Benchmarks continue weak trade; Power, Realty drag

Indian equity benchmarks continued their weak trade in the late afternoon session on account of selling in front line blue chip counters. The sentiments were under pressure on report that United Nations has downgraded its GDP growth forecast for India for 2016 to 7.5% from 8.2% estimated earlier, largely due to slow progress in implementing reform policies. However, Finance Ministry statements that it will stick to its fiscal consolidation roadmap without compromising on development spending and expenditure budgeted for the current fiscal, arrested some downside fall. Traders were seen piling position in IT, Oil & Gas and TECK stocks while selling was witnessed in Power, Realty and PSU sector stocks.  In scrip specific development, Motherson Sumi Systems was trading in red after reports surfaced which suggested that multiple sites of French car maker- Renault, which is a client of Motherson Sumi Systems, have been raided by the French anti-fraud units.

On the global front, the Asian markets were trading mostly in red while the European markets were trading on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading below the psychological 7,550 and 24,800 levels respectively. The market breadth on BSE was negative in the ratio of 774:1712 while 167 scrips remained unchanged.

The BSE Sensex is currently trading at 24703.99, down by 68.98 points or 0.28% after trading in a range of 24656.76 and 24912.64. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.61%, while Small cap index down by 0.87%.

The gaining sectoral indices on the BSE were IT up by 0.78%, Oil & Gas up by 0.71% and TECK up by 0.44%, while Power down by 1.46%, Realty down by 1.14%, PSU down by 1.08%, Capital Goods down by 0.93% and FMCG down by 0.89% were the losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 2.38%, Infosys up by 2.02%, Maruti Suzuki up by 1.20%, Dr. Reddy’s Lab up by 1.07% and HDFC Bank up by 0.14%.

On the flip side, GAIL India down by 3.20%, NTPC down by 3.18%, ICICI Bank down by 2.25%, SBI down by 2.20% and BHEL down by 2.05% were the top losers.

Meanwhile, in order to address concerns over the entry of sub standard items and to simplify the process by setting shelf-life norms and relaxing the labeling guidelines, India’s food regulator Food Safety and Standards Authority of India (FSSAI) has issued new rules for importing products. These regulations may be called as Food Safety and Standards (Import) Regulations, 2016.

The regulator addressed two key issues raised by the food industry by easing labelling requirements and introducing a redressal procedure. According to the authority, the new regulations - except the packaging and labelling requirements and will also apply to export consignments from India that are rejected by foreign countries and returned.

As per the new norms, the companies must register with the Directorate General of Foreign Trade and possess a valid import-export code, apart from an FBO licence to import food. Besides, it has allowed the importers to affix a single, non-detachable sticker to rectify labelling errors related to the name and address of the importer, the FSSAI logo and licence number and the symbols for nonvegetarian and vegetarian food items. The earlier rules didn't allow such errors to be corrected. 

Further, no person shall import any food without an import license from the Central Licensing Authority in accordance with the procedure laid down in the Food Safety and Standards (Licensing and Registration of Food Businesses) Regulations, 2011. No food article will be allowed unless it has 60% of its shelf life remaining when it is cleared from customs, according to the new rules.

The CNX Nifty is currently trading at 7516.70, down by 20.10 points or 0.27% after trading in a range of 7502.80 and 7566.50. There were 13 stocks advancing against 37 stocks declining on the index.

The top gainers on Nifty were BPCL up by 3.41%, Reliance Industries up by 2.36%, Tech Mahindra up by 2.29%, Infosys up by 1.64% and IndusInd Bank up by 1.41%.

On the flip side, NTPC down by 3.35%, GAIL India down by 3.16%, SBI down by 2.42%, ICICI Bank down by 2.42% and Idea Cellular down by 2.35% were the top losers.

The Asian markets were trading mostly in red; Hang Seng decreased 296.64 points or 1.5% to 19,520.77, Shanghai Composite decreased 106.68 points or 3.55% to 2,900.97, Nikkei 225 decreased 93.84 points or 0.54% to 17,147.11, KOSPI Index decreased 21.14 points or 1.11% to 1,878.87 and FTSE Bursa Malaysia KLCI decreased 1.22 points or 0.07% to 1,632.22.

On the other hand, Jakarta Composite increased 11.5 points or 0.25% to 4,524.68 and Taiwan Weighted increased 19.13 points or 0.25% to 7,762.01.

The European markets were trading in red; UK’s FTSE 100 decreased 5.25 points or 0.09% to 5,912.98, France’s CAC decreased 17.86 points or 0.41% to 4,295.03 and Germany’s DAX decreased 16.76 points or 0.17% to 9,777.44.