Markets trade lower in early deals; Nifty breaches 7,200 mark

Prolonging their southward journey for fourth day in a row, markets are reeling under pressures in early deals on Thursday with frontline gauges tumbling below their crucial 23,600 (Sensex) and 7,200 (Nifty) levels. Meanwhile, the session was proving equally weak for broader indices. Weakness in other Asian markets too weighed the sentiment , though US Federal Reserve chair Janet Yellen in a testimony to Congress stated that global economic turmoil and massive sell-off in global equity markets could spook the US economy, rekindling hopes of a delay in interest rate raise. Further, traders also remained concerned on private report that India continues to report over 7 per cent GDP growth, but its momentum has weakened and the country's growth is well 'below trend. The sentiments were further weighed down by Indian rupee depreciating by 9 paise to 67.94 against the American currency today on account of persistent dollars selling by banks and exporters. 

In the scrip specific development, Dr Reddys Laboratories was trading higher by 3% on the National Stock Exchange (NSE) after the Company announced share buyback plan.

On the global front, the US markets gave up early gains to end mixed overnight following three straight sessions of losses.  Asian markets were trading lower after the U.S. Federal Reserve Chair Janet Yellen's dovish comments failed to bolster investor sentiment and as crude oil prices remained volatile.

Back home, all the sectoral indices on the BSE were trading in red led by Capital Goods, FMCG, Oil & Gas and Metal. The market breadth on BSE was negative in the ratio of 524: 1001 while 90 scrips remained unchanged.

The BSE Sensex is currently trading at 23583.37, down by 175.53 points or 0.74% after trading in a range of 23582.17 and 23758.46. There were 6 stocks advancing against 24 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.60%, while Small cap index was down by 0.68%.

The top losing sectoral indices on the BSE were Capital Goods down by 0.80%, FMCG down by 0.79%, Oil & Gas down by 0.74%, Metal down by 0.73% and Realty down by 0.67%, while there were no losers.

The top gainers on the Sensex were Dr. Reddys Lab up by 2.58%, SBI up by 1.92%, Tata Motors up by 1.40%, GAIL India up by 1.01% and Bharti Airtel up by 0.60%. On the flip side, BHEL down by 2.38%, Cipla down by 2.11%, Tata Steel down by 1.38%, ICICI Bank down by 1.38% and ITC down by 1.36% were the top losers.

Meanwhile, Indian gas based power sector is likely to get a major boost with Australia willing to look at a regulatory framework for facilitating supply of gas at lower prices for India’s gas-fired power stations, which may hold the key to the success of the government's 100 GW (giga watt) solar dream envisaging round-the-clock clean and affordable power to all.Australian resources and energy minister Josh Frydenberg said while the government could not determine the price, a regulatory framework could be worked out to facilitate lower rates through “vertical integration” with power plants. Earlier, Power, Coal and Renewable Energy Minister Piyush Goyal had proposed for adopting a new paradigm for pricing gas in accordance with the changed dynamics of the global hydrocarbons market, devastated by sustained oversupply and crashing price as well as demand.

The ministers agreed to set up five working groups that would focus on taking the dialogue forward.  These would be in the areas of coal mining and clean coal technologies, LNG, including re-gasification technology, renewable energy, coal bed methane, and underground coal gasification, and smart grids and grid integration technology.Goyal said that 'I can see energy becoming the most important and defining part of our engagement with Australia in the days to come.'

Meanwhile, India and Australia agreed on enhancing cooperation in clean coal technology, renewable power and LNG in a bid to meet the burgeoning demand for cheap and environment-friendly energy. The two countries also talked about Free Trade Area (FTA), Adani Group's investment in Australia and the ties that the countries share at various levels.

The CNX Nifty is currently trading at 7165.40, down by 50.30 points or 0.70% after trading in a range of 7162.80 and 7208.65. There were 10 stocks advancing against 40 stocks declining on the index.

The top gainers on Nifty were Dr. Reddys Lab up by 2.60%, SBI up by 2.04%, Tata Motors up by 1.42%, Bank Of Baroda up by 1.20% and GAIL India up by 1.07%. On the flip side, BHEL down by 2.34%, Cipla down by 1.99%, ACC down by 1.91%, Ambuja Cement down by 1.89% and Zee Entertainment down by 1.83% were the top losers.

Asian markets were trading in red, Jakarta Composite increased 37.9 points or 0.8% to 4,770.38, Hang Seng decreased 785.34 points or 4.07% to 18,502.83, KOSPI Index decreased 53.38 points or 2.78% to 1,864.41 and FTSE Bursa Malaysia KLCI decreased 3.06 points or 0.19% to 1,641.35.