Benchmarks slip into red after a positive start

Indian equity benchmarks have slipped into red terrain after a positive start on Monday as investors remained cautious with Reserve Bank of India Deputy Governor H.R. Khan stating that India's inflation has a 'long way' to go before it eases because of high input costs, while the reasons for elevated food price inflation remain 'structural'. However, losses remained capped as some support came in by the cabinet expansion exercise by Modi government and strong FII buying. Foreign institutional investors were net buyers in Indian equities worth Rs 2,537.13 crore on Friday, as per provisional stock exchange data.

On the global front, the US markets made a mixed closing in last session, as the monthly jobs report showed that though the unemployment rate slipped to a six-year low of 5.8%, the new jobs generation remained lower than expected. The Asian markets were trading mostly in the green at this point of time led by the Hong Kong markets after regulators announced the long awaited stock link with Shanghai will commence in a week. However, the Japanese market was trading lower as the yen has strengthened against dollar.

Back home, on the sectoral front, fast moving consumer durables, healthcare and consumer durables witnessed the maximum gain in trade, while capital goods, oil and gas and software remained the top losers on the BSE sectoral space. The broader indices, however, were outperforming benchmarks, while the market breadth on the BSE was positive; there were 1158 shares on the gaining side against 875 shares on the losing side while 63 shares remain unchanged.

The BSE Sensex opened at 27919.45; around 51 points higher as compared to its previous closing of 27868.63, and has touched a high and a low of 28027.96 and 27842.50 respectively. The BSE Sensex is currently trading at 27837.20, down by 31.43 points or 0.11%. There were 12 stocks advancing against 17 stocks declining on the index.

The overall market breadth remained in the favour of advances with 55.25% stocks advancing against 41.75% declines. The broader indices were trading in green; the BSE Mid cap index was up by 0.05%, while Small cap index up by 0.09%.

The gaining sectoral indices on the BSE were FMCG up by 1.64%, Healthcare up by 0.77%, Consumer Durables up by 0.30% and Power up by 0.06%, while Capital Goods down by 0.77%, Oil & Gas down by 0.51%, IT down by 0.50%, Bankex down by 0.45% and TECK down by 0.38% were the losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 3.68%, ITC up by 2.40%, Coal India up by 1.83%, BHEL up by 1.65% and Hindustan Unilever up by 0.74%. On the flip side, ONGC down by 1.70%, Larsen & Toubro down by 1.61%, Hindalco down by 1.60%, Tata Steel down by 1.46% and Cipla down by 1.34% were the top losers.

Meanwhile, Assuring a transparent and rule-based policy environment, Finance Minister Arun Jaitley promised reforms in labour, land acquisition and insurance laws to make regulations in India more business-friendly. Terming reforms as a long journey, Finance Minister added that the government is of the view of consistently pursuing the reforms agenda to boost the economic growth rather than taking one or two big bang steps.

By adding further, Arun Jaitley said that the government has introduced some labour reforms in Parliament which will be discussed in the upcoming winter session. The government is looking at changing some illogical provisions of land acquisition laws that have made it virtually impossible for companies to acquire land for industrial projects. On insurance sector, Jaitley expressed hope that the long-pending Insurance Amendment Bill, that seeks to raise FDI in the sector from existing 26 percent to 49 percent, will get Parliament nod in the upcoming Winter Session.

Finance Minister also stressed that the government may privatize some loss making public sector units (PSUs). India has 79 loss making PSUs, of which 49 are sick enterprises. On ambitious divestment programme, Jaitley said the government would push ahead with divestment of its stake in state-owned firms but will retain majority stake in such companies.

The CNX Nifty opened at 8,337.80; around 1 point higher as compared to its previous closing of 8,337.00, and has touched a high and a low of 8,383.05 and 8,325.10 respectively.

The CNX Nifty is currently trading at 8331.75, down by 5.25 points or 0.06%. There were 21 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Sun Pharma up by 3.25%, ITC up by 2.43%, Bank of Baroda up by 2.18%, BHEL up by 1.81% and Coal India up by 1.78%. On the flip side, Jindal Steel & Power down by 2.63%, Hindalco down by 1.73%, Larsen & Toubro down by 1.63%, ONGC down by 1.62% and Cipla down by 1.42% were the top losers.

Asian markets were trading mostly in the green; FTSE Bursa Malaysia KLCI rose 5.7 points or 0.31% to 1,829.89, KOSPI Index surged 19.42 points or 1% to 1,959.29, Straits Times gained 19.77 points or 0.6% to 3,306.16, Shanghai Composite soared 28.44 points or 1.18% to 2,446.62, Taiwan Weighted increased 126.79 points or 1.42% to 9,039.41 and Hang Seng was up by 389.5 points or 1.65% to 23,939.74. On the flip side, Nikkei 225 decreased 117.36 points or 0.7% to 16,763.02 and Jakarta Composite was down by 1.66 points or 0.03% to 4,985.77