Markets slip into negative territory in afternoon session

Indian equities pared all early gains and slipped into the negative territory, hovering near the lowest point of the day in the afternoon session due to the heavy selling witnessed in power, infra and auto stocks. Profit booking emerging at higher levels dragged the market down and power and infra were the top losing indices trading down by over 0.60% on the BSE. Investors were also seen selling frontline blue chip stocks, moreover weak Asian cues also weighed on the sentiments. However, IT index outperformed all other sector indices amid reports that IT major Wipro and tech Mahindra received big project orders. Capital goods stocks were also trading in green as industry major L&T secured a turnkey order worth Rs 5,100 crore for setting up a 1320 MW supercritical thermal power plant project from the state utility MP Power Generating Company Limited (MPPGCL).

JP Associates has extended losses for the second consecutive day and has dipped by over 3% at Rs 36.50 after Jaypee Infra Ventures sold over 13 million shares. On the other hand, Union Bank of India has gained nearly 2% to Rs 215 after the company plans to raise Rs 1,386 crore through qualified institutional placement (QIP) this financial year. 

On global front, Asian markets were trading mixed, Nikkei 225 up 0.02% to 15,679.36, and Hang Seng down 0.35%. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 8,100 and 27,000 levels respectively. The market breadth on BSE was negative, out of 2,590 stocks traded, 1,332 stocks advanced, while 1,166 stocks declined on the BSE.

The BSE Sensex is currently trading at 26987.28, down by 98.65 points or 0.36% after trading in a range of 26958.51 and 27178.80. There were 9 stocks advancing against 20 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.02%, while Small cap index up by 0.36%.

The gaining sectoral indices on the BSE were IT up by 0.20%, Oil & Gas up by 0.15%, Capital Goods up by 0.13%, Realty up by 0.12% and Metal up by 0.02%. On the flip side, Power down by 1.01%, INFRA down by 0.64%, Auto down by 0.52%, Bankex down by 0.47% and FMCG down by 0.34% were the losing indices on BSE.

The top gainers on the Sensex were ONGC up by 0.94%, GAIL India up by 0.78%, SBI up by 0.66%, Larsen & Toubro up by 0.63% and Bajaj Auto up by 0.60%. On the flip side, Coal India down by 2.20%, BHEL down by 2.14%, HDFC down by 1.81%, Hero MotoCorp down by 1.68% and Tata Power down by 1.40% were the top losers.

Meanwhile, signalling stronger growth of output across global emerging markets, services and manufacturing activities across emerging markets expanded at a stronger pace in August. The HSBC Composite Emerging Markets Index, based on the survey of around 8,000 firms in 19 countries, rose to a 17 month high of 52.5 in August, up from 51.7 in July. The pace of economic growth in emerging markets continued to revive from the stagnation seen earlier in the year and the fastest pace of expansion in the month of August was buoyed by strongest growth in China's services economy. However, India registered low growth in manufacturing as well as services sectors in comparison to China.

Among the largest emerging markets, China posted the fastest growth since March 2013 with HSBC Composite Output Index increasing to 52.8 in August from 51.6 in the previous month. Meanwhile, output in Russia and India rose at weak rates, while a marginal contraction was signaled for the fifth month running in Brazil. During August, the HSBC composite index, which maps both manufacturing and services, for India stood at 51.6, for Brazil (49.6) and Russia (51.1). An index value above 50 mark indicates expansion. In emerging markets, service sector output rose at a stronger rate in August whereas manufacturing output rose at same rate recorded in the previous month July.

The HSBC survey further indicated that new business growth regained momentum and grew at fastest pace in nearly one and half years. Backlogs of work continued to decline marginally, signalling spare capacity and employment was broadly stable, in line with the underlying trend witnessing from past one and half years. On inflation front, the survey highlighted that input price inflation reached a three-month low in August on account of weaker rise in manufacturing input prices. Regarding the business expectation, the survey noted that the outlook for global emerging markets continued to deteriorate in August. The HSBC Emerging Markets Future Output Index tracks firms’ expectations for activity in 12 months’ time, fell in August to the second-lowest level since the series started in April 2012, almost matching May’s record low.
 
The CNX Nifty is currently trading at 8069.90, down by 26.05 points or 0.32% after trading in a range of 8061.25 and 8122.70. There were 15 stocks advancing against 35 stocks declining on the index.

The top gainers on Nifty were NMDC up by 3.20%, DLF up by 2.66%, Asian Paints up by 1.68%, Jindal Steel & Power up by 1.29% and ONGC up by 1.10%. On the flip side, United Spirits down by 3.37%, Coal India down by 2.64%, BHEL down by 2.31%, HDFC down by 1.84% and Hero MotoCorp down by 1.75% were the top losers.

Asian markets were trading mixed, Nikkei 225 up by 3.18 points or 0.02% to 15,679.36, Jakarta Composite up by 6.08 points or 0.12% to 5,211.40 and Shanghai Composite up by 8.92 points or 0.39% to 2,315.79. While, Hang Seng down 88.81 points or 0.35% to 25,209.11, Taiwan Weighted down 20.95 points or 0.22% to 9,407.94, Straits Times down 19.12 points or 0.57% to 3,327.22, KOSPI Index down 6.85 points or 0.33% to 2,049.41.