Markets continue to trade weak dragged down by realty and banks

Indian markets continue to trade weak in the early noon session, though there is not much selling pressure and the major indices are moving in a tight range but there is also no trigger to let the markets move higher. Traders concerned about the weak monsoon are eyeing the probable stormy monsoon session of the parliament for any further cues. The India Meteorological Department (IMD) has said that there was 8% nation-wide deficiency in monsoon till Sunday. Though, it has also said that the widespread monsoon showers over Karnataka, Kerala, Madhya Pradesh and the North-Eastern states on Sunday are expected to somewhat make up for the pan-India rain deficiency. Back home, the global slump in the commodities too was weighing down the markets and Nifty remains below the 8600 level. Precious metals were routed in global markets as gold sank to the lowest in more than five years amid prospects for higher US rates and after China said it held less metal in reserves than expected. Banking stocks continued moving lower after government decided to keep banks out of the composite foreign investment cap. Traders were also cautious ahead of earnings to be released later this week of index heavyweights including Reliance Industries, Infosys, HDFC Bank.

The BSE Sensex is currently trading at 28355.69, down by 107.62 points or 0.38% after trading in a range of 28319.83 and 28549.13. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.18%, while Small cap index was higher by 0.06%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 0.29%, TECK up by 0.16%, IT up by 0.06%, Auto up by 0.03%, while Realty down by 1.24%, Bankex down by 1.04%, PSU down by 0.46%, Power down by 0.39%, Capital Goods down by 0.27% were the losing indices on BSE.

The top gainers on the Sensex were Hindalco up by 1.58%, Bharti Airtel up by 1.27%, Dr. Reddys Lab up by 0.97%, Mahindra & Mahindra up by 0.91% and TCS up by 0.47%. On the flip side, Axis Bank down by 1.66%, SBI down by 1.35%, BHEL down by 1.30%, Hindustan Unilever down by 1.29% and Tata Motors down by 1.28% were the top losers.

Meanwhile, the continuously falling exports has led the government tackle the issue seriously and constitute a council comprising members of the Centre and states to promote India's overseas shipments. The Union Commerce and Industry Minister will be the chairperson of 'Council for Trade Development and Promotion', while trade/commerce ministers in states and Union Territories will be the members. Besides, 14 secretaries of the central government including commerce, revenue, shipping, civil aviation, agriculture, food processing and economic affairs will also be the members the council. The chairman of the Railway Board, Niti Aayog secretary and CEO, the director generals of Foreign Trade and the Federation of Indian Export Organisations, representatives of industry chambers CII and FICCI and the joint secretary, commerce will also be the members of the cauncil.

The newly constituted council will provide a platform to state governments and UTs for articulating their perspective on trade policy to help them develop and pursue export strategies in line with national foreign trade policy. The central and state governments would also deliberate in the council on the relevant infrastructure to promote trade and identify impediments and infrastructure gaps adversely affecting exports. The council also aims at achieving the $900 billion exports target by 2019-20.

Last month Commerce and Industry ministry had asked states to expedite infrastructure development process and to formulate a trade policy in order to boost exports. Till now as many as 21 states have appointed export commissioners while 14 states including Madhya Pradesh and Gujarat have framed strategies for outward shipments.

India's merchandise exports declining further for the seventh straight month in June stood at $22.29 billion, almost 16 percent lower than the $26.48 billion worth shipped in the same month of last year. Cumulative exports for the period April-June 2015-16 at $66.69 billion registered a 16.75 percent decline over that in the corresponding quarter ($80.11 billion). Earlier, the FIEO had warned that the continuing decline in exports would result in layoffs, besides putting pressure on the current account deficit (CAD).

The CNX Nifty is currently trading at 8570.15, down by 39.70 points or 0.46% after trading in a range of 8559.00 and 8623.90. There were 16 stocks advancing against 33 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 1.68%, Idea Cellular up by 1.52%, Bharti Airtel up by 1.29%, BPCL up by 1.26% and Mahindra & Mahindra up by 1.12%. On the flip side, Ultratech Cement down by 2.78%, PNB down by 2.76%, ACC down by 2.66%, Tata Power down by 2.24% and Bank Of Baroda down by 2.21% were the top losers.

The Asian markets were trading mostly in red, except Straits Times up by12.81 points or 0.38% to 3,366.26 and Shanghai Composite higher by 19.31 points or 0.49% to 3,976.66. On the other hand, Taiwan Weighted lost 70.98 points or 0.78% to 8,975.00, Hang Seng was down by 48.52 points or 0.19% to 25,366.75, FTSE Bursa Malaysia KLCI declined by 4.46 points or 0.26% to 1,722.27 and KOSPI Index decreased 3.48 points or 0.17% to 2,073.31.