Benchmarks continue lackluster trade; BSE resumes trading

Indian equity benchmarks continued their lackluster trade in the late afternoon session hovering near the neutral line with the Bombay Stock Exchange (BSE) markets reopening post 12:30 pm after trade was halted due to technical glitch. The normal trading resumed on all indices. The fourth and by far the most serious of technical glitches this year forced the country’s oldest stock exchange to shut down trading in all its segments on Thursday morning. The activity in Indian services sector, which represents around 60% of Indian GDP, witnessed a solid rate of expansion in the month of June on the back of stronger new business inflows and better economic conditions, too failed to lift the sentiments on the street. Traders were seen piling up positions in Auto, HealthCare and FMCG while selling was witnessed in Realty, Oil & Gas and Power sector stocks. In scrip specific development, Sharon Bio Medicine was trading in green after the board members of the company approved pricing of warrants at price of Rs 50 per warrant to be issued to promoter group on preferential basis. Apollo Hospitals Enterprises was trading firm after the company announced reorganization to drive next wave of growth. DLF was trading in red after the chief secretary of the Kerala government submitted a report in the state assembly pointing to large-scale violations by the builder in a project in Kochi.

On the global front, the Asian markets were trading on a mixed note, while the European markets traded on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 7,700 and 25,800 levels respectively. The market breadth on BSE was negative in the ratio of 1001:1204 while 69 scrips remained unchanged.

The BSE Sensex is currently trading at 25861.67, up by 20.46 points or 0.08% after trading in a range of 25999.08 and 25801.00. There were 14 stocks advancing against 16 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.09%, while Small cap index was down 0.02%.

The gaining sectoral indices on the BSE were Auto up by 1.00%, HealthCare up by 0.96%, FMCG up by 0.38%, IT up by 0.32% and TECK up by 0.17%. On the flip side, Realty down by 1.04%, Oil & Gas down by 0.98%, Power down 0.70%, India Infrastructure Index down 0.36% and PSU down by 0.18% were the top losing index on BSE.    

The top gainers on the Sensex were Tata Motors up by 3.54%, Sun Pharma up by 1.92%, Mahindra & Mahindra up by 1.87%, Wipro up by 1.63% and SSLT up by 1.16%. On the flip side, Hero MotoCorp down 3.02%, Bajaj Auto down by 2.11%, Hindalco Industries down 1.91%, Tata Power down by 1.38% and ONGC down by 1.22%.

Meanwhile, showing an indication of economic recovery, activity in Indian services sector, which represents around 60% of Indian GDP, witnessed a solid rate of expansion in the month of June on the back of stronger new business inflows and better economic conditions. The HSBC services Purchasing Managers’ Index (PMI), based on the survey of around 350 private service sector companies, rose to 17-month high at 54.4 in June from 50.2 in May, above the crucial 50 mark for the second consecutive month that separates growth from contraction. Output expanded in four of the six monitored categories with the fastest increase witnessed in the Post & Telecommunication and Renting Business Activities sectors. Indicating further expansion in business activity overall, the HSBC India Composite Output Index, which measures activity in both the manufacturing and services sector, increased from 50.7 in May to 53.8 in the month of June.

The HSBC survey indicated that new orders increased for the second consecutive month to 54.3 in June driven by improved demand and the pace of new work expansion was quickest since February 2013. Further, backlogs of work at service providers were accumulated at the sharpest pace in the survey history, indicating robust demand growth and delayed payment from clients. However, the survey signaled a steady inflation reading with input costs across the sector rose in the reported month on account of high prices of fuel. The rate of cost inflation was strongest in five months but below the long-run series trend. Accordingly, services firms passed increased cost burden to consumers, suggesting consumer price inflation could rise in coming months.

Employment level in services sector increased at a marginal pace with the index measuring workforce numbers registering only fractionally above the crucial 50 threshold in June. Indian services companies also maintained their positive outlook for output growth over the next 12 months on the back of supportive factors such as planned increases in marketing budgets, forecasts of stronger demand and ongoing improvements in India’s economy. Referring to Indian economy outlook, the survey noted that faster reforms due to political stability are likely to provide impetus to Indian economy.

The CNX Nifty is currently trading at 7722.40, down by 2.75 points or 0.04% after trading in a range of 7754.65 and 7708.65. There were 19 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 3.62%, Sun Pharma Industries up by 2.10%, Mahindra & Mahindra up by 1.86%, Wipro up by 1.85% and Coal India up by 1.00%. On the flip side, Hero MotoCorp down by 3.20%, Bajaj Auto down by 2.12%, Hindalco Industries down by 2.08%, Tata Power down by 1.78% and Indusind Bank down by 1.76% were the top losers.

Asian stocks closed on a mixed note, FTSE Bursa Malaysia KLCI gained 0.17%, Shanghai Composite added 0.19%, Straits Times was up 0.49% and Taiwan Weighted was up 0.44%.

On the flip side, Hang Seng lost 0.08%, Nikkei 225 dropped 0.14%, Jakarta Composite dipped 0.34% and KOSPI Index decreased by 0.21%.

The European markets were trading in green; Germany’s DAX added 0.36%, UK’s FTSE 100 was up by 0.31% while, France’s CAC 40 gained 0.39%.