Benchmarks trade lower on penultimate day of F&O series expiry

Indian equity benchmarks are trading lower in early deals as investors opted to remain on sidelines on penultimate day of F&O series expiry. Traders also reacted negatively on L&T's first quarter disappointing numbers. Although the biggest engineering and construction firm of the country reported more than double Net Profit for the June quarter, profitability of core businesses like engineering, power, material handling and heavy engineering showed pressure on margins. However, losses remained capped as some solace came in with National Council of Applied Economic Research (NCAER) report saying that India’s GDP will expand at 5.2-5.7 percent this fiscal, with manufacturing sector showing signs of nascent recovery.

On the global front, the US markets ended lower in last session after the US President Barack Obama announced of slapping sanctions on Russian energy, defense and financial sectors on accusations that Moscow continues to support separatists in the Ukraine. However, Asian markets were trading mostly in the green at this point of time ahead of a rate announcement from the US Federal Reserve, though some of the indices are in red on few weak earnings in the region.

Back home, on the sectoral front, oil and gas, infrastructure and technology witnessed the maximum gains in trade, while capital goods, metal and realty remained the top losers on the BSE sectoral space. The broader indices too were reeling under pressure, while the market breadth on the BSE was negative; there were 806 shares on the gaining side against 898 shares on the losing side while 74 shares remain unchanged.

The BSE Sensex opened at 26005.14; around 14 point higher compared to its previous closing of 25991.23, and has touched a high and a low of 26022.62 and 25929.83 respectively. The index is currently trading at 25956.36, down by 34.87 points or 0.13%. There were 14 stocks advancing against 16 declines on the index.

The overall market breadth has made a negative start with 45.33% stocks advancing against 50.51% declines. The broader indices were trading in the red; the BSE Mid cap index was up by 0.35%, while Small cap index was up by 0.28%. 

The top gaining sectoral indices on the BSE were Oil and Gas up by 0.72%, Infrastructure up by 0.70%, TECk up by 0.62%, Consumer Durables up by 0.56% and IT up by 0.28%, while Capital Goods down by 4.61%, Metal down by 0.89%, Realty down by 0.59%, Healthcare down by 0.17% and Power down by 0.08%, were the major losers on the sectoral index.

The top gainers on the Sensex were Bharti Airtel up by 4.85%, Gail India up by 1.81%, Hero MotoCorp up by 1.78%, M&M up by 1.44% and ONGC up by 1.19%. On the flip side, L&T was down by 6.81%, SSLT was down by 2.79%, HUL was down by 1.44%, Tata Power was down by 1.24% and Tata Steel was down by 1.14% were the top losers on the Sensex.

Meanwhile, exports have remained a core feature of India’s textile industry. Textiles Ministry has set textile export target at $45 billion for the current financial year. In FY14 India exported textiles worth $40 billion. India’s textile industry exports account for around 10 percent of the country’s export earnings.

In order to support the industry’s exports, the government has taken various measures such as Focus Market Scheme, Market Linked, Focus Product Scheme and Duty Drawback Scheme. Domestic textile players are also exempted on import duty on the import of capital Goods under EPCG and raw material under Advance Authorisation Scheme. Further, interest subvention was enhanced to 3 percent from 2 percent under Interest Subvention Scheme. With the government various initiatives, India’s global market share in textile exports increased to 5.2 percent in 2013 from 3 percent in 2002.

Textile industry contributes around 4 percent to the gross domestic product (GDP) and nearly 14 percent to industrial production besides providing direct employment to over 45 million people. The present market size of the industry stands at around $90 billion, which is expected to touch $220 billion mark by 2020.

The CNX Nifty opened at 7,746.20; about 2 point lower as compared to its previous closing of 7,748.70, and has touched a high and a low of 7,756.85 and 7,730.10 respectively. The index is currently trading at 7,734.40, down by 14.30 points or 0.18%. There were 21 stocks advancing against 29 declines on the index.

The top gainers of the Nifty were Bharti Airtel up by 4.99%, Gail India up by 1.90%, Hero MotoCorp up by 1.64%, Kotak Bank up by 1.43% and ONGC up by 1.25%. On the flip side, L&T down by 6.87%, SSLT down by 2.76%, Tata Power down by 1.43%, HUL down by 1.37% and Ultratech Cement down by 1.33% were the major losers on the index.

Asian markets were trading mostly in the green; Nikkei 225 gained 33.50 points or 0.21% to 15,651.57, Hang Seng strengthened by 185.16 points or 0.75% to 24,825.69, KOSPI Index increased 24.08 points or 1.17% to 2,086.05, FTSE Bursa Malaysia KLCI spurted by 3.46 points or 0.18% to 1,880.80 and Taiwan Weighted was up by 29.42 points or 0.31% to 9,421.30.

On the flip side, Straits Times dipped 5.08 points or 0.15% to 3,351.00, Jakarta Composite dropped by 9.84 points or 0.19% to 5,088.80 and Shanghai Composite was down by 2.80 points or 0.13% to 2,180.39.