Markets extend losses; trade near intra-day low level

Indian equity benchmarks extended their early losses and were trading near intra-day low level in afternoon session on sustained foreign fund outflows, tracking weak global cues amid reducing crude prices. Weak trend on Asian bourses tracking overnight losses on US markets dampened trading sentiment, moreover investors also remained concerned ahead of the release of key macro-economic indicators such as Indian Industrial Production (IIP) and CPI inflation on tomorrow. Most of the sectoral indices on BSE were trading in negative territory with realty as top losing index trading down by over 1.60%. Sell-off also continued in the broader markets with both the mid and small cap indices trading down by over 0.70%. Sector wise, shares of sugar companies have rallied by up to 13% on the bourses after the government fixes a price of Rs 48.50-49.50 per litre for procurement of ethanol for blending with petrol. Among blue chip stocks, BHEL was top gainer up by around 1.80%, while GAIL was top loser trading down by around 2.23%.

Havells India has slipped around 7% to Rs 289 after the company’s management has cut its FY15 guidance. On the other hand, shares of Sintex Industries were up nearly 2% at Rs 101 after the company said it plans to invest Rs 5,500 crore in a greenfield textiles plant including spinning and knitting at Pipavav.

On global front, most of the Asian markets were trading in red with Hang Seng down 0.93% and Nikkei 225 down 0.87%. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 8,300 and 28,000 levels respectively. The market breadth on BSE was negative, out of 2,445 stocks traded, 830 stocks advanced, while 1,539 stocks declined on the BSE.

The BSE Sensex is currently trading at 27577.70, down by 253.40 points or 0.91% after trading in a range of 27553.90 and 27796.34. There were 6 stocks advancing against 24 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.78%, while Small cap index down by 0.92%.

The losing sectoral indices on the BSE were Realty down by 1.64%, Oil & Gas down by 1.60%, Capital Goods down by 1.26%, Bankex down by 1.19% and PSU down by 1.19%. The were no gaining indices on BSE.

The top gainers on the Sensex were BHEL up by 1.80%, Mahindra & Mahindra up by 0.70%, Bajaj Auto up by 0.30%, Hindustan Unilever up by 0.23% and TCS up by 0.16%. On the flip side, GAIL India down by 2.23%, ICICI Bank down by 2.01%, Larsen & Toubro down by 1.91%, Bharti Airtel down by 1.84% and Infosys down by 1.72% were the top losers.

Meanwhile, ahead of the meeting with state finance ministers to iron out contentious issues over GST implementation, Finance Minister Arun Jaitley has asserted that the government will soon release Rs 11,000 crore towards Central Sales Tax (CST) compensation, as part of consensus building for Goods and Services Tax (GST) rollout.

The Minister stressed that despite the challenging revenue condition, the government will release about Rs 11,000 crore, which is one-third this year, as a part payment of CST compensation to the states and balance amount will start being paid from the next financial year. The GST roll out has missed several deadlines because of lack of consensus among Centre and states over certain crucial issues like CST compensation. The states still wait for Rs 13,000 crore CST compensation arrears pending till 2010 and have also sought a five-year compensation mechanism from the Centre and demanded the same to be included in the GST Constitutional Amendment Bill. States have also been demanding that petroleum, alcohol and tobacco should be kept out of the purview of the GST.

The proposed GST is one of the biggest taxation reforms in India and will replace existing state and federal levies such as excise duty, service tax and value-added tax (VAT) and will integrate State economies and boost overall growth. Under GST, the taxation burden will be divided equitably between manufacturing and services, through a lower tax rate by increasing the tax base and minimizing exemptions. The industry is awaiting its introduction, as GST would boost revenues and aid economic growth.

The CNX Nifty is currently trading at 8281.80, down by 73.85 points or 0.88% after trading in a range of 8276.15 and 8348.30. There were 10 stocks advancing against 40 stocks declining on the index.

The top gainers on Nifty were BHEL up by 1.84%, Tech Mahindra up by 1.03%,  Mahindra & Mahindra up by 0.60%, Ultratech Cement up by 0.53% and Lupin up by 0.43%. On the flip side, Jindal Steel & Power down by 2.69%, GAIL India down by 2.58%, Cairn India down by 2.53%, ICICI Bank down by 2.03% and Larsen & Toubro down by 1.91% were the top losers.

Asian markets were trading in red, Hang Seng down 219.93 points or 0.93% to 23,304.59, Nikkei 225 down 151.5 points or 0.87% to 17,261.08, KOSPI Index down 28.97 points or 1.49% to 1,916.59, Taiwan Weighted down 19.09 points or 0.21% to 9,013.07, Jakarta Composite down 13.3 points or 0.26% to 5,152.11, FTSE Bursa Malaysia KLCI down 8.52 points or 0.48% to 1,757.00, Shanghai Composite down 7.14 points or 0.24% to 2,932.87 and Straits Times down 6.13 points or 0.18% to 3,319.68.