Markets slip to day’s low on incremental selling pressure; Nifty holds above 8300 level

Local barometer gauges after slipping into negative territory in late morning deals, continued trading weak on incremental selling pressure. After making a good start on hopes of faster economic growth on Sunday’s union cabinet expansion, markets failed to sustain the early euphoria and soon slipped into negative territory and since then the trend has subdued. At day’s low, both Sensex and Nifty were trading below psychologically crucial 27, 800 and 8,350 levels respectively, with losses of around three tenths of a percent. However, broader indices managing to hold their heads above water were trading with gains in the range of 0.05%-0.13%.

Sentiments were spooked by RBI’s deputy governor’s hawkish statements, HR Khan, who pouring cold water on hopes of rate cut in upcoming monetary policy, highlighted that recent decline in inflation did not mean the decline was permanent. He also emphasized that though decline in crude oil prices and other commodities were beneficial to Indian economy, but policy makers just could not jump their guns until they were convinced the trend was firmly established. Additionally, disappointing earnings of market bellwether, L&T also weighed on the sentiment. L&T stocks tanked over 3% after the company reported 20.5% jump in standalone net profit at Rs 1,042 crore during quarter ended September 2014 as compared to net profit of Rs 865 crore in the corresponding quarter last fiscal.

On the global front, China and Hong Kong led gains in Asian stock markets Monday following the approval of a cross-border trading link that will give foreigners greater access to Chinese shares. Robust U.S. jobs figures and China trade data also were buoying buying sentiments.

Closer home, almost all the sectoral indices on BSE succumbed to selling pressure, except for stocks from FMCG, Healthcare and Consumer Durable counters. On the flip side, much of the pressure was witnessed by stocks from Capital Goods, Metal and Auto counters. Meanwhile, Railway stocks were trading higher after the appointment of new minister on hopes for reforms and investment into sector. The overall market breadth on BSE was in the favour of declines which thumped advances in the ratio of 1112:871; while 23 shares remained unchanged.

The BSE Sensex is currently trading at 27771.61, down by 97.02 points or 0.35% after trading in a range of 27770.00 and 28027.96. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.13%, while Small cap index up by 0.05%.

The gaining sectoral indices on the BSE were FMCG up by 2.19% and Consumer Durables up by 0.33% while; Capital Goods down by 1.34%, Metal down by 0.81%, Auto down by 0.80%, Oil & Gas down by 0.76% and Bankex down by 0.76% were the losing indices on BSE.

The top gainers on the Sensex were ITC up by 3.33%, Sun Pharma Industries up by 2.53%, BHEL up by 1.43%, Coal India up by 1.16% and Hero MotoCorp up by 0.73%. On the flip side, ONGC down by 2.80%, Larsen & Toubro down by 2.62%, Tata Motors down by 2.48%, Hindalco down by 2.37% and Tata Steel down by 1.62% were the top losers.

Meanwhile, as Prime Minister expanded Cabinet to speed up economic reforms, the Confederation of Indian Industry (CII) has stated that the ministry-expansion will help improve the focus on economic recovery. The CII president Ajay Shriram has asserted that at a time when the economy is recovering, it is important to fast-track policies to strengthen the growth and the latest government move of induction of new ministers will streamline governance and bring in new ideas for the economic reforms process.

The CII President further stated that business sentiment in the country is picking up since the new government took over. Further, ministerial expansion will support faster decision-making, efficient administration and faster clearances to ensure new investments.

Indian Prime Minister Narendra Modi on November 9 added 21 new ministers to speed up economic reforms. The strength of the Union Council of Ministers goes up from 45 to 66 of which, 27 including the Prime Minister are of Cabinet rank, 13 Ministers of State with Independent Charge and 26 Ministers of State.

Indian economic had been struggling with slowdown over the past two fiscal and its growth stayed below 5% for the second fiscal in a row at 4.7% during FY14. The factors like high interest rate and stubborn inflation, low investments and slow execution of infrastructure projects have impacted country’s economy growth.  However, the economy has shown signs of nascent recovery and expanded at its fastest pace in more than two years by 5.7% during Q1FY15 as compared to 4.7% growth recorded in same quarter last year.

The CNX Nifty is currently trading at 8306.85, down by 30.15 points or 0.36% after trading in a range of 8306.25 and 8383.05. There were 17 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were ITC up by 3.47%, Sun Pharma Inds. up by 2.29%, Bank Of Baroda up by 1.98%, BHEL up by 1.49% and Coal India up by 1.25%. On the flip side, Jindal Steel & Power down by 3.22%, ONGC down by 2.87%, Larsen & Toubro down by 2.81%, Hindalco down by 2.66% and Tata Motors down by 2.44% were the top losers.

Asian markets were trading mostly into green; FTSE Bursa Malaysia KLCI were up by 4.91 points or 0.27% to 1,829.10; KOSPI Index gained 18.36 points or 0.95% to 1,958.23; Straits Times rose by 22.43 points or 0.68% to 3,308.82; Shanghai Composite surged by 48.83 points or 2.02% to 2,467.01; Taiwan Weighted rallied by 137.36 points or 1.54% to 9,049.98; Hang Seng added 426.8 points or 1.81% to 23,977.04. On the flip side, Nikkei 225 was down by 99.85 points or 0.59% to 16,780.53 and Jakarta Composite was down by 5.62 points or 0.11% to 4,981.81.