Benchmarks trade in negative terrain; Sensex below 27000 level

Indian equity markets after making a flat opening with positive bias, have turned in red with cut of above quarter a percent that dragged both the Senxex and Nifty below their psychologically 27000 and 8150 levels respectively, as investors opted to book some profit after last many session’s of rally. Investor sentiment turned negative on reports that foreign portfolio investors (FPIs) sold shares worth a net Rs 50.60 crore yesterday, as per provisional data released by the stock exchanges. Further, caution prevailed on the bourses ahead of September earning season due to kick-off next week. A Crisil Research report has said that for the fifth consecutive quarter, India Inc is expected to report single-digit growth in revenues. This is mainly because of fragile consumption demand, especially in the rural areas, weakness in investment-linked sectors, and the meltdown in global commodity prices.

 In the scrip specific development, HCL Infosystems  surged 10%, extending its previous day’s 20% rally on the BSE, after Derive Investments, an investment company run by Radhakishan Damani, bought nearly two percent  stake in the company at an average price of Rs 49.38 apiece through open market. Genesys International Corporation was locked in upper circuit of 20% at Rs 69.30 on the BSE after the company announced that Quikr, an online cross-category classifieds company, is making an investment in Genesys' venture A.N.Virtual World Tech.

On the global front, the US markets ended higher, with Dow posting its longest winning streak since July, ahead of Fed minutes. The Asian markets were trading mixed despite a positive lead from Wall Street, with Chinese equities outperforming after mainland markets resumed trade following a week-long holiday.

Closer home traders were seen piling up position in  IT, Consumer Durables, Metal, TECK and Auto, while selling was witnessed in FMCG, Bankex, Capital Goods, Oil & Gas and Power. The market breadth on BSE was positive in the ratio of 863: 781while 71scrips remained unchanged. 

The BSE Sensex is currently trading at 26960.58, down by 75.27 points or 0.28% after trading in a range of 26944.16 and 27120.11. There were 14 stocks advancing against 16 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.47%, while Small cap index lost 0.04%.

The gaining sectoral indices on the BSE were IT up by 0.75%, Consumer Durables up by 0.55%, Metal up by 0.45%, TECK up by 0.40% and Auto up by 0.24%, while FMCG down by 0.88%, Bankex down by 0.75%, Capital Goods down by 0.53%, Oil & Gas down by 0.49% and Power down by 0.25% were the losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 1.60%, Vedanta up by 1.54%, Infosys up by 1.22%, Wipro up by 0.91% and Tata Steel up by 0.89%. On the flip side, ITC down by 1.96%, Bharti Airtel down by 1.54%, ICICI Bank down by 1.20%, GAIL India down by 1.17% and Larsen & Toubro down by 0.90% were the top losers.

Meanwhile, the government has assured that it will soon announce incentives, including extension of interest subsidy scheme, to boost exports, which are in negative zone since December last year. In a  review meeting chaired by Commerce Secretary Rita Teaotia, which came in the backdrop of declining trend in the exports for which the Commerce Ministry is taking steps to arrest the same for faster export growth in the coming times, export organisations stressed that the interest subvention scheme should be implemented without delay.

Commerce Secretary Rita Teaotia held detailed consultations and deliberations with around 27 Export Promotion Councils to seek their views and suggestions on ways to promote exports. The major issues highlighted by the Export Promotion Councils related to early refund of the duty drawback amounts, credit of interest subvention, increase in the incentives given in the Merchandise Exports from India Scheme (MEIS), governance issues relating to delays in clearances, addition of more items under the MEIS, request for increase in MEIS incentives for certain items, agreements with specific countries to promote exports of certain items.

The Commerce Secretary also informed that the allocations for export incentive schemes in the current financial year has been increased from the earlier Rs 18,000 crore to Rs 21,000 crore and this amount was likely to be available for allocations in the coming week.

However, Commerce Secretary pointed that the Foreign Trade Policy 2015-20 was drawn after extensive deliberations. Hence it may not be possible to make changes very frequently and go back on the scheme and incentives under the Merchandise Export from India Scheme. She said that with the changing paradigms/ dynamics of the export market, exporters should be flexible in responding to the changing economic scenario and should work in the spirit of give and take wherein getting access has to be complimented by giving access to markets.

The CNX Nifty is currently trading at 8148.35, down by 29.05 points or 0.36% after trading in a range of 8147.65 and 8196.75. There were 24 stocks advancing against 26 stocks declining on the index.

The top gainers on Nifty were Vedanta up by 1.71%, Tata Motors up by 1.29%, Infosys up by 1.22%, HCL Tech. up by 1.20% and Wipro up by 0.99%. On the flip side, ITC down by 2.17%, Idea Cellular down by 1.79%, Bosch down by 1.40%, Bharti Airtel down by 1.33% and ICICI Bank down by 1.24% were the top losers.

Asian markets were trading mixed, FTSE Bursa Malaysia KLCI increased 5.44 points or 0.32% to 1,694.69, Jakarta Composite increased 34.78 points or 0.78% to 4,521.91, Shanghai Composite increased 116.11 points or 3.8% to 3,168.89.

On the flip side Nikkei 225 decreased 123.84 points or 0.68% to 18,199.14, Hang Seng decreased 107.97 points or 0.48% to 22,407.79, Taiwan Weighted decreased 12.62 points or 0.15% to 8,482.61, Straits Times decreased 9.74 points or 0.33% to 2,952.07 and KOSPI Index decreased 0.13 points or 0.01% to 2,005.71.