Benchmarks magnify losses in noon deals

Local equity markets have magnified their losses in afternoon deals, as sentiments remained dampened after International Monetary Fund (IMF) marginally lowered said India’s growth rate from the previous 7.5 per cent to 7.3 per cent this year due to a difficult external environment. Sentiments were also weighed down on report that foreign investors sold shares worth Rs 50.60 crore on Wednesday as per provisional data. Meanwhile, defensive sectors like FMCG and Pharma remained under pressure on account of profit-booking after witnessing decent buying demand recently.

Global cues too remained choppy with European counters making sluggish start with CAC, DAX and FTSE trading in red with a cut of quarter a percent in early deals. Asian markets are exhibiting mixed trend at this point of time. Chinese markets surged over three percent after a week-long break as they tried catching up to a global rally, while most regional markets stepped back with Japanese equities hitting the skids on weak data. Back home, on the sectoral front, consumer durables and software witnessed the maximum gain in trade, while FMCG, capital goods and banking remained the top losers. The broader indices too were reeling under pressure and the market breadth on the BSE was negative; there were 1,023 shares on the gaining side against 1,402 shares on the losing side while 100 shares remain unchanged.

The BSE Sensex is currently trading at 26821.88, down by 213.97 points or 0.79% after trading in a range of 26805.77 and 27120.11. There were 9 stocks advancing against 21 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index lost 1.02%, while Small cap index was down by 0.45%.

The only gaining sectoral indices on the BSE were Consumer Durables up by 0.09% and IT up by 0.04%, while FMCG down by 1.35%, Capital Goods down by 0.98% Bankex down by 0.96%, Healthcare down by 0.93% and Power down by 0.91%, were the top losing indices on BSE.

The top gainers on the Sensex were Infosys up by 0.72%, Tata Steel up by 0.72%, Tata Motors up by 0.64%, Dr. Reddys Lab up by 0.59% and ONGC up by 0.47%. On the flip side, ITC down by 2.90%, Axis Bank down by 1.99%, Lupin down by 1.61%, NTPC down by 1.60% and ICICI Bank down by 1.40% 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 8119.95, down by 57.45 points or 0.70% after trading in a range of 8112.90 and 8196.75. There were 17 stocks advancing against 33 stocks declining on the index.

The top gainers on Nifty were Ultratech Cement up by 1.72%, Cairn India up by 1.20%, HCL Tech up by 1.13%, Tata Steel up by 0.78% and Infosys up by 0.73%. On the flip side, ITC down by 3.12%, Idea Cellular down by 2.23%, Axis Bank down by 1.96%, NTPC down by 1.64% and ICICI Bank down by 1.54% were the top losers.

Asian markets were trading mixed; Jakarta Composite increased 3.77 points or 0.08% to 4,490.91, FTSE Bursa Malaysia KLCI rose 4.12 points or 0.24% to 1,693.37, KOSPI Index gained 13.69 points or 0.68% to 2,019.53 and Shanghai Composite was up by 94.86 points or 3.11% to 3,147.64.

On the flip side, Hang Seng decreased 258.91 points or 1.15% to 22,256.85, Nikkei 225 declined 181.81 points or 0.99% to 18,141.17, Taiwan Weighted slipped 49.27 points or 0.58% to 8,445.96 and Straits Times was down by 8.93 points or 0.3% to 2,952.88.

European markets were trading in red; Germany’s DAX lost 0.28%, France’s CAC slipped 0.16% and UK’s FTSE was down by 0.24%.