Benchmarks pare some early losses; still continue to trade in red

Indian equity markets have recovered some of their losses but are still trading in negative terrain in late morning session. Apart from persistent profit-booking by investors in recent outperformers, a weak trend at other Asian markets ahead of US Federal Reserve's two-day policy meeting beginning later in the day pulled the indices down. Besides, depreciation in rupee values against the dollar and persistent selling by domestic financial institutions have also negatively impacted sentiments. Indian Rupee weakened by 17 paise to 66.79 against the US dollar in early trade on sustained demand for the American currency from banks and importers. However, investors got some confides with Economic Affairs Secretary Shaktikanta Das, pledging a strong focus on the execution of Budget announcements and ensuring that there are no delays in investments by key ministries, said that India plans to further liberalise rules for overseas investors as the government looks to reduce the need for approvals. Meanwhile, shares of cigarette makers such as ITC, Godfrey Philips, Golden Tobacco and VST Industries have dipped on reports that the government is working on a proposal to completely ban foreign direct investment (FDI) in the tobacco sector.

On the global front, stock markets across Asia were mostly lower on Tuesday as investors stayed cautious ahead of central-bank meetings this week in Japan and the US. Stocks in Japan were falling as the yen strengthened slightly against the U.S. dollar, while Malaysia’s benchmark stock index declined after state investment fund 1MDB said it defaulted on a $1.75 billion bond issue, which triggered cross-defaults on two other Islamic notes totaling 7.4 billion ringgit. Meanwhile, US stocks slid on Monday as weaker oil prices weighed on energy shares. Back home, majority of the sector indices were trading negative , FMCG, Consumer Durables, Banking and Capital Goods stocks witnessing selling pressure  while Metal, Realty and Power companies showing some strength.

In scrip specific development, shares of Engineers India have gained after the company formally entered into a contract with Bangladesh Petroleum Corporation (BPC) to render Project Management Consultancy (PMC) for installation of ERL Unit-2 in Chittagong, Bangladesh for $16,545,000 plus BDT 82,281,025. On the other hand, shares of ABB have declined after the company reports its order inflows during the March quarter (Q1) are 1% lower at Rs 1,830 crore than the year ago. The company received orders worth of Rs 1,856 crore in the first quarter of 2015.

The market breadth on BSE was positive, out of 2013 stocks traded, 1089 stocks advanced, while 798 stocks declined on the BSE.

The BSE Sensex is currently trading at 25620.79, down by 58.14 points or 0.23% after trading in a range of 25549.05 and 25656.70. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.16%, while Small cap index up by 0.15%.

The top gaining sectoral indices on the BSE were Metal up by 1.02%, Realty up by 0.65%, Power up by 0.21%, Oil & Gas up by 0.18% and PSU up by 0.10%, while FMCG down by 0.45%, Consumer Durables down by 0.43%, Bankex down by 0.42%, Capital Goods down by 0.18% and Auto down by 0.11% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 1.57%, Mahindra & Mahindra up by 1.07%, BHEL up by 0.91%, HDFC Bank up by 0.61% and NTPC up by 0.61%. On the flip side, ICICI Bank down by 2.05%, Adani Ports &Special down by 1.90%, Hero MotoCorp down by 1.41%, Bajaj Auto down by 1.15% and GAIL India down by 1.03% were the top losers.

Meanwhile, the government has further extended the deadline for jewellers to get their businesses registered with central excise department. This is the second extension which the jewellers have got for registering their units. On March 21, a circular which had details of a committee with members from government and trade to sort out the issue, also said that registration can start from 60 days after March 1.

The latest circular issued by the ministry of finance said that the deadline for jewellers to get registered under excise rules has been extended to July 1. The tax will be applicable from March 1 itself, though. The dues for earlier months can be cleared together when the duty for June is finally paid. The circular came on April 23, just a day before the 10-day truce period was ending.

Centre proposed of levying one per cent excise duty on non-silver jewellery during the budget, but that led to the jewellers going on an indefinite strike, alleging that they had earlier experience of the department’s high-handedness. After continuing the agitation for more than a month, the jewellers finally decided on a 10-day break from April 14 to 24.

The Centre has constituted a panel under former Chief Economic Advisor Ashok Lahri to look into the demands of jewellers. The panel will look into issues related to compliance procedure for the excise duty, including records to be maintained, forms be filled, operating procedures, and other relevant issues.  

The CNX Nifty is currently trading at 7840.60, down by 14.45 points or 0.18% after trading in a range of 7822.55 and 7852.10. There were 24 stocks advancing against 26 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 3.46%, Idea Cellular up by 1.69%, Tata Steel up by 1.58%, Mahindra & Mahindra up by 1.22% and Tata Motors - DVR up by 1.13%. On the flip side, ICICI Bank down by 2.02%, Adani Ports &Special down by 1.92%, Hero MotoCorp down by 1.33%, Bajaj Auto down by 1.22% and Bharti Infratel down by 1.15% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 was down by 0.68%, Hang Seng down by 0.67%, Jakarta Composite down by 1.46%, FTSE Bursa Malaysia KLCI down by 0.72% and Shanghai Composite down by 0.28%. On the flip side, Taiwan Weighted was up by 0.3% and KOSPI Index was up by 0.04%.