Benchmarks continue to trade in red in late morning session

After making a negative start, Indian equity benchmarks were trading in a small range, with the Sensex losing over 90 points and Nifty falling below the 8100 level, as funds and retail investors engaged in reducing positions amid a weak trend on other Asian bourses. Besides, some traders appear to be cautious ahead of the expiration of September series F&O contracts on September 25, 2014. Sentiment on the street weakened on report that overseas investors sold shares worth a net Rs 65.30 crore on September 19, 2014. However, losses remained capped as the data of Department of Industrial Policy and Promotion has stated that foreign direct investment in the services sector rose marginally to $1.03 billion during the April-July period of the ongoing fiscal, compared to $1.02 billion during the same period of the previous fiscal, 2013-14.

On the sectoral front, Stocks from Consumer Durables, Auto and Oil & Gas counters were supporting the markets’ uptrend, while those from Metal, IT and Teck counters were adding to the underlying cautious undertone. In scrip specific development, shares of Bharti Infratel have declined on the report that private equity fund Kohlberg Kravis Roberts and Co (KKR) is planning to sale its entire stake in the company. Besides, Hotel Leela Venture has dipped nearly 7% in early morning deals on reports that the company has not been able to pay Rs 22.50 crore as the first installment for servicing a debt to state-owned life insurer LIC and is seeking more time for repayment.

On global front, Asian shares were down as investors turned cautious ahead of key economic data from China. China’s flash manufacturing Purchasing Managers’ Index (PMI) data is due for release on September 25, 2014. Meanwhile, US stocks ended mixed on Friday as gains in Alibaba following a strong debut were overshadowed by losses in tech shares such as Oracle and Yahoo.

Back home, Indian rupee depreciated by four paise to 60.85 against the US dollar in early trade due to increased demand for the American currency from importers amid a weak opening in the domestic equity market. The market breadth on BSE was positive, out of 2445 stocks traded, 1336 stocks advanced, while 1022 stocks declined on the BSE.

The BSE Sensex is currently trading at 26993.44 down by 96.98 points or 0.36% after trading in a range of 27010.22 and 26918.93. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.17%, while Small cap index was up by 0.47%.

The gaining sectoral indices on the BSE were Consumer Durables up by 1.63%, Auto up by 0.38%, Oil & Gas up by 0.28%, FMCG up by 0.19% and PSU up by 0.16%, while Metal down by 1.55%, IT down by 1.02%, TECK down by 0.93%, Infrastructure down by 0.73% and Power down by 0.48% were the losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 1.54%, ONGC up by 1.46%, Hero MotoCorp up by 1.28%, ITC up by 0.60% and Coal India up by 0.25%. On the flip side, Cipla down by 2.10%, Sesa Sterlite down by 2.05%, Tata Steel down by 1.99%, Hindalco down by 1.77% and Infosys down by 1.74% were the top losers.

Meanwhile, the Department of Industrial Policy and Promotion in its latest release has reported that Foreign direct investment (FDI) in Indian services sector, which contributes over 60 percent of the GDP and includes banking, insurance, outsourcing, R&D, courier and technology testing,  rose marginally to $1.03 billion during the April-July period of the ongoing fiscal, compared to $1.02 billion during the first four months of the previous fiscal, 2013-14.

Although, the overall FDI during April-July this fiscal has jumped by 52 percent to $ 10.73 billion, the FDI in the services sector had fallen to $2.2 billion from $ 4.83 billion in 2012-13. The government is taking steps to boost inflows into the sector and has decided to raise FDI limit to 49 percent in the insurance sector from the current level of 26 percent, as the decline in foreign investments could affect the country's balance of payments and the rupee, also as India needs around $1 trillion over five years (2012-17) to overhaul its infrastructure sector.

The other sectors which received high foreign investment during the first four months of this financial year include telecommunication, construction, computer software and hardware and power. The FDI flows into India more than doubled to $ 3.5 billion in July, as compared to $1.65 billion in the same month last year. In this fiscal, during April-July period the foreign inflows grew to $10.73 billion as compared to $7.05 billion in the same period last year.

The CNX Nifty is currently trading at 8,083.75 down by 37.70 points or 0.46% after trading in a range of 8,088.50 and 8,064.80. There were 12 stocks advancing against 38 declining on the index.

The top gainers on Nifty were ONGC up by 1.72%, Tata Motors up by 1.67%, Hero MotoCorp up by 1.18%, PNB up by 0.87% and BPCL up by 0.78%. On the flip side, Asian Paints down by 2.67%, Sesa Sterlite down by 2.18%, Cipla down by 2.09%, Dr. Reddys Lab down by 1.99% and Kotak Mahindra Bank down by 1.97% were the top losers.

Asian markets were trading in the red; Nikkei 225 dropped 0.79%, Hang Seng declined by 1.33%, KOSPI Index tumbled by 0.87%, Straits Times dipped 0.17%, Jakarta Composite contracted by 0.03%, Shanghai Composite decreased by 1.67%, FTSE Bursa Malaysia KLCI slipped 0.10% and Taiwan Weighted was down by 1.17%.