Benchmarks pare initial gains; trade marginally in green in noon deals

Indian equity benchmarks have pared most of their initial gains to trade marginally in green in noon deals as investors’ opted to offload their positions in risky assets at higher levels. Some support came with international rating agency Fitch maintaining India's growth forecast at 7.5 percent for the financial year 2015-16 and projecting the GDP growth of 7.7 per cent in the FY2017, which is 0.3 per cent lower than its December forecast of 8 per cent. Meanwhile, Finance Minister Arun Jaitley has withdrawn proposal of tax on Employees’ Provident Fund, but retained tax proposal for NPS. In his budget proposal, Jaitley had proposed that 40 per cent of the EPF withdrawals would be tax exempt and the remaining 60 per cent would also get the same treatment provided the amount is invested in pension annuity schemes.

On the global front, most of the Asian equity indices were trading in red at this point of time as sentiments remained dampened after Chinese authorities warned about the risk of leverage in the country’s housing market. Chongqing mayor Huang Qifan said that China could be headed for a financial disaster if local governments are allowed to keep encouraging home buying with measures such as reducing down payment requirements.

Back home, metal stocks are gaining for the eight straight day on the back of surge in the base metal prices. Sugar stocks too remained on buyers’ radar on prospects of sugar price hike in local markets following global trends and the possibility of export incentives by the government of Maharashtra to move surplus stock out of the country. However, banks have taken a hit in today’s session on account of profit booking at higher and attractive levels. The broader indices too were trading in-line with benchmarks, while the market breadth on the BSE was positive; there were 1,397 shares on the gaining side against 990 shares on the losing side while 123 shares remain unchanged.

The BSE Sensex is currently trading at 24666.79, up by 20.31 points or 0.08% after trading in a range of 24629.23 and 24793.62. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.20%, while Small cap index up by 0.60%.

The top gaining sectoral indices on the BSE were Metal up by 2.58%, Oil & Gas up by 2.07%, Energy up by 1.84%, Realty up by 1.71% and Basic Materials up by 1.67%, while Bankex down by 0.95%, IT down by 0.72%, TECK down by 0.53% and Finance down by 0.32% were the few losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 2.36%, Adani Ports &Special up by 2.33%, GAIL India up by 2.10%, Lupin up by 1.94% and Reliance Industries up by 1.86%. On the flip side, Hindustan Unilever down by 2.60%, Maruti Suzuki down by 2.27%, SBI down by 2.10%, ICICI Bank down by 1.11% and Infosys down by 0.99% were the top losers.

Meanwhile, concerned over continuous decline in exports, a committee of top officials including from commerce and shipping ministries will meet tomorrow to discuss ways to fast-track clearance processes and improve ease of doing business to boost shipments. The meeting will be chaired by Commerce Secretary Rita Teaotia

The committee to facilitate trading across borders and fast tracking of export import clearances was constituted last month by the Prime Minister's Office. Its other members include Central Board of Excise and Customs chairman, Director General of Foreign Trade, representative of Railway Board, shipping and Airport Authority of India.

Further, the committee in the meeting would deliberate on facilitating implementation of measures for fast tracking the regime for export and import clearances besides other trade facilitation steps. Fast tracking clearance procedures promotes ease of doing business for traders which in turn help reducing transactions cost for exporters and importers both. Besides, it will work on ways to speed up the progress of e-trade and its various components like creating paperless and contact free approval environment for export and import clearances.

India’s merchandise exports extending its decline for the fourteen months in row, plunged by 13.6 per cent in January 2016 at $21.07 billion as against $24.39 billion in January last year. The last time Indian exports registered a positive growth was in November 2014, when shipments had expanded at a rate of 7.27 percent.

The CNX Nifty is currently trading at 7492.20, up by 6.85 points or 0.09% after trading in a range of 7482.65 and 7527.15. There were 31 stocks advancing against 18 stocks declining on the index.

The top gainers on Nifty were Cairn India up by 7.45%, Vedanta up by 4.98%, Hindalco up by 4.91%, Adani Ports & Special up by 2.49% and Tata Steel up by 2.37%. On the flip side, Bank of Baroda down by 3.19%, Hindustan Unilever down by 2.67%, SBI down by 2.12%, Maruti Suzuki down by 2.05% and HCL Tech. down by 1.58% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 131.57 points or 0.65% to 20,028.15, Nikkei 225 dropped 128.17 points or 0.76% to 16,783.15, Jakarta Composite shed 26.22 points or 0.54% to 4,805.36, Shanghai Composite slipped 13.97 points or 0.48% to 2,883.37, KOSPI Index fell 11.75 points or 0.6% to 1,946.12 and FTSE Bursa Malaysia KLCI was down by 5.92 points or 0.35% to 1,692.01. On the flip side, Taiwan Weighted was up by 4.76 points or 0.05% to 8,664.31.