Benchmarks trade cautiously in early deals on feeble global cues

Extending their previous session’s southward journey, Indian equity markets have made a cautious start and are trading slightly in the red pressurized by feeble global cues. Investors remained on sidelines ahead of the second quarter earnings with Infosys to kick-start the September quarter earnings season on Friday. However, losses remained capped as some support came in with the World Bank’s twice-a-year South Asia Economic Focus report, which has stated that Indian economy, which accounts for 80 percent of South Asia's output, is set to grow by 6.4 percent in 2015-16 as against 5.6 percent in 2014-15. It has further stated that over the next year or so economic growth should be supported by the recovering US economy that would provide a market for Indian merchandise and service exports. There have been similar voices from the other global agency IMF, which has said that India has recovered from its relative slump and its growth is expected to exceed five percent again.

On the global front, the US markets tumbled in last session with major indices losing around one and half a percent on global economic growth concerns, following the release of more disappointing German economic data and as the IMF cut its global growth forecast to 3.8 percent for 2015, from 4 percent. The Asian markets were trading lower at this point of time taking cues from the overnight selloff in the US markets and most of the indices are showing cut of over a percent in early deals.

On the sectoral front, capital goods, fast moving consumer goods and oil and gas witnessed the maximum gains in trade, while software, technology and healthcare remained the top losers on the BSE sectoral space. The broader indices too were struggling to get any traction, while the market breadth on the BSE was positive; there were 977 shares on the gaining side against 864 shares on the losing side while 72 shares remain unchanged.

The BSE Sensex opened at 26229.67; around 43 points lower as compared to its previous closing of 26271.97, and has touched a high and a low of 26334.35 and 26187.81 respectively. The BSE Sensex is currently trading at 26257.25, down by 14.72 points or 0.06%. There were 20 stocks advancing against 10 stocks declining on the index.

The overall market breadth remained in the favour of advances with 51.07% stocks advancing against 45.16% declines. The broader indices were trading mixed; the BSE Mid cap index was down by 0.07%, while Small cap index up by 0.04%.

The gaining sectoral indices on the BSE were Capital Goods up by 1.11%, FMCG up by 0.75%, Oil & Gas up by 0.59%, PSU up by 0.59% and Bankex up by 0.58% while, IT down by 2.24%, TECK down by 1.83%, Healthcare down by 1.55%, Infrastructure down by 0.12% and Metal down by 0.10% were the losing indices on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 1.65%, ONGC up by 1.23%, NTPC up by 1.17%, ITC up by 1.05% and SBI up by 1.02%. On the flip side, Infosys down by 2.93%, Dr. Reddys Lab down by 2.71%, Cipla down by 2.57%, Wipro down by 1.92% and TCS down by 1.82% were the top losers.

Meanwhile, with an aim to bring more transparency in coal blocks allocation, Coal Ministry has planned to amend the Coal Bearing Areas (Acquisition and Development) Act.

The Ministry has circulated a Cabinet note to transfer surface rights of land held by the public sector miner to the awardees. According to the proposal, the land transfer would be through a conveyance deed on terms agreed between the winner and Coal India. The move is expected to enable quick transfer of land held by Coal India to successful bidders.

Further, the proposal suggests that the mineral rights will be deemed to be with the State Government which shall grant mining lease to the successful player. The proposal also stipulates that land transfer will also include the cost incurred by Coal India, money spent on rehabilitation and resettlement and acquisition of the land.

The CNX Nifty opened at 7,828.75; around 24 points lower as compared to its previous closing of 7,852.40, and has touched a high and a low of 7,869.90 and 7,826.70 respectively.

The CNX Nifty is currently trading at 7851.30, down by 1.10 points or 0.01%. There were 32 stocks advancing against 18 stocks declining on the index.

The top gainers on Nifty were Larsen & Toubro up by 1.88%, ONGC up by 1.32%, NTPC up by 1.21%, SBI up by 1.17% and ITC up by 1.03%. On the flip side, Cipla down by 2.78%, Infosys down by 2.64%, Dr. Reddys Lab down by 2.63%, Tech Mahindra down by 2.63% and Wipro down by 1.89% were the top losers.

Asian markets trade mostly lower; Nikkei 225 tumbled by 214.01 points or 1.36% to 15,569.82, Hang Seng contracted 162.18 points or 0.69% to 23,260.34, KOSPI Index decreased by 0.73 points or 0.04% to 1,972.18, Straits Times slipped 12.23 points or 0.38% to 3,231.76, Jakarta Composite dipped 43.64 points or 0.87% to 4,989.20, FTSE Bursa Malaysia KLCI declined by 6.42 points or 0.35% to 1,827.12 and Taiwan Weighted was down by 20.14 points or 0.22% to 9,020.67.

On the flip side, Shanghai Composite was up by 6.99 points or 0.30% to 2,370.86.