Markets make weak start of the first day of 2016

After gaining over half a percent on the final day of 2015, the Indian equity markets have made a weak start of the first trading day of the year 2016, and are now trading with cut of around quarter a percent. The sentiments were weighted down by the report that Indian core sector growth contracted by 1.3% in November after expanding for six consecutive months, mainly dragged down by a sharp slowdown in electricity production and a contraction in cement and steel output. Besides, the Indian rupee depreciated by five paise to trade at 66.20 against the U.S. dollar today at the Interbank Foreign Exchange due to fresh buying of the American currency by banks and importers that also kept pressurizing the markets. However, the session was productive for broader indices, which outperforming larger counterparts were trading with gains in the range of 0.25-0.30%. Some support also came in on reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 1123.41 crore yesterday as per provisional data released by the stock exchanges.

In the scrip specific development, KEC International rallied 6% on the National Stock Exchange (NSE), after the company secured new orders of Rs 1,001 crore in its transmission & distribution, cables and solar business.

On the global front, the US markets ended lower on Thursday, leaving the S&P 500 marginally lower for a year marked by record highs as well as a major selloff. Most Asian markets are closed today on account of the New Year holiday.

Back home, traders were seen piling up position in Auto, Oil & Gas, Realty, PSU and Power, while selling was witnessed in Metal, Bankex, TECK, IT and Consumer Durables. The market breadth on BSE was positive in the ratio of 1244: 539 while 73 scrips remained unchanged.

The BSE Sensex is currently trading at 26052.24, down by 65.30 points or 0.25% after trading in a range of 26008.20 and 26111.51. There were 9 stocks advancing against 21 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.27%, while Small cap index gained 0.26%.

The top gaining sectoral indices on the BSE were Auto up by 0.25%, Oil & Gas up by 0.20%, Realty up by 0.06%, PSU up by 0.04% and Power up by 0.01%, while Metal down by 0.37%, Bankex down by 0.30%, TECK down by 0.14%, IT down by 0.13% and Consumer Durables down by 0.07% were the losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 1.58%, Adani Ports &Special up by 0.50%, Lupin up by 0.42%, SBI up by 0.40% and GAIL India up by 0.23%. On the flip side, Tata Steel down by 1.41%, ONGC down by 1.24%, Sun Pharma down by 1.09%, NTPC down by 0.82% and ICICI Bank down by 0.63% were the top losers.

Meanwhile, raising some concern of the government, the external debt of the country rose 1.7% to $483.2 billion at the end of September an increase of $8.0 billion over the level at end-March 2015, due to long-term liabilities, especially commercial borrowings and non-resident Indian deposits.

Finance Ministry in its release has said the increase would have been higher than $8 billion if not for valuation gains from the appreciation of the US dollar against the rupee and most major currencies, estimated at $5.7 billion. The rise in external debt during the period was due to long-term external debt particularly commercial borrowings and NRI deposits. However, on a sequential basis, total external debt at September-end declined by $291 million from the June end. Also, excluding the valuation effect, the increase in debt would have been higher by $13.7 billion at end-September 2015 over the end-March 2015 level.

Long-term debt, which accounted for 82.2% of total external debt in September, was placed at $397.1 bn, an increase of 1.9% from March. Short-term external debt increased 0.7% to $86.1 billion. Share of commercial borrowings was highest at 37.7% of total external debt, followed by NRI deposits at 25.2% and multilateral debt at 11%. At end-September 2015, long-term external debt accounted for 82.2% of India's total external debt, while the remaining 17.8% was short-term external debt.

Sovereign external debt stood at $88.9 billion in September 2015 while non-government debt amounted to $394.3 billion, it added. The statement noted that the share of dollar denominated debt continued to be the highest in external debt stock at 57.7% at end-September 2015, followed by the rupee 28.3%, SDR 5.8%, Japanese yen 4.0%, and euro 2.4%. The ratio of short-term external debt to foreign exchange reserves was 24.6% at end-September 2015, as against 25.0% at end-March 2015.

The CNX Nifty is currently trading at 7922.05, down by 24.30 points or 0.31% after trading in a range of 7909.80 and 7939.55. There were 15 stocks advancing against 35 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 1.51%, BPCL up by 0.78%, Ultratech Cement up by 0.70%,  PNB up by 0.43% and Adani Ports &Special up by 0.42%. On the flip side, Tata Steel down by 1.79%, ONGC down by 1.22%, Sun Pharma down by 1.14%, NTPC down by 1.13% and Kotak Mahindra Bank down by 0.85% were the top losers.

Asian markets were trading in red, Jakarta Composite increased 23.65 points or 0.52% to 4,593.01, Hang Seng increased 32.25 points or 0.15% to 21,914.40 and Taiwan Weighted increased 58.07 points or 0.7% to 8,338.06. On the flip side, Shanghai Composite decreased 33.69 points or 0.94% to 3,539.18.