Markets continue to trade in red; IT outperforms

Indian markets continue to trade in the red terrain in the early noon session, though there were attempts of recovery but were not that serious that they could lift the markets back in green. Both the benchmarks down by about half a percent were hovering below the crucial psychological levels of 27800 (Sensex) and 8400 (Nifty). The global concerns of the Greece failing to meet the deadline to repay the debts were compounded with RBI Governor Raghuram Rajan asking central banks from across the world to define 'new rules of the game' warning that the global economy may be slipping into problems similar to the Great Depression of the 1930s. Though, Rajan stressed that seven years on from the economic crisis, the central banks have done a lot during as well as post-crisis. The weakness in rupee for the second day due to appreciation of the dollar overseas, too weighed on the sentiments of the market. Also, strong rains may have eased concerns of a lower crop output in the region but there were warning of severe dryness in the autumn months that was making the traders cautious. Back on street, the broader markets too continue to trade in a somber mood, though the intensity is lower then the benchmarks, while on sectoral front banking, realty, power, metal and capital goods were dragging the markets lower, on the other hand, some support was coming from IT, consumer durables, tech and healthcare sectors.

The BSE Sensex is currently trading at 27761.04, down by 134.93 points or 0.48% after trading in a range of 27722.14 and 27921.86. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.27%, while Small cap index was up by 0.19%.

The gaining sectoral indices on the BSE were Consumer Durables up by 1.24%, IT up by 1.08%, TECK up by 0.48%, Auto up by 0.06%, while Bankex down by 1.14%, INFRA down by 0.99%, Realty down by 0.98%, Capital Goods down by 0.95%, Power down by 0.94% were the losing indices on BSE.

The top gainers on the Sensex were Cipla up by 1.53%, Infosys up by 1.50%, Dr. Reddys Lab up by 1.21%, TCS up by 0.72% and Wipro up by 0.64%. On the flip side, GAIL India down by 3.03%, Vedanta down by 2.48%, HDFC down by 2.25%, BHEL down by 1.89% and Bharti Airtel down by 1.88% were the top losers.

Meanwhile, Minister of State for Finance Jayant Sinha amid the demand of another rate cut from the Reserve Bank of India (RBI) has said that the 75 basis points rate cut by the RBI since January will help boost growth along with structural reforms and thrust on infrastructure investments by the government.

The minister said that 'We already had 75 basis points of interest rate cuts. So we are going to see that cyclical upswing that happens when rates come down and inflation is under control... That's the first growth driver.' He added that structural reforms such as higher foreign investment caps in insurance, defence and other sectors and progress on GST will also help attain higher growth.

Jayant Sinha also said that increased focus on infrastructure investment, under which the government has increased the gross budgetary support to public infra projects by a whopping Rs 70,000 crore this year, shall aid the growth process, adding that even though the Narendra Modi regime inherited a weak economy it has been successful in getting it in a relatively better shape now.

The CNX Nifty is currently trading at 8365.90, down by 32.10 points or 0.38% after trading in a range of 8352.50 and 8408.55. There were 18 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were HCL Tech. up by 2.69%, Infosys up by 1.63%, Cipla up by 1.57%, Dr. Reddys Lab up by 1.28% and BPCL up by 1.23%. On the flip side, GAIL India down by 3.38%, Vedanta down by 2.56%, Cairn India down by 2.42%, HDFC down by 2.15% and BHEL down by 1.91% were the top losers.

The Asian markets were mostly in red barring, KOSPI Index which was up by 5.2 points or 0.25% to 2,090.26 and Jakarta Composite which increased by 6.93 points or 0.14% to 4,926.97.

On the other hand, Hang Seng slumped by 507.2 points or 1.87% to 26,638.55, Shanghai Composite plunged by 333.09 points or 7.36% to 4,194.69, Nikkei 225 lost, 65.25 points or 0.31% to 20,706.15, Straits Times was down by16.76 points or 0.5% to 3,333.11,Taiwan Weighted declined by 13.77 points or 0.15% to 9,462.57 and FTSE Bursa Malaysia KLCI was lower by 3.36 points or 0.2% to 1,713.45.