Choppiness continues on Dalal Street in noon deals

Indian equity benchmarks continue to trade choppy in noon deals with frontline gauges trading tad below their neutral lines as investors remained on sidelines ahead of the Industrial Production data (IIP) to be released later in the day. Traders are also eying consumer price inflation (CPI) data which is expected to nudge up slightly in June. However, losses remained capped as some support came after International Monetary Fund (IMF) in its World Economic Outlook Update has said that India will be the world’s fastest growing economy for the second consecutive year in 2016 at 7.5 per cent.

On the global front, European counters have made a firm start with CAC, DAX and FTSE, all were trading in green with a gain of around two percentage points in early deals. Asian markets were trading mostly in green at this point of time after Greece offered new reform proposals to creditors, raising hopes of a cash-for-reform deal at a weekend summit of European leaders. Back home, on the sectoral front, capital goods, metal and banking witnessed the maximum gain in trade, while fast moving consumer durables, realty and consumer durables remained the top losers on the BSE sectoral space. The broader indices managed to keep their head above water, while the market breadth on the BSE was positive; there were 1,300 shares on the gaining side against 1,176 shares on the losing side while 99 shares remain unchanged.

The BSE Sensex is currently trading at 27544.42, down by 29.24 points or 0.11% after trading in a range of 27530.90 and 27729.46. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.04%, while Small cap index up by 0.02%.

The few gaining sectoral indices on the BSE were Capital Goods up by 0.67%, Metal up by 0.39%, Bankex up by 0.25% and Healthcare up by 0.13%, while FMCG down by 1.09% Realty down by 1.05%, Consumer Durables down by 0.80%, TECK down by 0.48% and Infrastructure down by 0.34% were the top losing indices on BSE.

The top gainers on the Sensex were Vedanta up by 2.37%, Coal India up by 1.41%, BHEL up by 1.38%, Reliance Industries up by 1.26% and Sun Pharma up by 1.15%. On the flip side, Bharti Airtel down by 2.99%, Hindustan Unilever down by 2.68%, GAIL India down by 2.13%, NTPC down by 2.06% and ONGC down by 1.92% were the top losers.

Meanwhile, International Monetary Fund (IMF) in its World Economic Outlook Update has said that India will be the world’s fastest growing economy for the second consecutive year in 2016 at 7.5 per cent. The global agency though lowered its current year global economy growth forecast to 3.3 per cent, but it retained India’s growth projection for current year at 7.5 per cent which will be higher than China’s 6.8 per cent. It forecast a growth rate of 7.5 per cent for India in 2016 as well, as against China’s 6.3 per cent.

For India, IMF follows data for fiscal year ending March, while for other countries it considers the December-ending periods. It has retained the projection made earlier in April for both India and China and said that in emerging market economies the continued growth slowdown reflects several factors, including lower commodity prices and tighter external financial conditions, structural bottlenecks, rebalancing in China, and economic distress related to geopolitical factors. Growth in emerging market and developing economies has been estimated at 4.2 per cent in 2015, down 0.1 per cent from the projection made April.

IMF has said that “Global growth is projected at 3.3 per cent in 2015, marginally lower than in 2014 and 0.2 percentage point below what it predicted in April, with a gradual pickup in advanced economies and a slowdown in emerging market and developing economies. In 2016, growth is expected to strengthen to 3.8 per cent.”

It said that rebound in activity in a number of distressed economies is expected to result in a pickup in growth in 2016. Though, it pinned much of the blame for the lower growth forecast on the United States and said it expected the US economy to grow 2.5 percent this year. Surprisingly, the IMF maintained its forecasts for a pickup in growth in the euro zone, despite Greece moving ever closer to the edge of default and an exit from the currency bloc.

The CNX Nifty is currently trading at 8322.20, down by 6.35 points or 0.08% after trading in a range of 8315.40 and 8376.35. There were 23 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were Vedanta up by 2.30%, Zee Entertainment up by 2.28%, Grasim Industries up by 1.71%, Bank Of Baroda up by 1.57% and BPCL up by 1.54%. On the flip side, Bharti Airtel down by 3.25%, Hindustan Unilever down by 2.86%, Idea Cellular down by 2.86%, TCS down by 2.01% and GAIL India down by 1.97% were the top losers.

Asian markets were trading mostly in green; KOSPI Index rose 3.36 points or 0.17% to 2,031.17, FTSE Bursa Malaysia KLCI increased 12.75 points or 0.75% to 1,714.29, Straits Times gained 17.01 points or 0.52% to 3,284.41, Jakarta Composite jumped 31.94 points or 0.66% to 4,870.22, Shanghai Composite soared 186.99 points or 5.04% to 3,896.32 and Hang Seng was up by 550.21 points or 2.26% to 24,943.00.

On the flip side, Nikkei 225 decreased by 75.67 points or 0.38% to 19,779.83 and Taiwan Weighted was down by 61.98 points or 0.69% to 8,914.13.

European Markets were trading in the green; Germany’s DAX gained 1.90%, UK’s FTSE rose 1.06% and France’s CAC was up by 2.45%.