Markets continue to trade in red in early noon session

Indian equity benchmarks continued to trade in red in early noon session weighed down by selling in metal, Consumer Durables, PSU, Oil & Gas and Capital Goods stocks, amid weak global cues. Further, investors were cautious ahead of October series expiry in the derivatives segment on Thursday. Depreciation in the rupee too dampened sentiment. The rupee was marginally down against the dollar in noon trade on Tuesday due to month-end demand for the US currency from importers.

On the global front, Asian markets were trading in red, as investors awaited monetary policy announcements from central banks and the outcome of China's economic planning meeting. Back home, both sensex and nifty were trading below crucial 27,300 and 8,250 levels, respectively. In scrip specific development, share of JSW Energy was trading up by 2.50% after the company proposed to delist its step down subsidiary South African Coal Mining Holding (SACMH) on Johannesburg Stock Exchange. On the flip side, Lupin was trading down by 3.36% ahead of its Q2 earnings which are due later in the day.
 
The market breadth on BSE was negative, out of 2383 stocks traded, 956 stocks advanced, while 1293 stocks declined on the BSE.

The BSE Sensex is currently trading at 27244.23, down by 117.73 points or 0.43% after trading in a range of 27209.52 and 27296.30. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in green and red; the BSE Mid cap index was up by 0.09%, while Small cap index was down by 0.02%.

The lone gaining sectoral index on the BSE was Auto up by 0.03%, while Metal down by 0.88%, Consumer Durables down by 0.72%, PSU down by 0.48%, Oil & Gas down by 0.29%, Capital Goods down by 0.26% were the top losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 1.60%, Maruti Suzuki up by 0.94%, Bajaj Auto up by 0.41%, Wipro up by 0.35% and Dr. Reddys Lab up by 0.22%. On the flip side, HDFC down by 3.00%, ONGC down by 2.85%, Lupin down by 2.65%, Tata Steel down by 1.86% and BHEL down by 1.26% were the top losers.

Meanwhile, amid volatility in the stock markets, the department of disinvestment (DoD) wants that PSU stake sale target to be more than halved to Rs 30,000 crore for the current financial year, stating that this target seems more reasonable given that there is no big stock to sell.

For the fiscal year 2015-16, the government has targeted to raise Rs 69,500 crore through disinvestment, 180 per cent higher than the total amount garnered from PSU share sales in the previous fiscal. Out of the total budgeted target, Rs 41,000 crore is to come from minority stake sale in PSUs and the remaining Rs 28,500 crore from the strategic stake sale. In order to achieve the target the growth rate in disinvestment, proceeds would need to be around 180 per cent which is much higher than the tax revenue growth rate of 16 per cent and that of government bonds of 10 per cent

The government has a pipeline of over 20 PSUs for disinvestments in 2015-16. These include 10 per cent stake sale each in Oil India (OIL), National Aluminium Company (Nalco), National Mineral Development Corporation (NMDC), and five per cent each in National Thermal Power Corporation(NTPC), Oil and Natural Gas Corporation (ONGC) and Bharat Heavy Electricals (BHEL). Besides, plans are afloat for a 10 per cent stake sale in Coal India. However, volatile market conditions have dented the prospects of a stake sale, with the recent disinvestments of IOC and PFC facing rough weather.

For the current financial year, with seven months to be over, the government has been able to sell stake only in four companies including Power Finance Corporation (PFC), Rural Electrification Corporation (REC), Dredging Corp and Indian Oil Corporation (IOC) to net Rs 12,600 crore.

For five consecutive financial years, the government has missed its disinvestment target. During last financial year out of the total target of Rs 58,425 crore, the government raised around Rs 25,000 crore. The Rs 58,425-crore target included Rs 43,425 crore from minority stake sale and Rs 15,000 crore from residual stake sale in erstwhile PSUs.

The CNX Nifty is currently trading at 8224.65, down by 35.90 points or 0.43% after trading in a range of 8217.05 and 8241.95. There were 17 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were Sun Pharma up by 1.65%, BPCL up by 1.15%, Maruti Suzuki up by 1.02%, Idea Cellular up by 0.74% and Asian Paints up by 0.64%. On the flip side, ONGC down by 3.06%, HDFC down by 2.99%, Lupin down by 2.61%, Tata Steel down by 2.02% and Ambuja Cement down by 1.73% were the top losers.

Asian markets were trading in red; Nikkei 225 decreased 131.77 points or 0.7% to 18,815.35, Hang Seng decreased 116.09 points or 0.5% to 23,000.16, Jakarta Composite decreased 54.4 points or 1.16% to 4,637.31, Taiwan Weighted decreased 44.04 points or 0.5% to 8,701.32, Shanghai Composite decreased 35.04 points or 1.02% to 3,394.54, FTSE Bursa Malaysia KLCI decreased 9.34 points or 0.55% to 1,697.45 and KOSPI Index decreased 7.71 points or 0.38% to 2,040.37.