Benchmarks end in red ahead of US jobs data

Indian equity benchmarks ended the Friday’s trade in red as investors remained sidelines ahead of the release of U.S. jobs data that could provide fresh clues to determine whether the Federal Reserve will raise interest rates in September or wait until December. In extremely volatile session, frontline gauges traded in a tight range with Sensex and Nifty swinging between negative and positive zone throughout the session but the major slide came in the last leg of trade where bourses lost their momentum completely to end lower by about a quarter percent. Marketmen remained worried with Rajya Sabha being adjourned again with no work amid protests by the opposition parties, although Finance Minister expressed his hopes of meeting GST deadline.

Sentiments also remained dampened with report that Securities and Exchange Board of India (SEBI) starting crack down on offshore units of major global banks for their suspected role in manipulation of share prices in the Indian stock market. The regulator is closely looking at possible instances where share prices of companies listed in the domestic stock market are being manipulated through offshore centres of foreign banks. However, losses remained capped as some support with finance minister Arun Jaitley’s statement that conditions in India are favourable for further interest rate cuts due to low global commodity prices as well as prospects of good summer crops. Meanwhile, Labour Minister Bandaru Dattatreya said that pension fund could invest more into equities in the next fiscal year starting April by raising the current limit set at 5 per cent of total investable assets.

Global cues remained sluggish with European counters have made a weak opening and were trading in red in early deals after German industrial output declined and exports fell by more than expected, raising questions about the strength of the recovery in Europe’s largest economy. Asian markets ended mostly in red as investors remained cautious ahead of US jobs data that could spur the Federal Reserve to raise interest rates in September.

Back home, the India Meteorological Department (IMD) stated that the rainfall was below normal by 26 percent over the country during the period from 30 July to 5 August 2015. Depreciation in Indian rupee too dampened the sentiments. Rupee was trading at 63.80 per dollar at the time of equity markets closing compared with its previous close of 63.76 per dollar. Weak results of industrial goods makers raised fresh concerns over a much-anticipated recovery in the country’s investment cycle and earnings growth. State-run Bharat Heavy Electricals’ June-quarter profit declined 82.5 per cent, while Larsen and Toubro posted a 37 per cent slide in first-quarter profit.

The NSE’s 50-share broadly followed index Nifty declined by over twenty points but managed to hold its psychological 8,550 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex declined by over sixty points to end below its crucial 28,250 mark. Broader markets too struggled to get any traction during the trade and ended the session with a cut of around quarter a percent. The market breadth remained in favor of decliners, as there were 1,380 shares on the gaining side against 1,542 shares on the losing side while 119 shares remain unchanged.

Finally, the BSE Sensex declined by 61.74 points or 0.22% to 28236.39, while the CNX Nifty lost 24.05 points or 0.28% to 8564.60.

The BSE Sensex touched a high and a low 28335.67 and 28193.93, respectively. The BSE Mid cap index was doen by 0.24%, while Small cap index was down by 0.14%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 1.97%, Consumer Durables up by 0.46% and Auto up by 0.07%, while Power down by 1.47%, Metal down by 0.92%, Bankex down by 0.74%, Capital Goods down by 0.49% and PSU down by 0.42% were the losing indices on BSE.

The top gainers on the Sensex were ONGC up by 4.42%, Tata Motors up by 2.52%, Vedanta up by 2.01%, Hindalco up by 0.92% and Sun Pharma up by 0.59%. On the flip side, BHEL down by 5.81%, Coal India down by 3.61%, SBI down by 2.38%, Bajaj Auto down by 1.46% and NTPC down by 1.33% were the top losers.

Meanwhile, reiterating his commitment to renewable energy, Prime Minister Narendra Modi has directed speeding up of the process of rural electrification and called for stern action against power theft, as he reviewed the progress in projects in energy sector. He also called for accelerating the implementation of renewable energy projects.

Prime Minister in a high-level meeting on various energy sectors, which was attended by senior officials from the concerned Ministries, NITI Aayog and PMO, called for speeding up the process, so as to achieve 100 percent electrification, state-wise, progressively, in a well-defined time frame. He reviewed the progress towards targets in power and coal sectors.

Recently, a report published by the National Sample Survey Office (NSSO), revealed a sharp 24 percentage points drop in the number of rural households using kerosene for lighting, and an equal increase in electrified households since 1999-2000, the date of the last such relevant survey. Presently, 921 projects to electrify 1,20,804 un-electrified villages, intensive electrification of 5,95,883 partially electrified villages had been sanctioned under the flagship Deendayal Upadhyaya Gram Jyoti Yojana.

The CNX Nifty touched a high and low 8595.95 and 8552.70 respectively.

The top gainers on Nifty were ONGC up by 4.28%, Tata Motors up by 2.52%, BPCL up by 2.17%, Vedanta up by 2.17% and Grasim Industries up by 1.49%. On the flip side, BHEL down by 5.58%, Coal India down by 3.71%, SBI down by 2.46%, Bank of Baroda down by 1.98% and Bosch down by 1.70% were the top losers.

European Markets were trading in the red; UK's FTSE was down by 0.04% France’s CAC was down by 0.24% and Germany’s DAX was up by 0.32%.

The Asian markets closed mostly in red on Friday, while Shanghai Composite closed higher on reports that a government agency and Chinese funds are looking to add billions into the stock market. China’s foreign exchange reserves, the world’s largest, fell by $42.5 billion in July to $3.65 trillion, the sharpest monthly drop since March amid signs of capital outflows. China’s slowing economic growth and jitters over the stock market turmoil may be behind the bout of capital flight. Indonesia’s tax revenue growth stagnated in the first seven months of 2015 amid a slowing economy, fostering expectations that the government will need to expand its budget deficit to finance its ambitious infrastructure programs. The property and automotive sectors are expected to boost the economy in the second half of 2015, after Bank Indonesia decided to loosen the lending requirements for purchases of homes, cars and motorcycles. The central bank, in a bid to step up economic growth, recently reduced the minimum down-payment percentages for cars and motorcycles and increased the maximum loan-to-value (LTV) ratio for people buying their first homes. The central bank estimates the economy will grow in the range of 5 to 5.4 percent this year and between 5.4 percent and 5.8 percent next year. Japan’s index of leading economic indicators rose to a seasonally adjusted 107.2, from 106.2 in the preceding month.