13720Tata Punch Overtakes Maruti’s Wagon R

Sharp fall in crude price and US bond yields reflected the rising concern over fall in future growth.

Domestic equity benchmarks declined for second trading session on Friday. Resurgent worries about rising US bond yields hit global stocks. Firm crude oil prices also spooked investors. Higher crude oil prices could increase fiscal deficit, current account deficit and stoke fuel price inflation. The Nifty closed below the crucial 15,000 mark.

Sensex, tumbled 440 points or 0.87% at 50,405. The Nifty50 index slumped 142 points or 0.95% at 14,938. Both these indices have fallen a little over 2% each in two consecutive sessions.

ICICI Bank (down 1.80%), HDFC (down 1.55%), HDFC Bank (down 1.52%) and Infosys (down 1.07%) were major drags today.

Selling was broad-based. The S&P BSE Mid-Cap index fell 1.89% and the S&P BSE Small-Cap index tumbled 1.50%. Both these indices saw profit-taking after rallying over 5% in the past four days.

The market breadth was weak. On the BSE, 1,057 shares rose and 1,929 shares fell. A total of 143 shares were unchanged.

“Domestic equities corrected for second consecutive day as rise in 10-Year USA Treasury yields and commentary from Federal Reserve chairman on rising bond yields weighed on investors’ sentiments. Barring FMCG, all key sectoral indices witnessed sharp pullback with metals and PSU bank indices witnessing steeper correction in the range of 3-4 per cent,” said Binod Modi, Head – Strategy at Reliance Securities.

Clearly, rising bond yield fear, which appeared to have softened last week, has come to the fore again with back-to-back sharp rise in USA treasury yields, he said, adding that a higher bond yield reduces future earnings or cash flow projections and therefore premium valuations of equities become doubtful.

New listing

Shares of Heranba Industries closed at Rs 812.25 per share on the BSE, at a premium of 29.55% as compared to the issue of Rs 627 apiece. The stock was listed at Rs 900, a premium of 43.54% to the initial public offer (IPO) price. The stock hit a high of Rs 944.95 and low of 796.35. On the BSE, 17.15 lakh shares were traded on the counter. The IPO of Heranba Industries The issue was subscribed 83.29 times. The issue opened for bidding on 23 February 2021 and closed on 25 February 2021. The price band for the IPO was set at Rs 626-627 per share.

Primary market

The initial public offer (IPO) of MTAR Technologies received bids for 145.78 crore shares as against 72.60 lakh shares on offer, according to the stock exchange data at 17:00 IST on Friday. The issue was subscribed 200.79 times.

The issue opened for bidding on Wednesday, 3 March 2021, and it will close on Friday, 5 March 2021. The price band for the IPO is set at Rs 574-575 per share. An investor can bid for a minimum lot of 26 equity shares and in multiples thereof.

On the forex market front, the rupee closed 19 paise lower at 73.02 against the US dollar. Global crude oil benchmark Brent was trading 1.26 per cent higher at USD 68.11 per barrel.

Global markets

Shares in Europe and Asia declined on Friday amid rising bond yields.

The Chinese government has set its 2021 economic growth target at more than 6%, Premier Li Keqiang said in his annual work report on Friday at the opening of this year’s meeting of parliament. China did not set a gross domestic product target last year due to uncertainties arising from the pandemic. The government has set its 2021 target for consumer price inflation at around 3% and its budget deficit goal of around 3.2% of GDP, Li said.

US stocks fell sharply on Thursday after Federal Reserve Chair Jerome Powell failed to reassure investors that the central bank would keep surging bond yields and inflation expectations in check.

The 10-year Treasury yield, which has been keeping investors on edge in recent weeks, jumped to 1.54% after Powell’s remarks. Last week, the benchmark 10-year soared to a high of 1.6% in a sudden move that sparked a big sell-off in stocks.

(With inputs from PTI)