Markets continue to trade slightly in red

Indian equity benchmarks continued to trade marginally in red in the afternoon session dragged down by selling witnessed in oil and gas, banking and FMCG stocks. Sentiments got a hit as UNCTAD's World Investment Report 2014 stated that India has slipped by one place to the fourth position in latest ranking of most favoured destinations for investment by global corporations. There was also cautiousness among the investors ahead of tomorrow's monthly expiry in the derivatives segment. However, market losses remained capped amid gain in auto, healthcare and consumer durables stocks. Shares of finance companies, which provide loans against gold rally after the RBI allowed banks to engage non-deposit-taking non-banking finance companies as banking correspondents for financial inclusion. The broader markets were outperforming the benchmarks with both mid cap and small cap indices trading up by 0.15%.

DLF stock was down nearly 2% at Rs 215.20 after a fair trade regulator CCI ordering a fresh probe against the company. AstraZencea Pharma India was down around 2.5% to Rs 1,124 on reports that the capital market regulator directed stock exchanges to monitor the delisting process of the drug maker. On the other hand, Zicom Electronic Security Systems, extending its previous day’s nearly 20% rally, has soared around 11% to Rs 125, on back of heavy volumes on the bourses.

On global front, Asian equity indices were trading mixed with Hang Seng up by 0.01% and Nikkei down by 0.69% on concerns about the escalating conflict in Iraq. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 7,500 and 25,000 levels respectively. The market breadth on BSE was positive, out of 2,657 stocks traded, 1,393 stocks advanced, while 1,146 stocks declined on the BSE.

The BSE Sensex is currently trading at 25,323.41 down by 45.49 points or 0.18% after trading in a range of 25,427.80 and 25,315.82. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.33%, while Small cap index up by 0.18%.

The gaining sectoral indices on the BSE were Auto up by 0.49%, Healthcare up by 0.47%, Consumer Durables up by 0.45%, Power up by 0.32% and IT up by 0.32%. On the flip side, Oil and Gas down by 0.79%, Bankex down by 0.39%, Infrastructure down by 0.37%, FMCG down by 0.35%, Capital Goods down by 0.24% and Realty down by 0.06% were the losing indices on BSE.    

The top gainers on the Sensex were Bajaj Auto up by 2.62%, Gail India up by 1.59%, Coal India up by 1.57%, Tata Power up by 1.06% and Tata Motors up by 1.00%. On the flip side, Bharti Airtel down by 2.52%, ONGC down by 1.29%, ITC down by 1.15%, ICICI Bank down by 1.12% and RIL down by 0.90% were the top losers on the BSE.

Meanwhile, terming distribution utilities as the weakest link of Indian power sector, World Bank, in its latest report, has highlighted that power distribution in India needs sweeping reforms in order to achieve the target of expanding access to electricity to all people by 2019. 

The World Bank’s report titled 'More Power to India - the challenges of electricity distribution' has stated that financial health of utilities is limiting their ability to invest for the delivery of better services and even if electricity tariff rise by 6% per year to keep up with the cost of supply, annual losses of utilities will reach Rs 1.25 lakh crore in 2017. The accumulated losses of power distribution utilities totaled at Rs 1.14 lakh crore in 2011.

World Bank emphasized that it has become imperative for India to ensure effective targeting of subsidies as half the financial support is not reaching the targeted beneficiaries. The report also recommended freeing utilities and regulators from external interference, increasing accountability and enhancing competition in the sector for better service delivery. India's annual per capita power sector consumption is at around 800 units, which is among the lowest levels in the world.

Power or electricity is very essential constituent of infrastructure affecting economic growth and welfare of the country. The Indian power sector is the fifth largest and one of the most diversified sectors in the world with an installed capacity of around 230 GW out of which coal-fired plants account for about 68% of India's installed electricity capacity. Acute fuels shortage particularly coal in the country has also become primary reason for power deficit in the country. Currently, India has been witnessing peak hour power deficit at around 3-5 %.

The CNX Nifty is currently trading at 7,566 down by 14.20 points or 0.19% after trading in a range of 7,589.25 and 7,564.15. There were 26 stocks advancing against 24 declining on the index.

The top gainers of the Nifty were Bajaj Auto up by 2.47%, Gail India up by 1.58%, Coal India up by 1.48%, Tata Power up by 1.06% and HUL up by 1.05%. On the flip side, Bharti Airtel down by 2.55%, DLF down by 1.69%, ICICI Bank down by 1.32%, BPCL down by 1.31% and ONGC down by 1.29% were the major losers on the index.

Asian equity indices were trading mixed; Straits Times up by 0.10% to 3,265.33 and Hang Seng up by 0.01% to 22,882.53. While, Nikkei down by 0.69% to 15,270.26, Jakarta Stock Index down by 0.24% to 4,850.55, Shanghai Composite down by 0.59% to 2,021.87 and Taiwan Weighted down by 0.04% to 9,242.16