Parliament logjam subdues equity markets

Mumbai, April 27 (IANS) The logjam in parliament, coupled with caution ahead of US monetary policy review and mixed Asian indices, depressed the Indian equity markets on Wednesday.

Consequently, the key indices of the Indian equity markets traded flat during the late-afternoon session.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) inched up 13 points or 0.16 percent, at 7,975.60 points.

The barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 25,956.42 points, traded at 26,055.30 points (at 3.00 p.m.) — up 48 points or 0.18 percent from the previous close at 26,007.30 points.

The Sensex has so far touched a high of 26,092.93 points and a low of 25,885.24 points during the intra-day trade.

The BSE market breadth was slightly tilted in favour of the bears — with 1,308 declines and 1,220 advances.

Both the key Indian indices had ended on a higher note during the previous trade session on Tuesday. The barometer index had gained 328 points or 1.28 percent.

Similarly, the NSE Nifty had risen by 108 points or 1.37 percent.

Initially on Wednesday, the key indices opened on a negative note in-sync with their Asian peers.

Investors were seen cautious ahead of the US FOMC (US federal open market committee) meet and the Bank of Japan (BoJ) monetary policy review.

The US FOMC meet assumes significance as it will decide the future course of the US interest rates. A hike in interest rates is expected to lead away Foreign Portfolio Investors (FPIs) from emerging markets such as India.

Besides, unwinding of long positions ahead of the futures and options (F&O) expiry dented sentiments.

Even the ongoing logjam in parliament dampened sentiments. Investors are worried that the logjam might postpone key economic legislation from getting passed.

However, the equity markets pared their initial losses, as value buying at lower levels and healthy fourth quarter (Q4) results lifted prices.

In addition, rising crude oil prices supported the equity markets’ upward movement.

“Follow through buying from yesterday’s rally and the healthy quarterly results lifted prices. Rising oil prices also supported the uptrend,” Anand James, chief market strategist, Geojit BNP Paribas Financial Services, told IANS.

“However, investors were cautious ahead of several event risks like the FOMC meet, BoJ’s monetary policy review and F&O exipry. Parliament’s logjam also dampened sentiments.”

According to Vaibhav Agarwal, vice president and research head at Angel Broking, demand for telecom stocks surged ahead of the release of Bharti Airtel’s Q4 results.

“Telecom major Bharti Airtel was up 2.3 percent ahead of its Q4 results today, along with Mahindra & Mahindra (M&M) which rose one percent after the company announced the launch of a new pick-up vehicle under the name Big Bolero Pik-up,” Agarwal said.

“Even Yes Bank posted there number above expectation.”

–IANS

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