Benchmarks continue weak trade in late afternoon session

Indian equity benchmarks trimmed losses and continued its weak trade in the late afternoon session on account of selling in front line blue chip counters. The sentiments were under pressure on reports of persistent foreign fund outflows. Foreign portfolio investors sold shares worth Rs 1,324.69 crore yesterday, as per provisional data. India’s current account deficit may narrow to 0.5% of GDP in 2016 from 0.7% in 2015 owing to lower commodity prices, particularly oil, arrested some downside selling pressure. Traders were seen piling position in Bankex, IT and TECK stocks while selling was witnessed in Auto, Oil & Gas and FMCG sector stocks. In scrip specific development, Natco Pharma was trading firm after it signed a non-exclusive licensing agreement with the Medicines Patent Pool (MPP) and Bristol-Myers Squibb to manufacture and sell generic versions of Daclatasvir, used for the treatment of chronic hepatitis C. Axis Bank was trading firm on reporting a 15% year-on-year (yoy) jump in net profit at Rs 2,175 crore in the October-December quarter (Q3FY16) on the back of higher net interest income and other income.

On the global front, the Asian markets were trading in red while the European markets were trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading below the psychological 7,350 and 24,100 levels respectively. The market breadth on BSE was positive in the ratio of 1398:1075 while 155 scrips remained unchanged.

The BSE Sensex is currently trading at 24027.47, down by 34.57 points or 0.14% after trading in a range of 23862.00 and 24351.83. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.06%, while Small cap index up by 0.66%.

The gaining sectoral indices on the BSE were Bankex up by 1.26%, IT up by 0.61%, TECK up by 0.46%, Realty up by 0.13%, Consumer Durables up by 0.12% while, Auto down by 1.40%, Oil & Gas down by 0.85%, FMCG down by 0.72%, Capital Goods down by 0.38%, Metal down by 0.28% were the losing indices on BSE.

The top gainers on the Sensex were Axis Bank up by 4.40%, ICICI Bank up by 1.85%, Wipro up by 1.61%, NTPC up by 1.36% and BHEL up by 1.33%.

On the flip side, Tata Motors down by 3.46%, Maruti Suzuki down by 3.32%, Dr. Reddy’s Lab down by 2.80%, ONGC down by 1.92% and Hindustan Unilever down by 1.69% were the top losers.

Meanwhile, in order to get support for certain projects under National Highway Development Project (NHDP), the road transport and highways ministry is seeking a soft loan of Rs 13,000 crore from multilateral agencies for its highway projects. It has approached Japanese International Cooperation Agency (JICA) for a long-term untied loan of Rs 6,000 crore to part fund its NHDP and the remaining amount has been sought from Asian Development Bank (ADB) which will be used for special projects. A soft loan from JICA means the roads ministry can get funds at 0.5% interest rate for a period of over 25 years.

Further, the government is in talks with ADB for Rs 24,000 crore bridge connecting India with Sri Lanka. However, the discussion is still at a primary stage. However, JICA is already funding projects of the Delhi Metro Rail Corporation and is also providing loans for the dedicated western freight corridor project of the railways as part of the special terms of economic partnership.

Moreover, the ministry could be mulling a loan agreement with state owned Life Insurance Corporation of India (LIC). India aims to increase the length of its highways by 50,000 km over the next five years, from 96,000 km now. The plan will require an investment of Rs 5 lakh crore. Recently, in a meeting with Finance Minister Arun Jaitley, Road Transport and Highways Minister Nitin Gadkari had sought a budgetary allocation of Rs 85,000 crore for 2016-17.

The CNX Nifty is currently trading at 7305.15, down by 4.15 points or 0.06% after trading in a range of 7250.00 and 7398.70. There were 27 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were Axis Bank up by 4.54%, Ultratech Cement up by 3.49%, Ambuja Cement up by 3.26%, PNB up by 2.92% and Bank of Baroda up by 2.81%.

On the flip side, Tata Motors down by 3.54%, Maruti Suzuki down by 3.13%, Dr. Reddy’s Lab down by 2.80%, Idea Cellular down by 2.30% and ONGC down by 1.97% were the top losers.

The Asian markets were trading in red; Nikkei 225 decreased 398.93 points or 2.43% to 16,017.26, Hang Seng decreased 344.15 points or 1.82% to 18,542.15, Shanghai Composite decreased 96.21 points or 3.23% to 2,880.48, Taiwan Weighted decreased 35.11 points or 0.46% to 7,664.01, Jakarta Composite decreased 18.61 points or 0.42% to 4,409.37, FTSE Bursa Malaysia KLCI decreased 12.67 points or 0.78% to 1,606.16 and KOSPI Index decreased 4.92 points or 0.27% to 1,840.53.

The European markets were trading in green; UK’s FTSE 100 increased 56.63 points or 1% to 5,730.21, France’s CAC increased 41.27 points or 1% to 4,166.22 and Germany’s DAX increased 86.85 points or 0.92% to 9,478.49.