Sluggishness continues on Dalal Street in noon deals

Continuing their sluggish run, Indian equity benchmarks are trading with a cut of over one third of a percent in noon deals as traders remained cautious ahead of the Assembly election results of the Assembly elections in West Bengal, Tamil Nadu, Assam, Kerala and Puducherry scheduled today. Fall in the crude oil prices and weakness in the Asian peers after Federal Open Market Committee (FOMC) meeting minutes raised hopes of an interest rate hike in the near future has also dampened the sentiments. Besides, weakness in Indian rupee too weighed down sentiments. The rupee plummeted 26 paise against the US dollar to 67.24 in noon deals, its weakest level since March, due to appreciation of the American currency overseas amid foreign fund outflows.

On the sectoral front, power counter witnessed selling despite government approving three foreign direct investment proposals, all related to the pharmaceutical sector, worth Rs. 60.73 crore. Oil and gas counter too facing selling pressure despite Minister of State for Petroleum and Natural Gas, Dharmendra Pradhan stating that natural gas from coal bed methane is likely to contribute to five per cent of national gas production by 2017.

The BSE Sensex is currently trading at 25607.62, down by 96.99 points or 0.38% after trading in a range of 25555.42 and 25714.56. There were 10 stocks advancing against 20 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.04%, while Small cap index up by 0.34%.

The top gaining sectoral indices on the BSE were Realty up by 1.40%, Metal up by 0.58%, Basic Materials up by 0.51%, Industrials up by 0.17% and Auto up by 0.21%, while, FMCG down by 1.23%, Telecom down by 0.68%, Finance down by 0.43%, PSU down by 0.37% and Consumer Durables down by 0.33% were the top losing indices on BSE.

The top gainers on the Sensex were Lupin up by 1.87%, Tata Steel up by 1.58%, Tata Motors up by 1.43%, BHEL up by 1.21% and ICICI Bank up by 0.80%. On the flip side, ITC down by 2.37%, HDFC down by 1.82%, SBI down by 1.78%, ONGC down by 1.38% and Bharti Airtel down by 1.15% were the top losers.

Meanwhile, the government’s proposal to allow foreigners to retail food products has been caught in interministerial differences on whether conditions need to be imposed for such investments and market access. Finance minister Arun Jaitley had in the budget for the current fiscal announced that 100% FDI would be allowed through the approval route in marketing of food products produced and manufactured in India which will benefit farmers, give momentum to food processing industry and also create vast employment opportunities. The government wants to open up retail of food products to boost the farming and rural economy.

Department of Industrial Policy and Promotion (DIPP) and the finance ministry are not keen on sectoral conditions, which are difficult to monitor and often act as a deterrent. A formal note has been moved by the DIPP that will be taken up by the Cabinet once these differences are resolved.

The food ministry is however keen on imposing conditions on the lines of those for multi-brand retail as it faces various conditions including mandatory 30% sourcing from local micro, small and medium industries. Further, the multi-brand retail sector, which is open for up to 49% FDI, has  conditions including opening up of retail outlets only in cities with a  population of more than 10 lakh as per 2011Census, 50% of total FDI be brought in the first tranche with a minimum capital of $100 million and mandatory sourcing.

The CNX Nifty is currently trading at 7844.55, down by 25.60 points or 0.33% after trading in a range of 7826.20 and 7876.20. There were 16 stocks advancing against 34 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 1.66%, Hindalco up by 1.63%, BPCL up by 1.56%, Tata Motors up by 1.48% and Lupin up by 1.40%. On the flip side, ITC down by 2.34%, Bank of Baroda down by 1.93%, HDFC down by 1.92%, SBI down by 1.78% and ONGC down by 1.35% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 145.59 points or 0.73% to 19,680.82, Taiwan Weighted shed 63.7 points or 0.78% to 8,095.98, Jakarta Composite fell 34.08 points or 0.72% to 4,700.28, KOSPI Index slipped 9.95 points or 0.51% to 1,946.78 and FTSE Bursa Malaysia KLCI was down by 2.07 points or 0.13% to 1,633.65.

On the flip side, Shanghai Composite increased 0.35 points or 0.01% to 2,807.86 and Nikkei 225 was up by 1.97 points or 0.01% to 16,646.66.