Benchmarks enlarge losses; Nifty slips below 8700 mark

Indian bourses adding losses, continued to trade in red in the late morning session, with the Sensex losing over 90 points and Nifty falling below the 8700 level, weighed down by global worries and some disappointing earnings announcement. Among broader markets, BSE Midcap and Smallcap indices are underperforming the benchmark indices and have plunged over 1 percent each. Investors remained cautious as campaigning ended for Delhi Assembly elections on Thursday; the AAP seemed to have succeeded in rattling its opponents. However, losses remained capped with an HSBC report that India's manufacturing and services sectors expanded at a faster pace than China in January. Among the four largest emerging economies, HSBC said that only India bucked the trend and recorded one of the fastest growth in January.

On global front, Asian equities were trading mixed ahead of US jobs report, while apprehension about Greece's bailout program also weighed on sentiment. Meanwhile, higher oil prices were a bright spot for Asian traders; Brent and US crude traded above $ 50 a barrel after rallying 5% overnight. Back home, Indian rupee appreciated by six paise to 61.67 against the US dollar in early trade on increased selling of the American currency by exporters.

Back on street, stocks from IT, Teck and FMCG counters were supporting the markets’ uptrend, while those from Auto, Banking and Power counters were adding to the underlying cautious undertone. In scrip specific development, shares of Hindustan Copper declined after the company reported a fall of 84.64 percent in its net profit at Rs 10.59 crore for the quarter under review as compared to Rs 68.96 crore for the same quarter in the previous year. On the flip side, shares of Ceat have surged after the company reported an increase of 32.50 percent in its standalone net profit to Rs 80.63 crore for the third quarter ended December 31, 2014.

The market breadth on BSE was negative, out of 2345 stocks traded, 619 stocks advanced, while 1641 stocks declined on the BSE.

The BSE Sensex is currently trading at 28758.63, down by 92.34 points or 0.32% after trading in a range of 28721.80 and 28922.85. There were 10 stocks advancing against 20 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 1.16%, while Small cap index lost 1.40%.

The gaining sectoral indices on the BSE were IT up by 1.06%, TECK up by 0.90% and FMCG up by 0.52%, while Auto down by 2.90%, Bankex down by 1.48%, Power down by 1.22%, Metal down by 1.11% and PSU down by 1.11% were the losing indices on BSE.

The top gainers on the Sensex were HDFC up by 1.93%, Cipla up by 1.90%, Infosys up by 1.66%, Wipro up by 1.52% and Bharti Airtel up by 1.24%. On the flip side, Tata Motors down by 6.03%, GAIL India down by 3.57%, Axis Bank down by 2.69%, Mahindra & Mahindra down by 2.53% and Hero MotoCorp down by 2.46% were the top losers.

Meanwhile, amid mounting concern over the successful auction of coal blocks, the government has called a meeting of 23 companies that owned coal mines that were cancelled, amid spate of legal challenges principally related to compensation and disputes over the quality of some information in the bid documents, particularly with regard to the quality of coal. The meeting is likely to be held under the chairmanship of former Chief Vigilance Commissioner Pratyush Sinham.

The ministry has called CESC, GVK Power, Electrosteel, Hindalco, Jayprakash Associates, Monnet Ispat, Jayswal Necco among others for the meeting. Miners say the government's tender documents exaggerate the quality of coal in several operational mines, and offer no compensation for land taken on lease for mining. GVK Power has already approached the Delhi High Court saying its actual expenditure on building mining infrastructure was significantly higher than what the government has evaluated.

The companies are also claiming that the coal grades mentioned in some cases are at least 20% higher than the real and the whole bidding could be affected with the factual error in the coal grades. Earlier, the ministry had asked the the mine owners to furnish details about the mines, investments made and people employed in order to determine the compensation to be paid against. Though, the ministry is not relying on the data furnished by the companies while putting together the bid documents.

The ministry has also asked owners of 74 blocks in Schedule II and III to share information failing which it would be assumed that no investments have been made by them in the mines and hence no compensation would be payable to them.

The fresh bidders of the coal blocks include the Vedanta group, which has put in the maximum number of bids;  Adani Power and GMR Energy which have bid for all six coal blocks reserved for  the power sector; Essar Power four blocks; Jindal Power three blocks, while Reliance Power has bid for two coal blocks.

The CNX Nifty is currently trading at 8675.15, down by 36.55 points or 0.42% after trading in a range of 8663.10 and 8726.20. There were 13 stocks advancing against 37 stocks declining on the index.

The top gainers on Nifty were Cairn India up by 2.55%, HDFC up by 2.21%, Infosys up by 1.80%, Cipla up by 1.80% and Wipro up by 1.28%. On the flip side, Tata Motors down by 6.03%, Bank Of Baroda down by 4.06%, Jindal Steel & Power down by 3.52%, GAIL India down by 3.43% and Mahindra & Mahindra down by 2.64% were the top losers.

Asian markets were trading mixed; FTSE Bursa Malaysia KLCI increased 0.37%, Straits Times rose 1.01%, Jakarta Composite surged 0.58% and Nikkei 225 was up by 0.80%. On the flip side, Hang Seng dipped 0.28%, Taiwan Weighted decreased 0.52%, Shanghai Composite shed 1.14% and KOSPI Index was down by 0.20%.