After a volatile day of trading, the Indian stock markets ended the day on a flat note. The BSE-Sensex closed higher by about 30 points or 0.1%, while the NSE-Nifty ended higher by about 5 points or 0.1%. Stocks from the FMCG and pharmaceutical spaces were amongst the top performers today, while those from the oil & gas and energy spaces were least in demand. The BSE Mid Cap and BSE Small Cap indices ended the day on a flat note as well.
Stock markets in other parts of Asia ended on a weak note with Japan, China and Hong Kong down by about 2.6%, 0.2% and 1.7% respectively. The rupee was trading at Rs 61.09 to the dollar at the time of writing.
FMCG stocks ended the day on a strong note with ITC and Godrej Consumer leading the pack of gainers. FMCG stocks have been under pressure off late on the back of concerns related to volume growth, which is expected to remain weak in short run. The demand slowdown has not bottomed out as yet. Hindustan Unilever (HUL), the FMCG giant registered a volume growth of mere 4% in 3QFY14. It is expected that the coming quarter may mirror a similar subdued performance. Moreover, while urban growth continues to remain weak, the growth volumes in rural markets have started witnessing early signs of de-growth. Weak consumer sentiments and input-cost inflation deterred the margins of the FMCG companies.
Export numbers for the month of February 2014 came below expectations. The numbers reported a first decline in a period of eight months. And with this, concerns over the future have started to erupt given the strengthening of the Rupee in recent times. As reported by the Business Standard, exports declined by 3.7% YoY to US$ 25.7 bn during the month of February 2014. As for the 11 month period ended February 2014, exports are up by 4.8% YoY to US$ 282.8 bn. Petroleum, engineering, gems and jewellery - which constitute of nearly 57% of the export basket (in February 2014) - reported a decline in trade during the month. India had set an export target of US$ 325 bn for the full year FY14. However, given that the 11 month figure is way below expectations, the chances of meeting the target seem minimal.