Benchmarks continue to trade flat with negative bias

Indian equity benchmarks continued to trade flat with negative bias in early noon session, Sentiments were dented with minister of State for Finance Jayant Sinha’s statement that 2016-17 would be a challenging term with headwinds from low farm sector growth, the global slowdown, and implementation of the Seventh Pay Commission report and the One Rank One Pension. However, some losses were capped with the Arvind Panagariya’s statement that buoyed by the improved second quarter GDP numbers; the Indian economy will grow over 8 per cent this fiscal. He also added that in the first half of the current fiscal, the GDP growth stood at around 7.2 per cent and is expected to cross the 8 per cent-mark in 2015-16. Meanwhile, foreign portfolio investors (FPIs) bought shares worth a net Rs 385.82 crore yesterday, as per provisional data released by the stock exchanges. Traders were seen piling up position in Capital Goods, Metal, Power, Realty and Auto stocks, while selling was witnessed in Consumer Durables, Bankex and TECK sector stocks.

On the global front, Asian markets were trading mostly in green, Asian shares climbed to 2-1/2-week highs heartened by gains on Wall Street and a recovery in crude oil prices. Back home. The market breadth was positive as 1415 stocks were advancing, while 832 were declining. In scrip specific development, share of V-Mart Retail was trading higher over 16% after the Reserve Bank of India (RBI) approved hike in investment limit by overseas investors by up to 49 per cent. Biocon was trading higher after the biotechnology firm informed stock exchanges that it has introduced an advanced novel therapy CIMIVIR-L for the treatment of Hepatitis C in India.

The BSE Sensex is currently trading at 25847.26, down by 3.04 points or 0.01% after trading in a range of 25832.98 and 25922.47. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.33%, while Small cap index gained 0.47%.

The top gaining sectoral indices on the BSE were Capital Goods up by 0.69%, Metal up by 0.59%, Power up by 0.40%, Realty up by 0.39% and Auto up by 0.39%, while Consumer Durables down by 0.52%, Bankex down by 0.25% and TECK down by 0.08% were the losing indices on BSE. 

The top gainers on the Sensex were Tata Motors up by 1.15%, Mahindra & Mahindra up by 0.65%, Cipla up by 0.65%, Coal India up by 0.56% and Lupin up by 0.55%. On the flip side, Adani Ports &Special down by 0.68%, ICICI Bank down by 0.65%, Bharti Airtel down by 0.59%, Tata Steel down by 0.55% and Maruti Suzuki down by 0.53% were the top losers.

Meanwhile, the Insolvency and Bankruptcy Code 2015 has been referred to a 30-member ‘Joint Committee of the Houses’, while 20 members of the committee are from the Lok Sabha, the rest are from the Rajya Sabha. Finance Minister Arun Jaitley moving a motion in the Lok Sabha for this purpose said that the report of this panel would be ready by the last day of the first week of the upcoming Budget session.

The Insolvency and Bankruptcy Code was introduced in the Lok Sabha and the government opined that an important legislation like ‘Insolvency and Bankruptcy Code’ where ease of doing business was involved, the Centre did not want the Bill to go to two separate committees- first Standing Committee of Parliament and then to a select committee of the Rajya Sabha. Finance Minister highlighted the increasing instance of Standing Committees’ findings being questioned in the upper house, even if they are unanimous.

However, several MPs expressed unhappiness over the Centre’s plan to directly take up the Bill for discussion and passage in lower house, without referring it to Standing committee on Finance and hence the government agreed to refer the Insolvency and Bankruptcy Code to ‘Joint Committee of the Houses’.

The Insolvency and Bankruptcy Code makes it easier for companies to wind up failed businesses and bring India on a par with developed nations in terms of resolving bankruptcy issues. The code is also expected to make it easier to do business in India. Besides, the government aims to increase investment and develop a better credit mechanism through the reform. The bill also aims to improve the average recovery level in India to at least 40 cents on the dollar from about 26 cents currently.

The CNX Nifty is currently trading at 7860.85, down by 5.10 points or 0.06% after trading in a range of 7853.80 and 7888.75. There were 31 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Cairn India up by 2.48%, Vedanta up by 2.02%, Hindalco up by 1.49%, Tata Motors up by 1.20% and Mahindra & Mahindra up by 0.75%. On the flip side, Zee Entertainment down by 1.38%, Tata Steel down by 0.78%, PNB down by 0.78%, ICICI Bank down by 0.74% and Adani Ports &Special down by 0.70% were the top losers.

Asian markets were trading mostly in green;Jakarta Composite increased 5.09 points or 0.11% to 4,522.65, Taiwan Weighted increased 9.9 points or 0.12% to 8,325.60, FTSE Bursa Malaysia KLCI increased 20.25 points or 1.23% to 1,663.51 and Hang Seng increased 97.54 points or 0.44% to 22,138.13, while Nikkei 225 decreased 103.33 points or 0.55% to 18,783.37, Shanghai Composite decreased 44.98 points or 1.24% to 3,591.11 and KOSPI Index decreased 2.81 points or 0.14% to 1,996.41.