Benchmarks turn red in noon deals

Paring all their early gains, Indian Equity benchmarks have entered into red terrain in noon deals as investors booked profits at higher levels. Sentiments also remained down-beat after global rating agency Fitch lowered India's economic growth projections to 7.8 percent for the current fiscal from 8 percent on pickup in demand and said that the country’s business environment is relatively weak compared with peers and will take time to turn around. However, hopes of Greece deal and advancement of monsoons capped the losses.

On the global front, European counters have made a firm opening with CAC, DAX and FTSE all trading in green in early deals. Asian markets were trading mostly in the green at this point of time on hopes for a deal to keep Greece in the eurozone as the country prepares for a crucial weekend referendum, but Shanghai tumbled again despite authorities relaxing trading rules to temper recent volatility.

Back home, on the sectoral front, oil and gas, fast moving consumer goods and auto witnessed the maximum gain in trade, while metal, consumer durables and software remained the top losers on the BSE sectoral space. The broader indices, however, were outperforming benchmarks, while the market breadth on the BSE was positive; there were 1410 shares on the gaining side against 988 shares on the losing side while 104 shares remain unchanged.

The BSE Sensex is currently trading at 28004.29, down by 16.58 points or 0.06% after trading in a range of 27961.08 and 28115.96. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.54%, while Small cap index up by 0.64%.

The gaining sectoral indices on the BSE were Oil & Gas up by 0.93%, FMCG up by 0.66%, Auto up by 0.45%, TECK up by 0.22% and PSU up by 0.14%, while Metal down by 0.85%, Consumer Durables down by 0.46%, IT down by 0.18%, Capital Goods down by 0.14% and Bankex down by 0.07% were the losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 1.88%, Bharti Airtel up by 1.66%, Bajaj Auto up by 1.60%, Hero MotoCorp up by 1.28% and Reliance Industries up by 0.89%. On the flip side, Tata Motors down by 1.45%, Coal India down by 1.18%, Hindalco down by 1.06%, HDFC Bank down by 0.98% and Vedanta down by 0.91% were the top losers.

Meanwhile, global rating agency Fitch lowered India's economic growth projections to 7.8 percent for the current fiscal from 8 percent on pickup in demand and said that the country’s business environment is relatively weak compared with peers and will take time to turn around. In its Global Growth Outlook report, it said that Fitch continues to expect an acceleration in Indian growth, but there are some indications that it may be somewhat slower than previously expected.

In its report the rating agency has cited that capital expenditure has not yet picked up, rural and export demand is weak, and the translation of monetary policy loosening into lower bank lending rates is limited. Downside risks to growth relate, for instance, to below-average rainfall during this year’s monsoon season, although the first three weeks of June recorded 16 per cent above-average rainfall.

Though, the rating agency maintained the expectation for an increase in growth, it lowered its real GDP growth forecasts for India to 7.8 percent and 8.1 percent from 8.0 percent and 8.3 percent for FY16 and FY17, respectively. It said that India’s GDP growth will surpass China’s this year for the first time since 1999, and accelerate to 8 per cent in 2016 and 8.1 per cent in 2017 before settling back to 8.0 per cent in 2017-18. It added that “The implementation of structural reforms and resulting pick-up in investment remain key themes for India's growth outlook, and recent data confirm the strengthening demand.”

Regarding global economy, it said that emerging Asia will continue to experience relatively high rates of growth over the medium term as economic prospects remain starkly divergent across emerging markets. It expects that growth should improve steadily through to 2017 for emerging Asia excluding China on aggregate.

The CNX Nifty is currently trading at 8450.45, down by 2.60 points or 0.03% after trading in a range of 8437.20 and 8479.25. There were 25 stocks advancing against 24 stocks declining on the index, while one stock remained unchanged.

The top gainers on Nifty were Mahindra & Mahindra up by 2.10%, Bharti Airtel up by 1.60%, Bajaj Auto up by 1.55%, Bosch up by 1.48% and BPCL up by 1.35%. On the flip side, Grasim Industries down by 1.48%, Tata Motors down by 1.37%, Coal India down by 1.28%, Tata Steel down by 1.19% and HDFC Bank down by 1.07% were the top losers.

Asian markets were trading mostly in green; Taiwan Weighted rose 4.01 points or 0.04% to 9,379.24, FTSE Bursa Malaysia KLCI increased 6.98 points or 0.4% to 1,734.94, KOSPI Index gained 9.44 points or 0.45% to 2,107.33, Jakarta Composite added 35.84 points or 0.73% to 4,939.90 and Nikkei 225 was up by 193.18 points or 0.95% to 20,522.50.

On the flip side, Shanghai Composite tumbled 202.79 points or 5% to 3,850.91, Hang Seng decreased 2.1 points or 0.01% to 26,247.93 and Straits Times was down by 1.21 points or 0.04% to 3,329.93.

The European markets were trading in green; Germany’s DAX rose 0.19%, France’s CAC gained 2.03% and UK’s FTSE 100 was up by 0.08%.