Benchmarks continue to trade lower in late morning

Indian equity benchmarks continued to trade lower after making a weak start in early deals on friday, as investors opted to book profits ahead the general elections scheduled to start next week. Sentiments on street were down since early morning on the report showing a bigger than expected increase in weekly jobless claims in US. Sentiments also got dampened on International Monetary Fund’s report stating that India’s declining economic growth, which has touched a decade's low of 4.5 percent in 2012-13, is mainly due to internal factors. In its World Economic Outlook, it said that External factors have generally been much less important compared with internal factors for relatively large or closed economies such as China, India and Indonesia. Further, depreciating rupee also added to pessimistic sentiments.

On the global front, Most of the Asian markets were trading lower at this point of time, awaiting US payrolls data, a much stronger numbers could reignite speculation of an earlier rate hike from the US Fed. Back home, traders were buying, Realty, Consumer Durables and Metal stocks, while selling was seen in Capital Goods, Oil & Gas and Auto.

The market breadth on BSE remains positive with advances to declines in the ratio of 1168:764. BSE Sensex and NSE Nifty were comfortably trading near their psychological 22,300 and 6,700 levels respectively.

The BSE Sensex is currently trading at 22391.61 down by 117.46 points or 0.52% after trading in a range of 22525.21 and 22378.49. There were 10 stocks advancing against 20 declines on the index. The broader indices were trading in green; the BSE Mid cap index was up by 0.38% and Small cap index up by 0.60%.

The top gaining sectoral indices on the BSE were, Realty up by 1.27%, Consumer Durables up by 0.91%, Metal up by 0.68%, IT up by 0.34% and Teck up by 0.23%, while Capital Goods down by 1.11%, Oil & Gas down by 1.10%, Auto down by 0.82%, Bankex down by 0.57% and Power down by 0.50% were the top losers on the sectoral index.

The top gainers on the Sensex were Hindalco up by 1.06%, Coal India up by 1.03%, Tata Steel up by 0.97%, Cipla up by 0.69% and Wipro up by 0.45%. On the flip side, Gail India was down by 2.49%,  BHEL was down by 2.27%, ONGC was down by 1.56%, L&T was down by 1.47% and  Tata Motors was down by 1.12% were the top losers on the Sensex.

Meanwhile, The Reserve Bank of India (RBI) Governor Raghuram Rajan expressed need for India to match China in accumulating foreign exchange reserves. RBI’s Governor has asserted that the economy cannot be said to be insulated from external shocks, unless foreign domestic exchange reserves rise to the level of China.

Raghuram Rajan stressed that India’s current level of forex reserves are probably not enough to feel safe. Presently, the central bank has $300 billion foreign reserves whereas China's foreign exchange reserves stood at staggering $3.66 trillion as of end 2013, making it the largest in the world. Since Raghuram Rajan assumed office on September 4, the RBI reserve has increased by $25 billion to $300 billion as of March 31. The reserves had surged to an all-time high of $322 billion in September 2011.

The Governor further emphasized that the central bank's intervention in the foreign exchange market is only to curb volatility caused by the higher inflows or outflows and to intervene perfectly the central bank need plenty of reserves. Besides building forex reserves, there is also need to focus on creating policy environment which boosts investor confidence adding that RBI has been taking measures to boost confidence.

The CNX Nifty is currently trading at 6,704.70 down by 31.40 points or 0.47% after trading in a range of 6,741.85 and 6,699.25. There were 18 stocks advancing against 32 declines on the index.

The top gainers of the Nifty were IDFC up by 1.72%, DLF up by 1.46%, Coal India up by 1.27%, Jindal Steel up by 1.14% and Tata Steel up by 1.13%. On the flip side, Gail down by 2.39%, BHEL down by 2.38%, L&T down by 1.63%, ONGC down by 1.62% and Asian Paint down by 1.41% were the top losers on the index.

Most of the Asian equity indices were trading in red; Hang Seng declined by 57.50 points or 0.25% to 22,507.58, Jakarta Composite dropped by 43.22 points or 0.88% to 4,848.10, Nikkei 225 crumbled 24.37 points or 0.16% to 15,047.51, Straits Times slipped by 4.39 points or 0.14% to 3,215.67 and KOSPI Composite was down by 7.31 points or 0.37% to 1,986.39. On the flip side, Shanghai Composite increased by 5.25 points or 0.26% to 2,048.95 and KLSE Composite was up by 2.16 points or 0.12% to 1,857.79.

Taiwan markets remained shut for the trade today for Children's Day holiday.