Benchmarks continue to trade in red amid concerns of below normal monsoon

Indian bourses continued to trade in red in late morning session as funds and retail investors indulged in booking profits at prevailing levels amid forecast of below normal monsoon this year. Most of major indices were trading in red and selling was witnessed in front line blue chip stocks that took the markets to lower levels. Traders were seen piling positions in Healthcare, Metal and Oil & Gas stocks while selling was witnessed in Realty, Auto and Bankex sector stocks. On global front, most of Asian equity indices were trading in red due to rising tensions in Ukraine and as investors awaited the outcome of the US Federal Reserve’s policy meeting later this week. Economists expect the Fed to further cut its stimulus programme following a string of figures showing the economy is improving. Stocks on Wall Street ended lower on Friday amid weak corporate earnings while the emerging crisis in Ukraine also weighed on investor sentiment.

Back home, IDFC was the top loser on Nifty, down over 2%, as its March quarter earnings disappointed the street. UPL surged 9% to Rs 252 after reporting a robust 28% year-on-year growth in adjusted consolidated net profit at Rs 405 crore for the fourth quarter ended March 31, 2014. Meanwhile, Pharma stocks gained as rupee edged lower against the dollar with Lupin hitting record high. The market breadth on BSE was positive, out of 2053 stocks traded, 1076 stocks advanced, while 880 stocks declined on the BSE.

The BSE Sensex is currently trading at 22630.46 down by 57.61 points or 0.25% after trading in a range of 22,721.36 and 22,620.42. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.17%, while Small cap index gained 0.32%.

The top gaining sectoral indices on the BSE were Healthcare up by 1.06%, Metal up by 0.26%, Oil & Gas up by 0.14%, Power up by 0.08% and IT up by 0.07%. While, Realty down by 0.69%, Auto down by 0.67%, Bankex down by 0.59%, Capital Goods down by 0.53% and PSU down by 0.04% were the losing indices on BSE.   

The top gainers on the Sensex were Dr Reddys Lab up by 1.25%,  Sun Pharma up by 1.11%, Tata Steel up by 1.04%, Cipla up by 0.88% and SSLT up by 0.78%. On the flip side, Gail India down by 1.69%, BHEL down by 1.65%, Tata Motors down by 1.46%, Bharti Airtel down by 1.44% and ICICI Bank down by 1.16%.

Meanwhile, many of the top industrial groups are likely to get a reprieve in the coal blocks allotment case with all likelihood of Central Vigilance Commission (CVC) backing CBI’s recommendation for closing about 20 preliminary enquiries (PEs) filed against some top industrialists.

The Apex Court a month earlier directed CVC to peruse the coal blocks allocation cases, wherein there were a difference of opinion within CBI on the closure issue and further towards this development, the superintending body over CBI has reviewed files relating to these cases and is likely to support the probe agency in its report to be filed in the apex court early next month. However, the commission is also likely to get its report evaluated by legal experts before filing it in the court next week.

The apex court's directives to CVC came right after filing of two closure reports last month in coal blocks cases, in which DIG Ravi Kant, who supervises the probe along with other two officers of the same rank had given opinion for filing of charge sheets. The court then hearing coal block cases, had late last month asked Central Vigilance Commissioner and two vigilance commissioners to put out their suggestions on whether the cases could be closed or charge sheets should be filed.

In total, there are about 20-22 PEs in which CBI officers, both investigating and supervising, have divergent views and currently the agency is probing at least 16 cases of alleged misappropriation in coal blocks allocation.

The CNX Nifty is currently trading at 6,759.85 down by 22.90 points or 0.34% after trading in a range of 6,783.20 and 6,759.30. There were only 17 stocks advancing against 31 declining ones and two stocks remained unchanged on the index.

The top gainers of the Nifty were Sun Pharma up by 1.37%, Lupin up by 1.33%, Dr. Reddy's Laboratories up by 1.17%, Tech Mahindra up by 1.02% and Cipla up by 0.89%. On the flip side, IDFC down by 2.50%, Ambuja Cements down by 2.44%, BHEL down by 2.22%, Gail down by 1.71% and Bharti Airtel  down by 1.67% were the major losers on the index.

Most of the Asian equity indices were trading in red; Shanghai Composite slipped 1.28%, Hang Seng declined by 0.33%, KLSE Composite down by by 0.37%, Jakarta Composite was down by 1.03%, Straits Times decreased by 0.22% and Nikkei 225 was down by 1.16%.

On the flip side, Seoul Composite gained 0.19% and Taiwan Weighted was up by 0.41%.