Benchmarks continue weak trade; FMCG drag

Indian equity benchmarks continued their weak trade in the late afternoon session on account of selling in frontline blue chip counters. The market even overlooked Finance Minister P Chidambaram’s statement that Indian economy will strengthen in future on the back of recent measures taken by the government. Investors have started taking cautious approach ahead of the outcome of the currently underway national elections due on May 16, along with concerns over Ukraine. Traders were seen piling positions in HealthCare, Realty and Bankex stocks, while selling was witnessed in FMCG, Capital Goods and Auto sector stocks. In scrip specific development, DB Realty was trading under pressure after the company was named in charge sheet filed by the Enforcement Directorate in a money laundering case related to 2G case. Fulford India was locked at upper circuit limit after its promoter Dashtag made voluntary delisting offer at an indicative price of Rs 1,150 which is a sharp 67% premium to Friday’s close price.

On the global front, the Asian markets were trading mostly in red, while the European markets were trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 6,800 and 22,700 levels respectively. The market breadth on BSE was neutral in the ratio of 1297:1298 while 135 scrips remained unchanged.

The BSE Sensex is currently trading at 22647.76, down by 40.31 points or 0.18% after trading in a range of 22721.36 and 22597.19. There were 14 stocks advancing against 16 declining ones on the index.

The broader indices were trading in green; with BSE Mid cap index trading higher by 0.78% and Small Cap index gaining 0.30%.

The gaining sectoral indices on the BSE were HealthCare up by 1.61%, Realty up by 0.37%, Bankex up by 0.37%, Power up by 0.10% and Information Technology (IT) up by 0.07%, while FMCG down by 0.78%, Capital Goods down by 0.67%, Auto down by 0.58%, Metal down by 0.16% and Consumer Durables down by 0.12% were the top losing indices on BSE.   

The top gainers on the Sensex were Cipla up by 2.98%, Wipro up by 1.78%, Dr. Reddy’s Lab up by 1.70%, Sun Pharma up by 1.57% and SSLT up by 0.91%.

On the flip side, Gail India down by 2.10%, BHEL down by 1.86%, Hindustan Unilever down by 1.74%, Hero MotoCorp down by 1.69% and Coal India down by 1.47%.

Meanwhile, planning commission is unlikely to suggest any cut in 8 percent annual average growth target for the 12th Plan despite the fact that Indian economy performed below average in the first two years of this period. Meanwhile, in order to achieve annual average growth of 8 percent in the 12th Plan period, domestic economy will have to grow at over 12 percent in 2015-16 and 2016-17 which is difficult.

Planning Commission's internal meeting to be headed by Prime Minister Manmohan Singh on April 29 would deliberate on the draft mid-term appraisal document for the 12th Plan and may refrain from suggesting any cut in growth target set for 12th Five Year plan. The mid-term review of 12th Plan will be conducted in the end of this year and the new government formed after general elections will bear the onus of revising the growth target. The term of Commission will also expire with the present government, and new government will constitute the new Planning Commission.

Presently, Indian economy is struggling with slowdown and its growth slowed down to a decade low at 4.5 percent in FY13 and 4.6 percent during the first three quarter of FY14. The factors like high interest rate, low investments and slow execution of infrastructure projects have been impacting economy’s growth.  The Central Statistics Office (CSO) expects the Indian economy to grow at 4.9 percent in FY14. Reserve Bank projected Indian economy growth at 5-6 percent during FY15. 

The CNX Nifty is currently trading at 6,766.80, down by 15.95 points or 0.24% after trading in a range of 6,786.25 and 6,750.30. There were 20 stocks advancing against 28 declining ones while 2 stocks remained unchanged on the index.

The top gainers of the Nifty were Cipla up by 2.93%, Kotak Bank up 2.04%, Wipro was up 1.91%, Sun Pharma up by 1.88% and Dr. Reddy’s Lab up by 1.68%.

On the flip side, Ambuja Cement down by 3.76%, Gail down by 2.36%, BHEL down by 2.28%, Asian Paints down by 2.13% and ACC down by 2.08% were the major losers on the index.

Asian equity indices were trading in red; Hang Seng down by 0.41%, Shanghai Composite down by 1.62%, Straits Times was down by 0.85%, Nikkei 225 down by 0.98% and Jakarta Composite plunged 1.35%. On the flip side, Taiwan Weighted was up by 0.41%.

The European markets were trading in green; France’s CAC 40 was up 0.56%, Germany’s DAX added 0.56% and UK’s FTSE 100 gained 0.35%.