Down by profit booking in heavy weights, the Indian Indices traded lower for major part of the day today. Reeling under pressure, the markets closed the day on a weak note. Ahead of quarterly earnings and inflation data scheduled next week, the blue chip companies reported severe selling pressures. Stocks from sectors such as oil and gas, banks and automobiles have languished in red today. Notably, the BSE Small Cap and BSE Mid Cap indices outshined the benchmark indices and were up by 0.6% and 0.1% respectively. The BSE Sensex closed lower by 86 points and the NSE-Nifty was down by 20 points.
On the global front, most of the Asian indices have closed the day on a weak note and even the European indices have opened the day on a pessimistic note. The rupee was trading at Rs 60.22 to the dollar at the time of writing.
Except Escorts, all the stocks from the Automobile space have closed the day in red. Leading the pack of losers were Eicher Motors and Hero Motocorp. As per a leading financial daily, rating agency ICRA has stated that the commercial vehicle (CV) industry is set to close FY15 at 6,36,000 units. This implies a 19.7% de-growth vis-a-vis the previous year. The agency also expects CV industry volumes lower than the industry size in 2010-11. Moreover, the sales volume in the M&HCV segment is expected to be lower than that reported in 2004-05. Therefore, M&HCV segment is expected to recover only in 2HFY15. The CV industry is undergoing prolonged down cycle currently. The industry volumes have declined by 2% in FY13 and FY14 have witnessed sharp contraction of 19.7%. The demand for LCVs have also shrunk by 16.6% during FY14. Continued economic slowdown and weak consumer sentiments have been largely responsible for the downturn in the CV market.
A leading financial daily reports that India's merchandise exports have contracted for the second month in a row in March. Notably, the imports have declined and have helped narrow the trade deficit easing the external pressures and the rupee volatility. The exports in the month of March have fallen by 3.15% to US dollars 29.6 bn while the imports have gone down by 2.11% to US dollars 40.1 bn. In February, the Indian exports had contracted 3.7% to US dollars 25.6 bn for the first time in 8 months. This drag came on account of slowdown in sectors such as petroleum, engineering and pharmaceuticals.