Benchmarks continue to trade in red in late morning session

Indian equity benchmarks continued to trade in red in the late morning session, as funds and retail investors engaged in reducing positions. Investor around the world turned cautious after the US economic data released yesterday showed some positivity in consumer prices as well as manufacturing data thus providing room for a December rate hike. Sentiments remained subdued on report that foreign portfolio investors (FPIs) sold shares worth a net Rs 492.45 crore on November 17, 2015. Further, India's exports declined for the eleventh month running in October, highlighting the stiff competition faced by the country in a weak global economy that also weighed on the sentiment.  However, market participants got some relief with Finance Minister Arun Jaitley’s statement that low oil prices have created a favourable environment for the Indian economy as it helped to absorb the loss faced by state-run marketers and kept inflation under control. He also said low oil prices also means effectively transfer of wealth from the producing nations to the consuming nations. Meanwhile, some metals and mining stocks remained under pressure with the report that Supreme Court sought response from the state and several mining companies on petitions challenging the renewal of 89 mining leases by Goa government. However, sugar stocks zoomed again on report that Government may consider subsidy for sugar cane farmers.

On the global front, Asian markets were broadly positive despite a major renewed selloff in commodities overnight following a strong European session and a fairly flat US session. Overnight, US stocks ceded earlier gains to end almost flat as falling oil prices overshadowed strong earnings from giant retailers Wal-Mart Stores and Home Depot Inc.  Back home, stocks from Consumer Durables, Power and Capital Goods counters were supporting the markets’ uptrend, while those from IT, TECK and Realty counters were adding to the underlying cautious undertone.
In scrip specific development, shares of Dishman Pharmaceuticals and Chemicals surged after the company clarified that it has not received any warning from the United States Food and Drug Administration (USFDA) on Clovis issue. Furthermore, shares of Persistent Systems surged after the company acquired the digital content management solutions business of Akumina, maker of InterChange, an innovative software platform that optimizes user experiences for digital businesses using Microsoft SharePoint.  The market breadth on BSE was positive, out of 2236 stocks traded, 1066 stocks advanced, while 1050 stocks declined on the BSE. 

The BSE Sensex is currently trading at 25818.72, down by 45.75 points or 0.18% after trading in a range of 25790.94 and 25890.36. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.24%, while Small cap index was higher by 0.37%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 0.98%, Power up by 0.86%, Capital Goods up by 0.67%, FMCG up by 0.39% and PSU up by 0.37%, while IT down by 1.45%, TECK down by 1.06%, Realty down by 0.10% and Metal down by 0.02% were the top losing indices on BSE.

The top gainers on the Sensex were NTPC up by 1.89%, Coal India up by 1.63%, GAIL India up by 1.29%, Hindustan Unilever up by 1.08% and Bharti Airtel up by 1.02%. On the flip side, Infosys down by 2.74%, Vedanta down by 1.68%, Hindalco down by 1.61%, Dr. Reddys Lab down by 1.60% and TCS down by 1.00% were the top losers.

Meanwhile, Finance Minsiter Arun Jaitley has asserted that Indian economy is managing to remain in a positive side and moving ahead, despite adverse global circumstances and headwinds. He further said that economic crises earlier would leave an impact once in 10-15 years but now they are far more frequent and added that under these circumstances India has to find its own level.

Jaitley stated that India has its own agenda full in terms of reforms and investment into key areas adding that the government has opened up more sectors for investment. However, the one aspect where India is adversely affected is the country’s exports which are declining due to the global economy. He said that the headwinds are against the country.

Highlighting the positive changes, he said that the India is with the expansion of aspirational class and have a surplus human resource which is creating huge Indian diaspora around the world noting that the spread of people of Indian- origin is going to hugely increase around the world in the next 20 years.

While talking about oil prices he said that the low oil prices have created a favourable environment for the Indian economy as it helped to absorb the loss faced by oil companies and kept inflation under control and also enabled the government to rationalize subsidies. Further while stating the reason for the investment in the country Jaitley said that the environment for investment is more conducive now because the decision making is quicker, infrastructural investments are picking up and Indian economy is growing faster than most other economies in the world.

However, Jaitley stated that the world economy is under great stress with almost every forecast indicating a negative trend in terms of growth statistics. He outlined three key challenges facing India's economic growth which includes the global slowdown impacts the world market, which in turn poses challenges for large economies like India. Second, 55 percent of the population is still dependent on agriculture and with the unpredictability of monsoons, their purchasing power has been reduced significantly and the third, while public and foreign investment in India has grown by 30 percent and 40 percent respectively, the rate of growth in terms of private investments is still sluggish. In order to address these challenges, Jaitley highlighted the structural changes brought about by the Indian government on the back of country's consistent drive for growth.

The CNX Nifty is currently trading at 7826.95, down by 10.60 points or 0.14% after trading in a range of 7813.10 and 7843.40. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Asian Paints up by 2.02%, NTPC up by 1.97%, Coal India up by 1.72%, GAIL India up by 1.36% and Bharti Airtel up by 1.21%. On the flip side, Infosys down by 2.68%, HCL Tech. down by 2.13%, Dr. Reddys Lab down by 1.74%, Hindalco down by 1.61% and Vedanta down by 1.58% were the top losers.

Asian markets were trading mostly in green; KOSPI Index was up by 0.07%, Shanghai Composite up by 0.17%, Jakarta Composite up by 0.33%, Hang Seng up by 0.1% and Nikkei 225 was up by 0.25%.On the other hand, Taiwan Weighted was down by 0.81% and FTSE Bursa Malaysia KLCI was down by 0.07%.