Benchmarks continue to trade in red in late morning session

Indian bourses continued to trade in red in the late morning session as fund and retail investors engaged in reducing positions amid a weak trend in global markets. Sentiments came under pressure after government has exceeded fiscal deficit target for the current financial year at the end of February but the final numbers for 2015-16 will be known once the March data is released.  Further, market participants turned jittery over the report that indicates the new fiscal (FY17) is likely to remain challenging for corporate India, and corporates are unlikely to take up new investments on weaker credit conditions than in 2015-16. The report also believes the aggregate EBITDA levels of corporates will grow only modestly during 2016-17, given the budgetary focus on consolidation of fiscal deficit. At present, Sensex and Nifty were trading below the crucial 25,300 and 7,750 levels respectively, with cut of over 0.3%. The broader markets, however, were outperforming their larger peers with BSE Midcap and Smallcap indices up over between 0.2- 0.6%. Investors got some comfort after Infrastructure sector growth bounced back to a 15-month high in February, raising hopes of a pickup in industrial activity after three months of negative growth. The Index of Eight Core Industries, widely called the core sector index, was up 5.7% in Februrary compared with 2.9% in the previous month and was the highest since 8.5% recorded in November 2014.

On the global front, Asian markets were trading lower with Japanese shares declining the most as the yen resumed gain and the Japanese 'tankan' manufacturing confidence index came in worse than expected. However, there were some gains in metals after a gauge of Chinese manufacturing expanded for the first time since July. Meanwhile, US stocks ended lower on profit taking after gains in the previous session and caution ahead of non-farm payrolls data on Friday. Back home, stocks from Realty, Capital Goods and Power counters were supporting the markets’ uptrend, while those from Oil & Gas, Metal and Auto counters were adding to the underlying cautious undertone. 

In scrip specific development, shares of Alkem Laboratories have declined after observations made by the UK health regulator, UK-Medicines and Healthcare Products Regulatory Agency following an inspection at the company's bioequivalence facility located at Taloja, Maharashtra in March 2016. Furthermore, diesel car makers such as Tata Motors and M&M came under pressure after the court extended the ban on registration of diesel vehicles with engine capacity of 2000cc and more in the National Capital Region till further orders. On the other hand, shares of Jaypee Group companies such as Jaiprakash (JP) Associates, Jaypee Infratech and Jaiprakash Power Ventures rallied after UltraTech Cement has signed the definitive agreement to buy JP Associates' 21.2 million tonnes per annum (mtpa) cement capacity for Rs 15,900 crore.
 
The BSE Sensex is currently trading at 25236.19, down by 105.67 points or 0.42% after trading in a range of 25218.04 and 25354.94. There were 9 stocks advancing against 21 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.24%, while Small cap index up by 0.67%.

The gaining sectoral indices on the BSE were Realty up by 2.05%, Capital Goods up by 1.42%, Power up by 0.87%, FMCG up by 0.62%, Consumer Durables up by 0.16% while, Oil & Gas down by 0.99%, Metal down by 0.80%, Auto down by 0.70%, TECK down by 0.48%, Bankex down by 0.45% were the losing indices on BSE.

The top gainers on the Sensex were BHEL up by 5.19%, Larsen & Toubro up by 1.79%, ITC up by 1.57%, Wipro up by 0.72% and Asian Paints up by 0.66%. On the flip side, Bharti Airtel down by 2.84%, GAIL India down by 1.84%, Lupin down by 1.64%, Tata Motors down by 1.60% and Tata Steel down by 1.55% were the top losers.

Meanwhile, extending support to India, Japan has committed loans under Official Development Assistance (ODA) worth around Rs 14,251 crore (242.2 billion yen) for five infrastructure development projects in India, including the Dedicated Freight Corridor Project with loan of Rs 6,170 crore (103.6 billion yen). The loans will be extended through Japan International Cooperation Agency (JICA) which provides bilateral aid in the form of Technical Cooperation, Japanese ODA Loans and Grant Aid.

Besides, the projects it also includes Transmission System Strengthening Project in Madhya Pradesh with the loan of around Rs 911 crore (15.45 billion yen), Odisha Integrated Sanitation Improvement Project (II) with a loan of Rs 1515 crore (25.7 billion yen).  Besides, North East Road Network Connectivity Improvement Project will get Rs 3957 crore (67.1 billion yen) and Jharkhand Horticulture Intensification by Micro Drip Irrigation Project will get Rs 274 crore (4.65 billion yen).

For the financial year 2015-16, Japan committed a total of Rs 22, 984 crore (JPY 390 billion) which is the highest amount committed in a year. India and Japan have had mutually beneficial economic development cooperation since 1958. The CNX Nifty is currently trading at 7713.95, down by 24.45 points or 0.32% after trading in a range of 7699.60 and 7740.15. There were 18 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were BHEL up by 5.31%, Bank of Baroda up by 2.28%, Larsen & Toubro up by 2.00%, ITC up by 1.55% and Asian Paints up by 0.83%. On the flip side, Bharti Airtel down by 2.88%, Aurobindo Pharma down by 2.54%, BPCL down by 1.70%, Tata Motors - DVR down by 1.51% and GAIL India down by 1.50% were the top losers.

Asian markets were trading in red, Nikkei 225 was down by 3.45%, Hang Seng down by 1.27%, Taiwan Weighted down by 1.2%, Shanghai Composite down by 1.5%, KOSPI Index down by 1.22%, Jakarta Composite down by 0.21% and FTSE Bursa Malaysia KLCI down by 0.4%.