Markets trade in red in early deals

Extending their previous session’s fall, Indian equity markets have made a negative start and are trading in red in early deals on Wednesday. Investors’ sentiment remained weak on report that Reserve Bank of India has lowered the economic growth forecast for the current fiscal to 7.6 percent from 7.8 percent projected in April. The India Meteorological Department has revised its rainfall forecast from 93 to 88 per cent ('below normal' to 'deficient') too kept pressurizing the sentiments. Meanwhile, the session also is daunting for broader indices trading with loss in the range of 0.71-0.80%. However, Rupee opened higher against the dollar on Wednesday and is trading at 63.75, up 7 paise  at the Interbank Foreign Exchange capped some losses. Traders are seen piling position in IT, TECK and Metal, selling is witnessed in FMCG, Realty, INFRA, Auto and Consumer Durables.

In scrip specific development, Nestle was trading lower after the Delhi government summoned officials of Nestle India claiming that the samples of Maggi noodles fail to meet food safety norms and are unsafe. On the flip side, Bharat Heavy Electricals was trading higher after the company achieved the largest order in its history for setting up a 4,000 megawatt (5x800 Mw) super-critical thermal power project from Telangana State Power Generation Corporation (TSGENCO).

On the global Front, The US markets ended lower as a jump in bond yields hit utilities and other top dividend payers. Further, investors remained cautious ahead of the important jobs report on Friday. Asian markets were mostly trading lower as a widespread spike in debt yields dented the allure of risky assets.

Back home, the NSE Nifty and BSE Sensex were trading below the psychological 8,200 and 27,100 levels respectively. The market breadth on BSE was negative in the ratio of 547: 1178 while 57 scrips remained unchanged.

The BSE Sensex is currently trading at 27054.74, down by 133.64 points or 0.49% after trading in a range of 27024.64 and 27276.22. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.80%, while Small cap index lost 0.71%.

The gaining sectoral indices on the BSE were IT up by 0.47%, TECK up by 0.24% and Metal up by 0.09%, while FMCG down by 2.03%, Realty down by 1.65%, Auto down by 1.27%, INFRA down by 1.18%, Consumer Durables down by 1.11% were the losing indices on BSE.

The top gainers on the Sensex were Wipro up by 1.50%, Coal India up by 1.49%, Infosys up by 0.96%, BHEL up by 0.84% and Reliance Industries up by 0.76%. On the flip side, Tata Motors down by 3.06%, ITC down by 3.01%, GAIL India down by 2.24%, ICICI Bank down by 2.02% and Sun Pharma down by 1.72% were the top losers.

Meanwhile, government in order to boost defence manufacturing and encourage foreign players in the sector has further simplified the defence rules and has withdrawn the excise and Customs duty exemptions enjoyed by the Ordinance Factory Board and defence PSUs. This move will provide a level-playing field by taking away the strategic advantage with PSUs for quoting lower rates in open bids. With this initiative, the government has also fulfilled demand of foreign Original Equipment Manufacturers (OEMs) such as Boeing, Airbus, Lockheed Martin, BAE Systems etc which are actively exploring the scope of future investments in India.

A statement from Ministry of Commerce and Industry said that the move will also send a definitive message to foreign OEMs that India is open to business for defence manufacturing. Almost 60 per cent items required for industrial licence have now been de-reserved. The Indian aerospace and defence market is among the most attractive globally as the country is the highest importer of defence items in the world.

Defence manufacturing is one of the key sectors among the 25 sectors identified under the Make-in-India campaign. The ministry statement added that a series of consultations have been held across ministries and departments to enable simplification of rules and procedures to promote private participation in defence manufacturing and exports. The government has already opened up the sector for private investment by increasing FDI cap in defence of up to 49 per cent and rationalising certain conditions.

The CNX Nifty is currently trading at 8183.65, down by 52.80 points or 0.64% after trading in a range of 8176.80 and 8236.70. There were 11 stocks advancing against 37 stocks declining on the index.

The top gainers on Nifty were Wipro up by 1.47%, Coal India up by 1.41%, Infosys up by 1.31%, BHEL up by 1.02% and Reliance Industries up by 0.86%. On the flip side, Tata Motors down by 3.12%, ITC down by 2.79%, ICICI Bank down by 2.25%, Sun Pharma down by 1.86% and Ambuja Cement down by 1.71% were the top losers.

Asian markets were trading mostly in the red; Nikkei 225 decreased 62.63 points or 0.30% to 20480.56, KOSPI Index decreased 3.25 points or 0.16% to 2,075.39, Jakarta Composite decreased 3.25 points or 1.27% to 5,147.74, Shanghai Composite decreased 49.95 points or 1.02% to 4860.58 and Taiwan Weighted decresed 27.19 points or 0.28% to 9,587.07.52.. On the flip side, Hang Seng increased  203.99 points or 0.74% to 27,670.71 and FTSE Bursa Malaysia KLCI incresed 5.62 points or 0.32% to 1,746.99 .