Markets continue to trade in negative territory

Indian equity benchmarks were trading in red in afternoon session on account of profit-taking by funds and retail investors ahead of the Railway Budget amid weak global cues. Most of the sectoral indices were trading in negative territory with metal as the top losing indices down by around 1.47%. Selling was broad based with both mid cap and small cap indices were trading down by over 0.30%. Investors were also seen booking profit on railway sector stocks. However, losses remained capped as the gains in defensive sector stocks such as healthcare and FMCG stocks provided some support to the domestic benchmarks. Sentiments also got some support as foreign portfolio investors (FPIs) invested in Indian equities in previous session. Pharmaceutical stocks continued their upward march with most frontline stocks trading at multi-year highs on the bourses. Stock specific, ITI has soared nearly 11% to Rs 43.30 after the company reported that it has bagged two advance purchase orders from BSNL amounting to Rs 2,984 crore.

On global front, Asian equity indices were trading in red with Hang Seng down by 0.06% and Nikkei 225 down by 0.42%. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 7,700 and 26,000 levels respectively. The market breadth on BSE was negative, out of 2,816 stocks traded, 1,036 stocks advanced, while 1,691 stocks declined on the BSE.

The BSE Sensex is currently trading at 26,038.47 down by 61.61 points or 0.24% after trading in a range of 26,190.44 and 25,982.97. There were 10 stocks advancing against 20 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.34%, while Small cap index down by 0.68%.

The gaining sectoral indices on the BSE were Healthcare up by 1.03%, FMCG up by 0.16% and Capital Goods up by 0.01%. On the flip side, Metal down by 1.47%, Realty down by 1.19%, Auto down by 0.88%, Power down by 0.84% and Oil and Gas down by 0.81% were the losing indices on BSE.    

The top gainers on the Sensex were HDFC down by 2.31%, Sun Pharma up by 2.18%, Cipla up by 1.74%, HUL up by 0.64% and Dr Reddy’s Lab up by 0.34%. On the flip side, SSLT down by 3.07%, M&M down by 1.78%, ONGC down by 1.41%, Maruti Suzuki down by 1.06% and  NTPC down by 1.05% were the top losers on the BSE.

Meanwhile, the government has proposed to hike foreign direct investment (FDI) limit in insurance sector to 49 percent from the current 26 percent. The Department of Financial Services has amended the Insurance Laws Bill, 2008 with a rider that voting right of overseas partner will remain capped at 26 percent.

Further, the department has cleared that the chief executive officer (CEO) of the insurance company will be appointed by Indian shareholders subject to approval of a competent authority and a majority of the company's directors will have to be Indians. The department’s proposal sought increase in foreign investment in both general as well as life insurance segments of the insurance sector. Earlier proposal was that the higher FDI limit would be allowed only for health insurers. The official amendment will incorporate suitable safeguards on foreign equity investment in the insurance sector while enhancing the overall cap to 49 percent.

An increase in FDI limit to 49 percent would bring in around $1 billion (around Rs 6,000 crore) of foreign investment in Indian insurance sector. Insurance in India is mainly of two types namely ‘life insurance’ and ‘general insurance’. At present, there are fifty-two insurance companies operating in India of which twenty-four are in the life insurance business. During 2008-09 and 2013-14, insurance penetration has fallen from 4.6 percent to 3.9 percent, reflecting need to develop the insurance sector.

The CNX Nifty is currently trading at 7,759.60 down by 27.55 points or 0.35% after trading in a range of 7,808.85 and 7,744.95. There were 14 stocks advancing against 36 declining on the index.

The top gainers of the Nifty were HDFC up by 2.09%, Sun Pharma up by 1.87%, Kotak Bank up by 1.83%, Cipla up by 1.66% and Lupin up by 1.36%. On the flip side, SSLT down by 3.28%, Power Grid down by 2.77%, Ultratech Cement down by 2.30%, HCL Tech down by 1.93% and Tech Mahindra down by 1.93% were the major losers on the index.

Most of the Asian equity indices were trading in red; Hang Seng down by 0.06% to 23,527.16, Nikkei down by 0.42% to 15,314.41 and Straits Times down by 0.20% to 3,284.91. While,  Shanghai Composite up by 0.13% to 2,060.61, Jakarta Stock Index up by 0.86% to 5,031.04 and Taiwan Weighted up by 0.11% to 9,530.20