 28 April 2016. Market participants are becoming more confident in their expectations of further easing from the Bank of Japan. The BOJ in January decided to begin charging 0.1% interest on some bank reserves parked with the institution, in a bid to kick-start the economy and pull it out of two decades of deflation.

US stocks finished mixed during the previous trading session on Friday, 22 April 2016, as earnings misses in the previous session from Microsoft and Google parent Alphabet slackened optimism on Wall Street. The US Federal Reserve holds a two-day policy meeting on Tuesday, 26 April 2016 and Wednesday, 27 April 2016. As per market expectations, the Fed is likely to hold rates steady this week and instead will opt to raise the federal funds rate by 25 basis points in its June meeting to 0.5-0.75% in what will be the second in its first series of rate rises in nearly a decade.

Index heavyweight and cigarette major ITC fell 1.03% to Rs 322.35. The stock hit a high of Rs 325.50 and low of Rs 321.85 so far during the day.

Auto stocks declined. Tata Motors (down 1.1%), Mahindra & Mahindra (M&M) (down 0.25%), Eicher Motors (down 0.98%), Hero MotoCorp (down 0.79%) and TVS Motor Company (down 2.61%) declined. Bajaj Auto (up 1%) and Ashok Leyland (up 0.57%) rose.

Car major Maruti Suzuki India dropped 2.03% as Japanese yen strengthened against the dollar on expectations of further easing from the Bank of Japan. A strong yen adversely impacts Maruti's operating profit margin. Maruti pays royalty to its Japanese parent Suzuki Motor Corporation in yen terms for some of its earlier models. As per recent media reports, Maruti will start paying royalty to its Japanese parent in rupee term on all new models from the current financial year, which began on 1 April 2016. Maruti also has an exposure to the yen to the extent it imports raw materials from Japan. Maruti is scheduled to announce its Q4 March 2016 results tomorrow, 26 April 2016.

Pharma stocks edged lower. Cipla (down 1.22%), Dr Reddy's Laboratories (down 0.73%), Cadila Healthcare (down 0.85%), Lupin (down 1.08%), Sun Pharmaceutical Industries (down 1.3%), Alkem Laboratories (down 0.24%), Aurobindo Pharma (down 1.6%) and Wockhardt (down 0.91%) declined. Glenmark Pharmaceuticals (up 1.72%) and GlaxoSmithKline Pharmaceuticals (up 0.15%) rose.

Honda Siel Power Products rose 1.17% after the company announced that it has launched indigenously built power tiller to cater to the vast domestic market as well as other emerging markets globally. Honda Siel Power Products said that the product was launched as a part of government's Make in India initiative and renewed thrust on farm mechanization. The announcement was made on Saturday, 23 April 2016.

Filatex India was locked at 20% upper circuit at Rs 51.80 after net profit surged 364% to Rs 13.55 crore on 29.6% growth in net sales to Rs 348.57 crore in Q4 March 2016 over Q4 March 2015. The result was announced after market hours on Friday, 22 April 2016.

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