Benchmarks trim losses; trade continues in red

Recovering from day’s low, benchmark equity indices have gained momentum however were still trading below the neutral line on sustained capital outflows by foreign funds and selling by retail investors on muted corporate earnings. Sentiments remained down-beat on report that India’s Services exports fell by 3.8 per cent year-on-year to $ 12.01 billion in November 2015. Besides, weak trade in other Asian markets on worries about tumbling oil prices and the slowing Chinese economy, also weighed on the domestic sentiments. However, investors got some comfort with report that Indian business leaders have emerged as the most optimistic lot globally about economic recovery in 2016, largely owing to a pro-reforms government, recent policy announcements and regulatory changes. Furthermore, keeping hopes alive for an 8 per cent growth rate this fiscal, NITI Aayog Vice-Chairman Arvind Panagariya has said GDP figures will get revised and there will be a surprise in the fourth quarter.

On the global front, Asian shares declined on Monday, following another dismal day on Wall Street, as investors looked ahead to Chinese economic growth figures. Furthermore, Oil prices sank further below $28 on Monday morning, on fears that the lifting of sanctions on Iran will push more supply onto a global market already grappling with overcapacity.  Back home, stocks from Metal, IT and Teck counters were supporting the markets’ uptrend, while those from Capital Goods, Realty and Auto counters were adding to the underlying cautious undertone. In scrip specific development, shares of Oberoi Realty have surged after the company reported 164% year-on-year (YoY) jump in consolidated net profit at Rs 209 crore for the quarter ended December 2015 driven by robust sales. On the other hand, Pipavav Defence has declined after the company’s net loss in the quarter ended on December 31 widened to Rs 293.60 crore due to sharp decline in the income from operations.

The market breadth on BSE was positive, out of 2377 stocks traded, 303 stocks advanced, while 1994 stocks declined on the BSE. 

The BSE Sensex is currently trading at 24444.94, down by 10.10 points or 0.04% after trading in a range of 24285.23 and 24524.85. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 1.24%, while Small cap index down by 2.75%.

The top gaining sectoral indices on the BSE were Metal up by 1.38%, IT up by 0.36%, TECK up by 0.11% and Bankex up by 0.01%, while Capital Goods down by 1.81%, Realty down by 1.40%, Auto down by 1.13%, Consumer Durables down by 1.06% and Oil & Gas down by 0.60% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 3.76%, GAIL India up by 2.41%, Axis Bank up by 1.28%, Lupin up by 1.14% and ITC up by 0.91%. On the flip side, Bajaj Auto down by 2.47%, ONGC down by 2.44%, Cipla down by 1.84%, Larsen & Toubro down by 1.54% and Hero MotoCorp down by 1.52% were the top losers.

Meanwhile, Oil Marketing Companies (OMCs), have slashed prices of petrol and diesel for the fourth time in a row, on the back of a softening global oil market. Petrol and diesel prices were cut by 32 paise and 85 paise respectively, by oil marketing companies to pass on part of the benefit of falling global crude oil prices to consumer. The new rates announced are effective midnight January 15 /January 16. Post the revision, the price of petrol in Delhi is Rs 59.03 per litre as against Rs 59.35 currently, whereas a litre of diesel will cost Rs 44.18 as against Rs 45.03.

At the last revision, State run fuel retailers have slashed price of petrol and diesel by 63 paise a litre and Rs 1.06/ litre respectively. The near 18% fall in the price of the Indian crude basket in first fortnight of January warranted a steeper cut in the retail price of both fuels. But, a simultaneous raising of excise duty by the government, the eighth time since November 2014-limited the ability of oil marketing companies to pass on the full benefit of cheaper oil to consumers.

Meanwhile, the government had hiked excise duty on petrol and diesel, to mop up over by Rs 3,700 crore in additional revenue. The duty on petrol has been raised by 75 paise per litre, while that on diesel is up by Rs 2 per litre. The excise duty hike, second this month, would net the government an additional Rs 3,700 crore during the remainder of the fiscal year ending March 31.

After including additional and special excise duty, the total levy on unbranded petrol will be Rs 20.48 per litre, as against Rs 19.73 currently. Similarly, on unbranded or normal diesel, total excise duty after including special excise will be Rs 15.66 per litre compared with the Rs 13.83 now. The basic excise duty on unbranded or normal petrol has been increased to Rs 8.48 as against Rs 7.73 per litre and the same on unbranded diesel to Rs 9.83 per litre as against Rs 7.83. The basic excise duty on branded petrol has been raised from Rs 8.91 per litre to Rs 9.66 and the same on branded diesel from Rs 10.19 to Rs 12.19 per litre.

The CNX Nifty is currently trading at 7434.75, down by 3.05 points or 0.04% after trading in a range of 7383.35 and 7463.65. There were 22 stocks advancing against 28 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 4.05%, GAIL India up by 2.52%, Bank of Baroda up by 2.30%, Hindalco up by 1.74% and Vedanta up by 1.65%. On the flip side, Cairn India down by 3.68%, Zee Entertainment down by 3.08%, ONGC down by 2.26%, Bajaj Auto down by 1.96% and Cipla down by 1.85% were the top losers.

Asian markets were trading in red, Nikkei 225 was down by 1.67%, Hang Seng down by 1.12%, Taiwan Weighted down by 0.63%, Jakarta Composite down by 0.83%, Shanghai Composite down by 0.42%, FTSE Bursa Malaysia KLCI down by 0.42% and KOSPI Index was down by 0.05%.