Benchmarks continue to reel under pressure in noon deals

Indian equity benchmarks continue to reel under pressure in noon deals with Sensex and Nifty declining below their crucial 27,300 and 8,250 mark, respectively. Sentiments remained down-beat on report that foreign institutional investors have reduced their holdings in 19 blue chip firms that are part of the 30-share benchmark Sensex during July-September quarter as they recast their portfolio on account of several domestic and global factors. Investors were wary ahead of October series expiry in the derivatives segment on Thursday and Fed policy meet. Meanwhile, the initial public offering (IPO) of InterGlobe Aviation, the promoter of low-cost carrier IndiGo, received good response on the first day on Tuesday, with the qualified institutional investor (QIB) quota getting oversubscribed within the first hour.

On the global front, Asian equity indices were trading mostly in red at this point of time, as investors took cover ahead of central bank meetings in the United States and Japan later in the week. Back home, on the sectoral front realty, banking and auto witnessed the maximum gain in trade, while consumer durables, metal and public sector undertaking remained the top losers on the BSE sectoral space. The broader indices, however, managed to keep their head above water, while the market breadth on the BSE was negative; there were 1,051 shares on the gaining side against 1,322 shares on the losing side while 146 shares remain unchanged.

The BSE Sensex is currently trading at 27259.15, down by 102.81 points or 0.38% after trading in a range of 27209.52 and 27296.30. There were 10 stocks advancing against 20 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.17%, while Small cap index up by 0.13%.

The few gaining sectoral indices on the BSE were Realty up by 0.10%, Bankex up by 0.07% and Auto up by 0.01%, while Consumer Durables down by 0.86%, Metal down by 0.80%, PSU down by 0.44%, Oil & Gas down by 0.43% and Goods down by 0.31% were the top losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 1.30%, Maruti Suzuki up by 0.96%, Bajaj Auto up by 0.67%, HDFC Bank up by 0.59% and Wipro up by 0.46%. On the flip side, ONGC down by 2.81%, HDFC down by 2.73%, Lupin down by 2.61%, Tata Steel down by 1.78% and Vedanta down by 1.67% were the top losers.

Meanwhile, the government has promised stakeholders to resolve the regulatory and financing issues in the infrastructure sector to expedite infrastructure projects especially those which are being promoted under the public-private partnership (PPP) mode. This assurance came after the meeting taken by Shaktikanta Das, Secretary, Economic Affairs with the representatives of the infrastructure companies on Monday, October 26, 2015.

Das held a meeting with infrastructure consultants, players and lenders, who have burnt their fingers in PPP. The meeting was organized by industry chamber CII and was also attended by RBI Deputy Governor R Gandhi, SBI Chairperson Arundhati Bhattacharya and officials from infrastructure ministries. In the meeting the industry representatives raised regulatory and financing issues, difficulties and certain issues which they have been encountering as well as capacity building.

Besides, issues concerning dispute resolution with regard to concession agreement for implementing Public Private Partnership (PPP) projects were also discussed. The government has already set up a committee under former finance secretary Vijay Kelkar to suggest a framework for revitalizing the PPP model, which has faced some trouble after initial success. The terms of reference of the committee include measures to improve capacity building in government for effective implementation of PPP projects, review of experience of PPP policy, analysis of risks involved in such projects in different sectors and existing framework of sharing of such risks between project developer and government.

Das also said that the panel is expected to submit its report by November. Some of the recommendations, if accepted by the government, can be operationalised far quicker. But some of the recommendations may require little more time. So it will depend on content of recommendation of the Kelkar panel. Further discussion in this regard would also take place between the RBI, banks and department of Financial Services.

The CNX Nifty is currently trading at 8231.15, down by 29.40 points or 0.36% after trading in a range of 8217.05 and 8241.95. There were 20 stocks advancing against 29 stocks declining on the index while 1 stock remained unchanged.

The top gainers on Nifty were Sun Pharma up by 1.60%, BPCL up by 1.15%, Maruti Suzuki up by 0.98%, Idea Cellular up by 0.95% and Asian Paints up by 0.93%. On the flip side, ONGC down by 2.98%, HDFC down by 2.72%, Vedanta down by 2.62%, Lupin down by 2.61% and Tata Steel down by 1.80% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 decreased 170.08 points or 0.9% to 18,777.04, Jakarta Composite declined 44.27 points or 0.94% to 4,647.44, Taiwan Weighted dipped 44.04 points or 0.5% to 8,701.32, FTSE Bursa Malaysia KLCI shed 8.47 points or 0.5% to 1,698.32 and KOSPI Index was down by 3.43 points or 0.17% to 2,044.65. On the flip side, Shanghai Composite increased 9.82 points or 0.29% to 3,439.40 and Hang Seng was up by 21.98 points or 0.1% to 23,138.23.