Benchmarks trim losses; trade continues in red

Indian equity benchmarks trimmed losses however continued their weak trade in the late afternoon session on account of selling in frontline counters. The sentiments were pessimistic despite services-sector activity in India expanded for the first time in 11 months in May, thanks to an increase in new orders. Traders were seen piling up positions in Consumer Durables, Auto and Capital Goods stocks, while selling was witnessed in IT, TECK and Oil & Gas sector stocks. In scrip specific development, Wockhardt was trading under pressure on reports that the US regulator has identified deficiencies in quality, hygiene and personnel training standards at the company’s Morton Grove manufacturing unit at Illinois in the US. Reliance Industries was trading under pressure after foreign brokerage firm downgraded the company to neutral from overweight, saying share prices already reflect positive catalysts even as fundamentals remain on a solid footing. Sequent Scientific extended gains after several foreign institutional investors acquired over 1.2 million shares in the pharmaceutical and speciality chemicals firm.

On the global front, the Asian markets were trading mostly in red, while the European markets traded on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 7,450 and 24,900 levels respectively. The market breadth on BSE was positive in the ratio of 2017:905 while 89 scrips remained unchanged.

The BSE Sensex is currently trading at 24829.74, down by 28.85 points or 0.12% after trading in a range of 24,925.90 and 24778.79. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.47%, while Small cap index up by 1.53%.

The gaining sectoral indices on the BSE were Consumer Durables up by 1.19%, Auto up by 1.10%, Capital Goods up by 0.97%, Realty up by 0.88% and Bankex up by 0.48% while, IT down by 1.51%, TECK down by 1.17%, Oil & Gas down by 0.68%, FMCG down by 0.22% and HealthCare down by 0.01% were the losing indices on BSE.   

The top gainers on the Sensex were Herp Motocorp up by 4.12%, Hindalco Industries up by 2.45%, HUL up by 1.85%, Tata Steel up by 1.68% and Bajaj Auto up by 1.68%. On the flip side, TCS down by 2.09%, Bharti Airtel down by 1.32%, Coal India down by 1.18%, Infosys down by 1.17% and SSLT down by 1.09% were the top losers.

Meanwhile, in order to meet the rising domestic coal requirements, Coal India has planned to form a panel of consultants which would help it in acquiring, developing and operating coal mines overseas.

Coal India is eyeing coal assets abroad to meet the domestic demand. Earlier, Coal Ministry had stated that acquisition of coal mines overseas should be done in an aggressive manner to meet India’s rising energy requirements. Taking forward its plans to acquire overseas mines, CIL had recently invited bids for the third phase of drilling in the African nation. It had earlier invited bids from bankers and interested parties for acquiring assets abroad.

India, despite being world’s third-largest producer of coal and fifth largest in terms of reserves, has failed to keep pace with increasing domestic demand. Indian domestic coal demand is around 35 percent higher than domestic supply, resulting into a high deficit of which a huge part is being met by costly imports from Indonesia, South Africa and Australia. The country had imported a record 171 MT coal last financial year to meet domestic requirements. Meanwhile, to boost the domestic coal production, the government has planned to invite bids from private players to start coal mining in a public-private partnership (PPP) mode in the country, which would also end the monopoly of public sector unit Coal India.

The CNX Nifty is currently trading at 7,408.25, down by 7.60 points or 0.10% after trading in a range of 7,433.30 and 7,393.60. There were 25 stocks advancing against 24 declining ones while 1 stock remained unchanged on the index.

The top gainers of the Nifty were Hero MotoCorp up by 4.01%, NMDC up by 2.74%, Hindalco Industries up by 2.61%, Bank of Baroda up 2.33% and PNB up by 2.12%. On the flip side, HCL Tech down by 2.95%, TCS down by 2.13%, Bharti Airtel down by 1.71%, Infosys down by 1.40% and Sun Pharma down by 1.38% were the major losers on the index.

Asian equity indices were trading mostly in red; Hang Seng down by 0.60%, Taiwan Weighted down by 0.04%, Shanghai Composite down by 0.66%, Jakarta Stock Index down by 0.34% and Straits Times down by 0.45%. While, Nikkei 225 up by 0.22% was the top gainer on the index.

South Korea market was closed today on account of ‘Regional Election Day’ holiday.

The European markets were trading in red; France’s CAC 40 was down by 0.24%; UK’s FTSE 100 lost 0.16% and Germany’s DAX was down by 0.06%.