Benchmarks trade flat with negative bias in early deals

After making a flat but positive opening, benchmarks have pared their initial gains and slipped into negative territory, tracking muted momentum in other Asian markets. Further, investors turned cautious ahead of F&O expiry for the month of December. Traders will roll over their positions in the futures & options (F&O) segment from the near month December 2015 series to January 2016 series on Thursday. However, the session was productive for broader indices, which outperforming larger counterparts were trading with gains in the range of 0.25-0.35%. Some support came in with the statement of Finance Minister Arun Jaitley that a number of sovereign and pension funds, including from Singapore, the United Arab Emirates and Russia, have evinced interest in the National Investment and Infrastructure Fund (NIIF). On the sectoral front, traders were seen piling up position in Metal, Power, Capital Goods, Realty and PSU, while selling was witnessed in Consumer Durables, FMCG and Banking.

In the scrip specific development, SKS Microfinance was trading higher on the Bombay Stock Exchange after the company completed the third securitisation transaction for a pool value of Rs 372.47 crore during FY16.

On the global front, the US markets ended higher as gains in the Technology, Healthcare and Consumer Services sectors led shares higher. Asian markets were trading mostly in red as investors turned cautious following renewed selling in recently battered crude oil futures.

Back home, the NSE Nifty and BSE Sensex were trading above the psychological 7,900 and 26,050 levels respectively. The market breadth on BSE was positive in the ratio of 1175: 679 while 138 scrips remained unchanged.

The BSE Sensex is currently trading at 26073.28, down by 6.20 points or 0.02% after trading in a range of 26072.53 and 26130.20. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.34%, while Small cap index was up by 0.29%.

The top gaining sectoral indices on the BSE were Metal up by 1.09%, Power up by 0.39%, Capital Goods up by 0.37%, Realty up by 0.36% and PSU up by 0.33%, while Consumer Durables down by 0.22%, FMCG down by 0.06% and Bankex down by 0.01% were the losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 2.39%, Bharti Airtel up by 0.94%, ONGC up by 0.90%, Dr. Reddys Lab up by 0.77% and Tata Motors up by 0.74%. On the flip side, ICICI Bank down by 0.49%, Reliance Industries down by 0.44%, Lupin down by 0.44%, Hero MotoCorp down by 0.43% and Asian Paints down by 0.38% were the top losers.

Meanwhile, ahead of the World Bank review of the growth projections of countries on January 7 or 8, World Bank chief economist Kaushik Basu has said that the Indian economy is expected to grow at 7 to 7.5 percent in 2016. Though the numbers are lower than early expected, but Kaushik Basu said that “Roughly it is in a ballpark of the kind of figure. We (World Bank) have given over 7 percent or somewhere between 7 and 7.5 percent which no matter whether the top-end of it or bottom end of it. India will still be the leader among major economies. Not only in 2015 but we expect India to lead that chart in 2016 as well”.

Every six months the World Bank takes stock of the whole global situation and puts out forecast. Until October, the World Bank retained India's growth forecast at 7.5 percent for 2015-16 and expected it to be 7.8 percent in 2016-17 and 7.9 percent in 2017-18.

Talking on impact of the rate hike by the US Fed on investment scenario in the country, Basu said that there could be some outflow of investments but the impact is minimal. Regarding exports, Basu said India needs to focus more on manufacturing-based exports as wages are rising, situation in China is on the rising path. He said that 'I think India has great potential in exports and in particular in the manufacturing sector. In manufacturing historically India has done well. The opportunity in the manufacturing sector is very high especially since wages are rising in China. But it is true that that over last 12 months if you look at the trend in exports we have not done well. He also said the ease of doing business is improving when compared to last year and the trend may contribute for higher exports in the long run.

Earlier, the World Bank chief economist Kaushik Basu had indicated that the bank may revise its GDP growth projection for India after it goes for a stock-taking in a few months. He had said that decision-making and reforms can have an impact in terms of growth rate and the fact that a couple of important decisions did not go through could have an impact.

The CNX Nifty is currently trading at 7927.95, down by 1.00 points or 0.01% after trading in a range of 7927.55 and 7944.75. There were 23 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 2.43%, Vedanta up by 1.47%, Tata Power up by 1.34%, Hindalco up by 1.30% and ONGC up by 1.08%. On the flip side, Lupin down by 0.64%, Reliance Industries down by 0.49%, Asian Paints down by 0.39%, ICICI Bank down by 0.28% and Hero MotoCorp down by 0.27% were the top losers.

Asian markets were trading mostly in red, Hang Seng decreased 97.01 points or 0.44% to 21,902.61, Taiwan Weighted decreased 25.98 points or 0.31% to 8,267.93, KOSPI Index decreased 5.59 points or 0.28% to 1,960.72 and Shanghai Composite decreased 2.6 points or 0.07% to 3,561.14.

On the flip side, Jakarta Composite increased 11.14 points or 0.24% to 4,580.50, FTSE Bursa Malaysia KLCI increased 15.31 points or 0.91% to 1,700.67 and Nikkei 225 increased 61.78 points or 0.33% to 19,044.01.