Benchmarks trim losses; trade continues in red

Indian equity markets trimmed their losses and continue to trade weak in late afternoon session on account of selling in frontline blue chip counters. The sentiments were under pressure as markets were buffeted by worries about a slowdown in global growth. A survey showed Chinese factories contracted at their fastest pace since the depth of the global financial crisis in 2009. Additionally, foreign investors have been pulling out funds from emerging markets in hordes, of late Indian markets have been no exception, as per the provisional data FIIs yesterday offloaded shares worth Rs 1,007 crore. Traders were seen piling position in IT stocks while selling was witnessed in Realty, Auto and Capital Goods sector stocks. In scrip specific development, Tata Communications were trading in green on reports that Google and e-commerce giant Amazon are in talks with Tata Group to buy Tata Communications’ data centre business.

On the global front, the Asian markets traded mostly in red, while the European markets were trading on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading below the psychological 8,300 and 27,300 levels respectively. The market breadth on BSE was negative in the ratio of 693:1926 while 93 scrips remained unchanged.

The BSE Sensex is currently trading at 27234.21, down by 373.61 points or 1.35% after trading in a range of 27131.44 and 27442.82. There were 3 stocks advancing against 27 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 1.09%, while Small cap index down by 1.26%.

The gaining sectoral indices on the BSE was IT up by 0.03%, while Realty down by 3.06%, Auto down by 2.50%, Capital Goods down by 2.00%, Bankex down by 2.00% and PSU down by 1.36% were the losing indices on BSE.

The top gainers on the Sensex were Hindustan Unilever up by 0.61%, Sun Pharma up by 0.56% and Infosys up by 0.51%.

On the flip side, Vedanta down by 4.62%, Hero MotoCorp down by 3.19%, Bajaj Auto down by 3.10%, GAIL India down by 2.85% and Bharti Airtel down by 2.83% were the top losers.

Meanwhile, Commerce Secretary Rita Teaotia has said that the government is working on a multi-pronged strategy in order to enhance exports competitiveness and address infrastructural bottlenecks. The ministry is focusing on exports sectors with a huge potential such as pharmaceuticals, ready-made garments, leather, gems and jewellery, chemicals and agro-chemicals. Further, the ministry is also looking at cost of credit for exporters. Besides, the issue on interest subvention which will give clarity for exporters should be placed in front of Cabinet as early as possible.

She added that the trade facilitation can play a vital role in boosting competitiveness of domestic exports. Contracting for the eighth month in a row, India’s exports slipped 10.3 per cent in July to USD 23.13 billion, hit by global slowdown and a dip in crude oil prices, which in turn impacted the value of petroleum products.

Secretary said that pharmaceutical and ready-made garments (RMG) in textiles sectors have continued to grow, despite global slowdown and currency depreciation. In the month of July pharmaceutical exports grew about 11% to $1.46 billion, whereas RMG exports recorded a growth of 6.56% at $1.54 billion. However, the sectors which recorded negative growth in the month of July include petroleum products for about 43.22%, leather and leather goods, marine products and chemicals. Oil imports, which account for about 31% of total pie, dropped 34.91% in the same month to $9.48 billion. While highlighting petroleum sector, secretary said that the petroleum is a big chunk in exports and imports basket, whatever happens in this sector, it impacts India's trade stating that petroleum products contributes 18% of the country's total exports.

The CNX Nifty is currently trading at 8263.35, down by 109.40 points or 1.31% after trading in a range of 8225.05 and 8305.40. There were 8 stocks advancing against 42 stocks declining on the index.

The top gainers on Nifty were Ambuja Cement up by 1.09%, Hindustan Unilever up by 0.93%, Infosys up by 0.85%, Tech Mahindra up by 0.57% and Tata Power up by 0.52%.

On the flip side, Vedanta down by 4.87%, Yes Bank down by 4.27%, Ultratech Cement down by 3.62%, Bosch down by 3.44% and Bajaj Auto down by 3.11% were the top losers.

The Asian markets were trading mostly in red; Nikkei 225 decreased 597.69 points or 2.98% to 19,435.83, Hang Seng decreased 347.85 points or 1.53% to 22,409.62, Taiwan Weighted decreased 242.89 points or 3.02% to 7,786.92, Shanghai Composite decreased 156.55 points or 4.27% to 3,507.74, Jakarta Composite decreased 90.11 points or 2.03% to 4,351.80, Straits Times decreased 39.88 points or 1.33% to 2,969.90 and KOSPI Index decreased 38.48 points or 2.01% to 1,876.07.

On the other hand, FTSE Bursa Malaysia KLCI increased 1.32 points or 0.08% to 1,578.73.

The European markets were trading in red; Germany’s DAX decreased 47.75 points or 0.46% to 10,384.44, France’s CAC decreased 26.81 points or 0.56% to 4,756.74 and UK’s FTSE 100 decreased 38.85 points or 0.61% to 6,329.04.