Benchmarks extend looses; IT, TECK drag

Indian equity markets extend losses and continue to trade weak in the late afternoon session on account of selling in frontline blue chip counters taking cues from European counterparts. Rating agency Moody’s Investor Services Inc. report that India’s sovereign bond rating of ‘Baa3’ could improve if fiscal and inflation metrics were to strengthen beyond the rater’s expectations, accompanied by a sustained acceleration in infrastructure investment, failed to add any upside on the street. Moody’s, however, noted that the political climate may continue to hinder significant reforms. Traders were seen piling positions in FMCG sector while selling was witnessed in IT, TECK and Capital Goods sector stocks. In scrip specific development, SpiceJet was trading under pressure on negative reports including fund drought and large-scale flight cancellations. Infosys was trading under pressure on report that four of its founders have sold 3.2 crore shares.

On the global front, the Asian markets were trading mostly in red while the European markets were trading on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading below the psychological 8,500 and 28,200 levels respectively. The market breadth on BSE was negative in the ratio of 1065:1738 while 102 scrips remained unchanged.

The BSE Sensex is currently trading at 28193.43, down by 264.67 points or 0.93% after trading in a range of 28129.30 and 28494.85. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.84%, while Small cap index down by 0.80%.

The gaining sectoral indices on the BSE were FMCG up by 0.63% while, IT down by 3.39%, TECK down by 2.68%, Capital Goods down by 1.53%, Realty down by 1.47%, Infra down by 1.10% were the losing indices on BSE.

The top gainers on the Sensex were Coal India up by 1.75%, ITC up by 1.44%, Sun Pharma up by 1.10%, Bharti Airtel up by 1.01% and ONGC up by 0.94%. On the flip side, Infosys down by 5.16%, Sesa Sterlite down by 3.17%, TCS down by 2.73%, Hindalco down by 2.48% and Mahindra & Mahindra down by 2.28% were the top losers.

Meanwhile, with an aim to contain the fiscal target at 4.1% of GDP for current fiscal, Finance Minister Arun Jaitley has asserted that the government will come out with more measures  to rationalise subsidies. Finance Minister stressed that a series of meeting with the Expenditure Management Commission (EMC) has been taking place and the Commission is effectively working on some very valuable suggestions with regard to rationalisation of subsidies. 

Highlighting the government’s latest decisions, the minister added latest decision to link the diesel prices with market price and direct cash subsidy on pilot basis to LPG customers in select cities will help in reducing the subsidy burden of the government. Furthermore, the Centre had set up a Commission under former RBI Governor Bimal Jalan to suggest steps to lessen subsidy and help the government in effectively bringing down the fiscal deficit. On revenue collection front, the minister expressed hope that the government will able to achieve the direct tax collection target. To garner more funds, the government has initiated its disinvestment programme with latest SAIL's stake sale. It has set a target of Rs 43,425 crore through selling stakes in various PSU firms during the current fiscal.

The government’s fiscal deficit for the first seven months of this financial year recorded at Rs 4.76 lakh crore, a staggering 89.6% of the target of Rs 5.31 lakh crore for the entire financial year. The fiscal deficit for the April-October period this year was the highest since at least 1998-99 and for the corresponding period of 2013-14, the fiscal deficit was stood at 84.4% of the FY14 target.

The CNX Nifty is currently trading at 8455.80, down by 82.50 points or 0.97% after trading in a range of 8437.15 and 8546.35. There were 14 stocks advancing against 36 stocks declining on the index.

The top gainers on Nifty were Coal India up by 1.75% and ITC up by 1.49% and ONGC up by 1.12% and Asian Paints up by 1.06% and Sun Pharma up by 1.06%. On the flip side, Infosys down by 5.13%, Sesa Sterlite down by 3.33%, HCL Tech. down by 3.14%, TCS down by 2.94% and Jindal Steel & Power down by 2.71% were the top losers.

The Asian markets were trading mostly in red; Jakarta Composite decreased 43.28 points or 0.83% to 5,144.72, Taiwan Weighted decreased 19.28 points or 0.21% to 9,187.29, Straits Times decreased 14.99 points or 0.45% to 3,309.40, KOSPI Index decreased 7.67 points or 0.39% to 1,978.95 and FTSE Bursa Malaysia KLCI decreased 5.6 points or 0.32% to 1,743.77.

On the other hand, Nikkei 225 increased 15.19 points or 0.08% to 17,935.64, Hang Seng increased 45.03 points or 0.19% to 24,047.67 and Shanghai Composite increased 82.61 points or 2.81% to 3,020.26.

The European markets were trading in red; UK’s FTSE 100 decreased 24.82 points or 0.37% to 6,718.02, Germany’s DAX decreased 24.46 points or 0.24% to 10,062.66 and France’s CAC decreased 18.88 points or 0.43% to 4,400.60.