Markets trade with marginal losses in early deals

Indian equity markets have made flat and negative start, trading with marginal losses in early deals following steep losses on Wall Street Friday.  Sentiments were under pressure on report that foreign portfolio investors (FPIs) sold shares worth a net Rs 606.83 crore on February 5, 2016, as per provisional data released by the stock exchanges. Meanwhile, weakness in rupee too was weighing down the sentiments, the Indian rupee depreciating 22 paise to 67.86 against the US Dollar in early trade on Friday at the Interbank Foreign Exchange too pressured the markets. Moreover, caution prevailed in the markets ahead of GDP data, which is due to be unveiled later during day. However, shares of steel companies such as Tata Steel, JSW Steel, Steel Authority of India (SAIL) were trading higher after the government set a minimum import price for steel products to check dumping from countries such as China and South Korea. On the sectoral front, traders were seen piling up position in PSU, Banking, Capital Goods, Metal and Power, while selling was witnessed in IT, TECK, Consumer Durables, FMCG and Auto.

On the global front, the US markets ended lower on Friday after lower-than-expected jobs figures signaled a potential softening in the US economy. Most of the Asian stock markets are closed today for the Lunar New Year holiday. Japan’s Nikkei was trading 0.6% lower taking cues from the Wall Street.

In the scrip specific development, Jet Airways (India) surged 8% on the BSE after the company reported a record quarterly profit of Rs 467 crore for the third quarter ended December 31, 2015 (Q3FY16) aided by low fuel costs.

Back home, the NSE Nifty and BSE Sensex were trading above the psychological 7,450 and 24,600 levels respectively. The market breadth on BSE was positive in the ratio of 928: 558 while 60 scrips remained unchanged.

The BSE Sensex is currently trading at 24615.05, down by 1.92 points or 0.01% after trading in a range of 24572.56 and 24646.57. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.33%, while Small cap index was up by 0.46%.

The top gaining sectoral indices on the BSE were PSU up by 0.75%, Bankex up by 0.75%, Capital Goods up by 0.56%, Metal up by 0.37% and Power up by 0.23%, while IT down by 0.83%, TECK down by 0.62%, Consumer Durables down by 0.29%, FMCG down by 0.10% and Auto down by 0.05% were the losing indices on BSE.

The top gainers on the Sensex were SBI up by 2.79%, Axis Bank up by 2.14%, Adani Ports &Special up by 1.30%, Tata Steel up by 1.28% and Bharti Airtel up by 1.17%. On the flip side, Tata Motors down by 1.50%, TCS down by 1.19%, Infosys down by 1.14%, Cipla down by 0.87% and ITC down by 0.66% were the top losers.

Meanwhile, to check dumping from countries such as China and South Korea and support the ailing domestic steel producers, the government has imposed a minimum import price (MIP) ranging from $341 to $752 per tonne on 173 steel products providing relief to local steel makers hurt by an increase in cheap imports.

The Directorate General of Foreign Trade (DGFT) said in a notification that “MIP is introduced against 173 HS Codes (iron and steel products).” It also said that the floor price on steel imports will be valid for six months. However, it will not apply on imports under the advance authorisation scheme and high-grade pipes used in the petroleum and natural gas industry. The notification also said imports/shipments under the letter of credit already entered into with foreign suppliers will also be exempted from this decision.

While the duty on various steel products ranges between $341 per tonne and $752 a tonne, on ingots and billets, blooms and slabs, the MIP reads $362, $352 and $341 per tonne, respectively. On flat-rolled products of iron or non-alloy steel of a width of 600 mm or more and hot-rolled one, the minimum prices will be $445 and $500 on different items. On flat-rolled products of iron or non-alloy steel of a width of 600 mm or more and cold-rolled one, the figure stood at $560 per tonne. On products like corrugated flat-rolled products of iron/non-alloy steel, MIP ranged between $643 and $752. Further flat-rolled products of other alloy steel of a width of 600 mm or more, MIP reads between $445 and $752.

The domestic steel producers have hailed the government’s decision saying that will ensure a level-playing field to the Indian steel industry which has been adversely affected by dumped imports from various sources. On the other hand the user industry cried foul, saying it would impact prices of raw materials.

The CNX Nifty is currently trading at 7486.45, down by 2.65 points or 0.04% after trading in a range of 7473.70 and 7496.65. There were 28 stocks advancing against 22 stocks declining on the index.

The top gainers on Nifty were Bank Of Baroda up by 3.07%, SBI up by 2.94%, PNB up by 2.53%, Axis Bank up by 2.14% and Bosch up by 1.87%. On the flip side, Tata Power down by 2.24%, Tata Motors down by 1.32%, Infosys down by 1.18%, TCS down by 1.14% and Cipla down by 0.87% were the top losers.