Markets trade with marginal losses in early deals

After making a good start, benchmarks have pared their initial gains and are now trading marginally in red in morning deals, tracking weakness in China , as the Shanghai Composite was down over 2.5%. The sentiments were under pressure with the SBI Composite Index falling below the 50 mark to 47.3 in January. Manufacturing activity in the country dipped to a one-year low, suggesting moderation in growth. Meanwhile, foreign portfolio investors (FPIs) sold shares worth a net Rs 91.15 crore on January 25, 2016, as per provisional data released by the stock exchanges that kept pressurizing the sentiment. Some cautiousness also prevailed in the markets ahead of the expiry of January derivative contracts and outcome of the US Fed meet. However, down side remained capped with statement of Standard & Poor's Rating Services that Indian economy is less vulnerable to external shocks as it is mainly driven by household consumption and government spending, and not dependent on hot money which can move out quickly. On the secrotal front, traders were seen piling up position in IT, Power, TECK, and Realty, while selling was witnessed in Capital Goods, Bankex, Oil & Gas, Metal and PSU.

In the scrip specific development, SpiceJet surged 10% on the BSE extending its gains after good earnings announcement. Also, National Building Construction Corporation (NBCC) was trading higher by 3% on the BSE after the company bagged a work order from India Trade Promotion Organization (ITPO) for re-development of Pragati Maidan in New Delhi for an estimated cost of Rs 2,149 crore.

On the global front, US markets ended higher, driven by a surge in oil prices and strong quarterly results from 3M, Johnson & Johnson and Procter & Gamble. Asian markets were trading mostly in green racking the overnight gains on Wall Street as positive economic data, strong corporate earnings and a surge in the price of crude oil lifted investor sentiment. However, the Chinese market was in negative territory.

Back home, the NSE Nifty and BSE Sensex were trading below the psychological 7,400 and 24,450 levels respectively The market breadth on BSE was positive in the ratio of 885: 684 while 93 scrips remained unchanged.

The BSE Sensex is currently trading at 24474.34, down by 11.61 points or 0.05% after trading in a range of 24467.50 and 24645.70. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.24%, while Small cap index was up by 0.12%.

The top gaining sectoral indices on the BSE were IT up by 0.41%, Power up by 0.36%, TECK up by 0.23%, and Realty up by 0.20%, while Capital Goods down by 0.62%, Bankex down by 0.61%, Oil & Gas down by 0.45%, Metal down by 0.38% and PSU down by 0.38% were the losing indices on BSE.

The top gainers on the Sensex were Sun Pharma Inds. up by 1.58%, NTPC up by 1.38%, Lupin up by 1.16%, Tata Steel up by 1.06% and Maruti Suzuki up by 0.97%. On the flip side, BHEL down by 1.89%, Bharti Airtel down by 1.70%, Adani Ports &Special down by 1.65%, Coal India down by 1.51% and GAIL India down by 1.29% were the top losers.

Meanwhile, in another shocker on economy front, the yearly SBI Composite Index fell below the 50 mark to 47.3 in January -- its lowest level in the past one year, indicating moderation in economic activity going forward. The monthly index also decreased marginally from 52.7 in December 2015 to 52.4 in January 2016. SBI Composite Index reading from 52 to 55 translates into an Index Value that indicates moderate growth. Though, according to the report, one of the reasons for the loss of momentum in SBI composite index is the base effect.

The report assessed that construction, steel, and textile are some of the sectors that are facing clear headwinds and thus need to be addressed head-on. The report observed that 42 per cent of the tenders floated during the last 12 months are yet to be awarded in construction sector. It also said that construction activity in real estate segment was low in January, with players focused on stabilising their finances and adjusting to the new market situation, and called for 'a concerted and faster execution going forward in the construction sector'.

Regarding the textile sector, the report said the government should think afresh to skew its existing TUF (Technology Upgradation Fund) allocation in favour of technical textiles to promote exports and bolster the Make in India campaign. For steel, it pointed that about 150 units at Mandi Gobindgarh in Punjab, have faced closure in the last two years and the steel sector is not looking good as of now.

The report further said that in the infrastructure segment, the government supported projects are keeping demand up, but the significant delays in implementation remained concern and one of the several steps the government can take is to push for ‘Eastern Dedicated Freight Corridor’ to alleviate some macro issues relating to nearness to markets and ports for exports.

The CNX Nifty is currently trading at 7425.65, down by 10.50 points or 0.14% after trading in a range of 7423.65 and 7476.05. There were 18 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were Sun Pharma Inds. up by 1.70%, Power Grid Corpn. up by 1.69%, NTPC up by 1.38%, Lupin up by 1.23% and Maruti Suzuki up by 1.17%. On the flip side, Bank Of Baroda down by 1.97%, BHEL down by 1.79%, Cairn India down by 1.77%, Coal India down by 1.74% and Bharti Airtel down by 1.68% were the top losers.

Asian markets were trading mostly in green, FTSE Bursa Malaysia KLCI increased 5.97 points or 0.37% to 1,632.63, KOSPI Index increased 13.45 points or 0.72% to 1,885.14, Taiwan Weighted increased 25.13 points or 0.32% to 7,853.80, Jakarta Composite increased 29.75 points or 0.66% to 4,540.22, Hang Seng increased 138.36 points or 0.73% to 18,999.16 and Nikkei 225 increased 427.33 points or 2.56% to 17,136.23

On the flip side, Shanghai Composite decreased 77.33 points or 2.81% to 2,672.45.