Benchmarks erase gains to trade in red

Indian equity benchmarks erased gains and are now trading in red in the late afternoon session on account of selling in frontline blue chip counters. The sentiments were under pressure after International Monetary Fund (IMF) stated that China and Japan’s economies are expected to slow sharply over the next two years. In its Regional Economic Outlook for Asia and the Pacific, the Fund also warned of several external challenges, from weakness in advanced economies, weak global trade and increasingly volatile global financial markets. The Fund predicted growth in Asia to come in at 5.3% this year and next, down from its previous forecast of 5.4%. Traders were seen selling in Capital Goods, Realty and Power stocks while selling was witnessed in IT, FMCG and TECK sector stocks. In scrip specific development, Aurobindo Pharma was trading in green after the pharma company received USFDA approval for its epilepsy prevention drug Lacosamide. Emmbi Industries was trading firm after the Department of Scientific and Industrial Research, Government of India, issued Certificate of Registration recognizing Emmbi Innovation Lab an R&D arm of the company as ‘In-House R&D Unit’.

On the global front, the Asian markets were trading mixed while the European markets traded on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading below the psychological 7,800 and 25,300 levels respectively. The market breadth on BSE was negative in the ratio of 1192:1254 while 152 scrips remained unchanged.

The BSE Sensex is currently trading at 25296.49, down by 140.48 points or 0.55% after trading in a range of 25204.22 and 25705.96. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in green and red; the BSE Mid cap index was down by 0.53%, while Small cap index up by 0.14%.

The gaining sectoral indices on the BSE were Capital Goods up by 0.41%, Realty up by 0.37%, Power up by 0.14%, Auto up by 0.07% while, IT down by 1.14%, FMCG down by 0.99%, TECK down by 0.75%, PSU down by 0.73%, Oil & Gas down by 0.69% were the losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 2.03%, Tata Motors up by 1.74%, Adani Ports & Special Economic Zone up by 1.60%, Larsen & Toubro up by 1.21% and Asian Paints up by 0.96%.

On the flip side, Coal India down by 2.10%, Lupin down by 2.09%, Hindustan Unilever down by 1.66%, Sun Pharma down by 1.56% and Dr. Reddy’s Lab down by 1.55% were the top losers.

Meanwhile, concerned over the large amount of dues that need to be recovered by all coal PSUs, Standing committee on Coal and Steel has asked the government as well as the state-owned firms in the sector to take steps for the recovery. The committee highlighted that the large amount of outstanding dues of all coal PSUs such as CIL, SCCL and NLC standing at Rs 11,032.20 crore, Rs 2,441.32 crore and Rs 272.04 crore (including disputed dues of Rs 129.09 crore) respectively as on 31.3.2015 remain unrealized from concerned ministries/parties.

The committee further noted that in Neyveli Lignite Corporation (NLC), to encourage early realization, a special scheme called Graded Rebate Scheme has been put in place. The Scheme provides for graded rebate from a maximum of 2 per cent for payment on date of billing to 0 per cent on the 60th day of billing has been put in place along with a onetime waiver of 50 per cent of settlement incorporating a payment priority clause.

According to the government, the committee said that slew of steps are being taken for regular follow up to realize outstanding dues with concerned ministries. The steps include review of party-wise outstandings by general manager/CMDS and Chairman, Coal India (CIL) with the Chairman of defaulting power houses which are then taken upto the level of Chief Secretary of concerned States.

The CNX Nifty is currently trading at 7770.40, down by 35.50 points or 0.45% after trading in a range of 7735.15 and 7890.25. There were 20 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were Aurobindo Pharma up by 4.51%, Tata Power up by 2.64%, Tata Motors - DVR up by 2.40%, Bharti Airtel up by 2.33% and Power Grid Corporation up by 2.28%.

On the flip side, Coal India down by 2.60%, Lupin down by 2.10%, Kotak Mahindra Bank down by 1.68%, Hindustan Unilever down by 1.67% and TCS down by 1.65% were the top losers.

The Asian markets were trading mixed; Hang Seng decreased 390.11 points or 1.85% to 20,676.94, Taiwan Weighted decreased 83.78 points or 1% to 8,294.12 and FTSE Bursa Malaysia KLCI decreased 20.35 points or 1.22% to 1,652.37.

On the other hand, Jakarta Composite increased 3.33 points or 0.07% to 4,811.65, KOSPI Index increased 8.26 points or 0.42% to 1,986.41 and Shanghai Composite increased 54.32 points or 1.85% to 2,992.64.

Japanese stock exchange was closed on account of ‘Constitution Day’ holiday.

The European markets were trading in red; UK’s FTSE 100 decreased 48.96 points or 0.78% to 6,192.93, Germany’s DAX decreased 158.31 points or 1.56% to 9,964.96 and France’s CAC decreased 54.32 points or 1.22% to 4,388.43.