Markets trade flat with negative bias in early noon session

Indian equity benchmarks erased early gains and were trading flat with negative bias in early noon session, on account of selling in the front line blue chip counters. Selling pressure in metal and banking stocks dragged the market lower. Cautiousness also prevailed in the markets ahead of Index of Industrial Production data for January due to be unveiled later today. Sentiment was weighed down on report that Ratings agency Crisil said that there are no signs of Indian economy sharply rebounding in the next financial year as the fiscal policy remains restrictive. It said leverage and non-performing assets (NPAs) of banks will remain a challenge in financial year 2016-17. However, realty stocks were trading higher after Rajya Sabha passed the real estate Bill providing the much needed relief to home buyers.

On the global front, Asian markets were trading mostly in green, on track for weekly gains, shrugging off global losses logged after the European Central Bank eased aggressively but suggested it was running out of room to cut interest rates even if other stimulus options remained. Back home, in scrip specific development, shares of Skipper were trading higher after the company bagged two orders worth Rs 120 crore from the Power Grid Corporation. ANG Industries was trading higher higher after the company received order for 1,500 Reversed Vending Machines which will be used in collecting waste plastics and P.E.T Bottles and reduced the volume to 5 per cent of the total volume of the bottles and make it easy to collect waste water, cold drinks and juices empty bottles. The total value of the order is Rs 22.5 crore to be executed in next 15 months by the company. 

The BSE Sensex is currently trading at 24617.22, down by 6.12 points or 0.02% after trading in a range of 24572.02 and 24817.80. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.23%, while Small cap index down by 0.32%.

The top gaining sectoral indices on the BSE were FMCG up by 0.53%, IT up by 0.34%, Oil & Gas up by 0.27%, Realty up by 0.26% and TECK up by 0.24%, while Metal down by 1.06%, Bankex down by 0.66%, PSU down by 0.54%, Power down by 0.50% and Consumer Durables down by 0.36% were the losing indices on BSE.

The top gainers on the Sensex were Adani Ports &Special up by 1.44%, TCS up by 1.14%, ITC up by 0.79%, Asian Paints up by 0.41% and Dr. Reddys Lab up by 0.36%. On the flip side, Tata Steel down by 1.71%, BHEL down by 1.25%, Sun Pharma Inds. down by 1.20%, ONGC down by 1.14% and NTPC down by 0.71% were the top losers.

Meanwhile, bringing big cheers to the home buyers, the Rajya Sabha has approved the landmark Real Estate Bill with a promise to secure the interests of homebuyers and developers in equal measure and remove corruption and inefficiency from the sector. The bill, which seeks to regulate the property sector, bring in transparency is slated to be taken up by Lok Sabha on March 14. The Real Estate (Regulation and Development) Bill, 2016 would become law after it gets the assent of the Lok Sabha.

Once the Real estate Bill becomes law, real estate developers will require to deposit 70% of the funds received from buyers for a project into an escrow account (a financial instrument held by a third party on behalf of the other two parties in a transaction), so that funds can’t be diverted to other projects and it can be utilised for land cost and construction of the related project. It, therefore, provides greater certainty to buyers that the money they pay to the developer will be utilised for development of the project where they have bought houses. The amended Bill also provides for imprisonment up to three years if the builders violate the provisions, including delayed deliveries.

Developers will have to register projects with 500 sq mt area or 8 flats with a regulatory authority instead of 1,000 sq mt and 12 flats earlier. A minimum of 50% of sale proceeds will have to be kept in a separate bank account and used for construction of that project. Among other changes, the carpet area has now been defined as the net usable area and all financial statements have to be audited within six months of financial year closure by a practicing chartered accountant.

The Bill, which has been pending since 2013, was amended by the Cabinet in December 2015. The Bill was approved with amendments as mooted by the Rajya Sabha select committee. The new law would create the framework for regulating transactions between buyers and promoters of real estate projects. It has also a provision to establish state level regulatory authorities called Real Estate Regulatory Authorities (RERAs). Real estate contributes nine per cent to the national GDP and the Bill’s passage was seen as crucial to ensuring better regulatory oversight and orderly growth in the industry.

The CNX Nifty is currently trading at 7476.05, down by 10.10 points or 0.13% after trading in a range of 7464.70 and 7543.95. There were 18 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were Adani Ports &Special up by 1.52%, Bosch up by 1.24%, TCS up by 1.12%, Cairn India up by 1.07% and BPCL up by 1.05%. On the flip side, Vedanta down by 2.21%, Kotak Mahindra Bank down by 1.89%, Tata Steel down by 1.75%, Hindalco down by 1.67% and Tech Mahindra down by 1.64% were the top losers.

Asian markets were trading mostly in green; KOSPI Index increased 2.08 points or 0.11% to 1,971.41, FTSE Bursa Malaysia KLCI increased 3.54 points or 0.21% to 1,694.45, Taiwan Weighted increased 45.44 points or 0.52% to 8,706.14, Nikkei 225 increased 75.68 points or 0.45% to 16,928.03 and Hang Seng increased 112.75 points or 0.56% to 20,097.17, while Shanghai Composite decreased 4.9 points or 0.17% to 2,799.82 and Jakarta Composite decreased 4.61 points or 0.1% to 4,788.59.