Benchmarks continue weak trade; FMCG, Auto drag

Indian equity markets continued their weak trade in the late afternoon session on account of selling in frontline blue chip counters and taking cues from European counterparts. The sentiment mainly took a hit after rupee depreciated further and continued trading beyond psychological ‘63/$’ level in the wake of global turmoil in stocks and currencies. Traders were seen piling positions in Metal, PSU and Oil & Gas stocks while selling was witnessed in FMCG, Auto and Realty sector stocks. In scrip specific development, India’s troubled airline SpiceJet was trading in red as the company has grounded flights after oil companies refused to refuel any of its planes. Tata Steel was trading in green after the company resumed production from two of its four iron ore mines, cutting a shortage that had forced the company to import the raw material for the first time.

On the global front, the Asian markets were trading mostly in green while the European markets were trading on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading below the psychological 8,050 and 26,800 levels respectively. The market breadth on BSE was negative in the ratio of 957:1682 while 72 scrips remained unchanged.

The BSE Sensex is currently trading at 26767.99, down by 13.45 points or 0.05% after trading in a range of 26469.42 and 26871.91. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.31%, while Small cap index down by 0.79%.

The gaining sectoral indices on the BSE were Metal up by 1.24%, PSU up by 0.91%, Oil & Gas up by 0.80%, INFRA up by 0.70%, Bankex up by 0.62% while, FMCG down by 1.67%, Auto down by 1.26%, Realty down by 1.12%, Consumer Durables down by 0.82%, Power down by 0.54% were the losing indices on BSE.

The top gainers on the Sensex were Sesa Sterlite up by 3.99%, SBI up by 2.75%, Tata Steel up by 2.00%, ONGC up by 1.97% and Dr. Reddy’s Lab up by 1.40%. On the flip side, ITC down by 3.38%, Cipla down by 2.89%, Hero MotoCorp down by 1.91%, Tata Power down by 1.81% and Sun Pharma down by 1.69% were the top losers.

Meanwhile, showing sluggishness in domestic economy recovery, credit flow to the commercial sector has come down to 11.1 percent in October from 14.2 percent in April on account of weak demand for banking funds. During October 2013, the bank credit growth was recorded at 17 percent.

The government has stated that there has been deceleration of bank credit off-take by medium and large industries, services and priority sector in October 2014 as compared to October 2013. The corporate sector is also moving to alternative sources for their funding needs and also tapping the commercial paper market.

Indian industrial production contracted by 4.2 percent in October, mainly on account of poor show by the manufacturing sector. The manufacturing output which accounts for around 75 percent of the IIP index, contracted by 7.6 percent in October, as compared to a dip of 1.3 percent in the same month last year. Most of infrastructure projects are still stuck due to the issue of clearances and firms are burdened by debt and low cash flows. Furthermore, prevailing high interest rate scenario in domestic economy is also discouraging domestic companies to take credit.  India’s economic growth slowed down to 5.3% y-o-y to 14.39 lakh crore in Q2FY15 as against 5.7% in the previous quarter.

The CNX Nifty is currently trading at 8042.55, down by 25.05 points or 0.31% after trading in a range of 7961.35 and 8082.00. There were 18 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were Sesa Sterlite up by 3.54%, SBI up by 2.60%, NMDC up by 2.38%, Tata Steel up by 1.92% and ONGC up by 1.89%. On the flip side, ITC down by 3.36%, DLF down by 3.05%, Cipla down by 2.91%, Kotak Mahindra Bank down by 2.84% and Asian Paints down by 2.52% were the top losers.

The Asian markets were trading mostly in green; Straits Times increased 10.22 points or 0.32% to 3,225.31, FTSE Bursa Malaysia KLCI increased 15.14 points or 0.9% to 1,689.08, Jakarta Composite increased 23.16 points or 0.46% to 5,049.18, Shanghai Composite increased 39.5 points or 1.31% to 3,061.02 and Nikkei 225 increased 64.41 points or 0.38% to 16,819.73.

On the other hand, Taiwan Weighted decreased 122.55 points or 1.37% to 8,828.36, Hang Seng decreased 84.66 points or 0.37% to 22,585.84 and KOSPI Index decreased 3.97 points or 0.21% to 1,900.16.

The European markets were trading in red; Germany’s DAX decreased 88.52 points or 0.93% to 9,475.37, France’s CAC decreased 37.81 points or 0.92% to 4,055.39 and UK’s FTSE 100 decreased 55.69 points or 0.88% to 6,276.14.