Benchmarks make flat opening; Nifty slips below 7950 level

After a sharp fall in previous session, benchmarks have made a flat opening and are trading in red with the losses of around 0.20 percent. The session was also negative for broader indices, which succumbing to selling pressure, were trading with losses in the range of 0.25-0.45%. Investors’ sentiment was down-beat on reports that foreign portfolio investors (FPIs) sold shares worth a net Rs 622.89 crore on June 11, 2015 (as per provisional data released by the stock exchanges). Some caution also prevailed ahead of Index of Industrial Production (IIP) data for April and Consumer Price Index (CPI) data for May scheduled to be released later in the day. However, losses remained capped with an OECD report that Indian economy saw the “strongest growth” in the first quarter of 2015 among large economies, including China, the US, Germany and Canada.

In scrip specific development, Reliance Industries was trading higher ahead of the company’s 41st Annual General Meeting (AGM) Scheduled today, while Novartis India was trading lower as the company denied reports of delisting plans by Swiss parent Novartis AG.

On the global front, the US markets closed higher on Thursday as retail sales data lifted the outlook for consumer spending. Asian markets were mostly trading in green after Chinese data on industrial production largely met expectations.

Back home traders were seen piling position in Oil & Gas, IT, FMCG and TECK, while selling was witnessed in Metal, INFRA, Bankex, Auto and Healthcare. The market breadth on BSE was negative in the ratio of 625: 940 while 74 scrips remained unchanged.

The BSE Sensex is currently trading at 26336.43, down by 34.55 points or 0.13% after trading in a range of 26307.56 and 26414.30. There were 14 stocks advancing against 16 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.26%, while Small cap index down by 0.45%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 0.48%, IT up by 0.18%, FMCG up by 0.13% and TECK up by 0.09%, while Metal down by 1.30%, INFRA down by 0.73%, Bankex down by 0.68%, Auto down by 0.61% and Healthcare down by 0.47% were the losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 0.88%, Tata Power up by 0.71%, Wipro up by 0.61%, Infosys up by 0.59% and Bajaj Auto up by 0.56%. On the flip side, Vedanta down by 2.26%, Tata Motors down by 1.77%, Hindalco down by 1.47%, Coal India down by 1.40% and Sun Pharma down by 0.89% were the top losers.

Meanwhile, the central government has approved a Rs 6,000-crore interest-free loan to the sugar industry to enable it to clear cane arrears to farmers that stand at Rs 21,000 crore. The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, also agreed to provide a one-year moratorium on loan repayment and decided to bear the cost of interest subvention, to the extent of Rs. 600 crore, for the period.

This is the second time that the Centre has given an interest-free loan to millers to clear arrears, after its December 2013 decision, when it gave an interest-free loan of Rs 6,600 crore. The CCEA has however decided this time that the loans be given to units that cleared at least 50 per cent of their arrears before June 30. Union Minister for Road Transport and Highways Nitin Gardkari has stated that Sugar mills will prepare a list of farmers whose dues they have to clear and banks will transfer the amount to the Jan Dhan accounts of cane growers.

Nitin Gadkari further stated that government had already taken several measures to support the sugar sector, including an increase in sugar import duty to 40 per cent, raising export subsidy on raw sugar and an increase in ethanol prices to promote its blending with petrol.

India is likely to start the 2015/16 marketing year starting October 1 with carry-forward stocks of 10.3 million tonnes, up 37 percent from the current year and the country is likely to produce 28.5 million tonnes of sugar in the current marketing year ending on September 30, nearly 4.5 million tonnes higher than local requirement.

The CNX Nifty is currently trading at 7948.30, down by 17.05 points or 0.21% after trading in a range of 7940.85 and 7973.75. There were 18 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were Asian Paints up by 1.35%, Tata Power up by 0.93%, Reliance Industries up by 0.89%, BPCL up by 0.72% and Infosys up by 0.67%. On the flip side, Ambuja Cement down by 2.79%, Vedanta down by 2.63%, ACC down by 2.23%, Bank Of Baroda down by 2.22% and Tata Motors down by 1.86% were the top losers.

Asian markets were mostly trading in green; Nikkei 225 increased 0.57 points or 0% to 20,383.54, FTSE Bursa Malaysia KLCI increased 2.01 points or 0.12% to 1,736.77, Straits Times increased 6.98 points or 0.21% to 3,354.65, Jakarta Composite increased 9.52 points or 0.19% to 4,938.33, Shanghai Composite increased 22.45 points or 0.44% to 5,144.04 and Hang Seng increased 180.89 points or 0.67% to 27,088.74.

On the flip side, Taiwan Weighted decreased 7.24 points or 0.08% to 9,295.25 and KOSPI Index decreased 2.8 points or 0.14% to 2,053.81.