Key benchmark indices settled with small losses in a highly volatile session of trade. The barometer index, the S&P BSE Sensex, fell 25.36 points, or 0.07%, at 33,819.50, as per the provisional closing data. The Nifty 50 index fell 14.75 points, or 0.14%, to 10,382.70, as per the provisional closing data. Telecom stocks declined. Weakness in global stocks weighed on sentiment.
Volatility zoomed in second half of day's trading session as traders rolled over positions in the F&O segment from the near month February 2018 series to March 2018 series. The February 2018 F&O contracts expired today, 22 February 2018.
After opening with downward gap triggered by negative Asian cues, domestic stocks staged a short-lived recovery in mid-afternoon trade. The recovery was derailed soon. However, stocks once staged a comeback and managed to cut most of intraday losses in late trade.
Meanwhile, the minutes of the last meeting of the Reserve Bank of India (RBI) held on 6-7 February 2018 showed that monetary policy committee members were concerned about accelerating inflation as well as uncertainty about the strength of an economic recovery.
The Sensex rose 23.88 points or 0.07% at the day's high of 33,868.74. The index lost 153.44 points or 0.45% at the day's low of 33,691.42, its lowest level since 20 February 2018. The Nifty rose 0.10 points at the day's high of 10,397.55. The index lost 56.80 points or 0.55% at the day's low of 10,340.65, its lowest level since 19 February 2018.
The S&P BSE Mid-Cap index provisionally fell 0.54%. The S&P BSE Small-Cap index provisionally declined 0.43%. Both these indices underperformed the Sensex.
The market breadth, indicating the overall health of the market, was weak. On the BSE, 1,698 shares fell and 1,027 shares rose. A total of 159 shares were unchanged. Breadth was weak till morning trade. It turned negative in mid-morning trade.
The total turnover on BSE amounted to Rs 3454.78 crore, lower than the turnover of Rs 3464.96 crore registered during the previous trading session.
Telecom stocks declined. Idea Cellular (down 2.22%), Bharti Airtel (down 1%), Tata Teleservices (Maharashtra) (down 2.4%) and Reliance Communications (down 2.68%) fell. MTNL (up 7.78%) surged.
Shares of Bharti Infratel fell 1.02%. Bharti Infratel is a provider of tower and related infrastructure and is a unit of Bharti Airtel.
Mahindra & Mahindra (M&M) gained 2.05%. M&M said that it has signed a share subscription & shareholders agreement and a share purchase agreement for acquisition of up to 1,296 equity shares and subscribing upto 6,074 compulsory convertible cumulative preference shares which on an as-converted to equity share basis, would result in the company holding in aggregate 22.9% of the equity share capital of Carnot Technologies on a fully diluted basis. The announcement was made after market hours yesterday, 21 February 2018.
Carnot Technologies is an Indian company, which provides products and services related to internet connected devices for monitoring performance of vehicles and equipment. It had a turnover of Rs 1.2 crore for FY 2016-17.
Acquisition of shares in Carnot is expected to support company's businesses by developing information technology solutions for its products. The indicative time period for completion of the acquisition is 31 March 2018. The cost of acquisition is Rs 6.06 crore.
K P R Mill rose 4.35% to Rs 723.95 after the company said its board approved the proposal to buyback not exceeding 13.35 lakh equity shares of the company, representing 1.81% of the paid-up share capital, at Rs 810 each. The total buyback size will not exceed Rs 108.13 crore, which is 10% of the fully paid-up equity share capital and free reserves of the company as on 31 March 2017. The announcement was made during trading hours today, 22 February 2018.
Steel Strips Wheels rose 0.55% after the company announced commissioning of its Chennai truck wheel plant from February 2018. This plant will add 1.2 million wheels capacity to the already existing 1.8 million wheels capacity for the truck/trailer segment of the company. The total capacity of truck wheel segment now stands at 3 million wheels and with this the company will be the largest truck steel wheel maker in India. The announcement was made during trading hours today, 22 February 2018.
Meanwhile, the minutes of the Monetary Policy Committee (MPC) meeting held on 6.-7 February 2018 released yesterday, 21 February 2018, showed that though prices eased in December, the winter seasonal food price moderation was less than usual. Domestic pump prices of petrol and diesel rose sharply in January, reflecting lagged pass-through of the past increases in international crude oil prices. Considering these factors, inflation is now estimated at 5.1% in Q4, including the house rent allowance (HRA) impact. The RBI had kept the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6% in the last meet.
The MPC noted that the inflation outlook is clouded by several uncertainties on the upside. There is, therefore, need for vigilance around the evolving inflation scenario in the coming months, it added.
Overseas, European stocks were trading lower while US equity futures dropped in reaction to minutes from the Federal Reserve's last policy meeting. Meanwhile, trading of US index futures indicated that the Dow could fall 104 points at the opening bell today, 22 February 2018.
Most Asian shares slipped as speculation of faster hikes in US interest rates soured risk appetite globally. US stocks ended a tumultuous session yesterday, 21 February 2018 firmly lower after minutes from the Federal Reserve's most recent policy-setting meeting sparked a fresh wave of volatility. Minutes of the January 30-31 Federal Open Market Committee meeting showed that officials saw a stronger economy than at the end of 2017 and that more rate increases were in the offing.
An index that tracks US manufacturers rose to a nearly 3-year high in February and a gauge for service-oriented companies hit a six-month peak, according to IHS Markit's flash PMI. The manufacturing index rose to 55.9 from 55.5. The services barometer climbed to 55.9 from 53.3.
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