Benchmarks continue lackluster trade in red

Indian equity benchmarks continued lackluster trade in red in the late afternoon session on account of selling in frontline blue chip counters in absence of any supportive cues in sight. Investors remained on sidelines ahead of global concerns such as the upcoming Brexit vote and Organization of the Petroleum Exporting Countries (OPEC) meeting scheduled today to revive idea of production ceiling. Some additional pressure also crept in as the Paris-based organization, OECD in its Global Economic Outlook has cautioned about NPAs in the banking sector rising in several countries, including India and termed it as a moral hazard. Traders were seen piling position in Metal, PSU and Auto stocks while selling was witnessed in Consumer Durables, FMCG and Realty sector stocks. In scrip specific development, Zee Learn was trading in green following the company’s decision to put on hold the merger deal with Tree House Education and Accessories (THEAL). The merger deal between Zee Learn and Tree House was announced in December 2015. Jyothy Laboratories was trading in green on buzz that Germany’s Henkel AG is looking to invest in the Mumbai-based FMCG company.

On the global front, the Asian markets were trading mostly in green while the European markets traded mostly on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 8,150 and 26,600 levels respectively. The market breadth on BSE was negative in the ratio of 1083:1374 while 150 scrips remained unchanged.

The BSE Sensex is currently trading at 26698.36, down by 15.57 points or 0.06% after trading in a range of 26641.02 and 26745.20. There were 18 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.29%, while Small cap index up by 0.05%.

The gaining sectoral indices on the BSE were Metal up by 1.77%, PSU up by 0.67%, Auto up by 0.38%, Capital Goods up by 0.29% and Power up by 0.19%, while Consumer Durables down by 0.74%, FMCG down by 0.65%, Realty down by 0.45%, IT down by 0.15% and TECK down by 0.03% were the losing indices on BSE.

The top gainers on the Sensex were Coal India up by 3.74%, Adani Ports & Special Economic Zone up by 1.68%, Tata Steel up by 1.46%, Hero MotoCorp up by 1.34% and Tata Motors up by 1.25%.

On the flip side, Wipro down by 2.85%, ITC down by 1.88%, Lupin down by 1.38%, Bajaj Auto down by 1.25% and Sun Pharma down by 1.12% were the top losers.

Meanwhile, concerned about the grim draught situation faced by some parts of the country, the Prime Minister's Office (PMO) has tasked Niti Aayog to prepare a contingency plan for 67 districts in the country that are prone to drought even in years of normal monsoon. The Irrigation Commission had identified 67 drought-prone districts, comprising 326 talukas across eight states with an area of 49.73 million hectares and the Niti Aayog will have to prepare location-specific remedial measures for all the identified districts.

The plan will include material as well as financial support to these districts year after year so as to help them improve their condition. It was reported that Niti Aayog has been asked to prepare the plan at the earliest so that the government can start addressing the problem forthwith.

Some of the financial measures being considered include enhanced subsidies, funding for sowing perennial crops and enhanced work allocation under rural employment guarantee programme. The material support could include making available seeds and other inputs to ensure that farmers get back to their fields with alternate crops even if the main crops fail.

About one-sixth of India, home to about 12% of the country's population, is drought-prone, with the areas that receive rainfall up to 60 cm a year being the most vulnerable. India is heavily dependent on monsoon rains, which have been poor for two years in a row. The government had recently said that nearly 256 districts across India, home to nearly a quarter of the population were impacted by the drought.

The CNX Nifty is currently trading at 8169.30, down by 10.65 points or 0.13% after trading in a range of 8154.75 and 8185.85. There were 24 stocks advancing against 25 stocks declining on the index.

The top gainers on Nifty were Coal India up by 3.90%, Idea Cellular up by 2.55%, Hindalco up by 2.13%, Adani Ports & Special Economic Zone up by 1.66% and Tech Mahindra up by 1.41%.

On the flip side, Wipro down by 3.07%, HCL Tech. down by 2.38%, ITC down by 2.14%, Lupin down by 1.47% and Bajaj Auto down by 1.28% were the top losers.

The Asian markets were trading mostly in green; Jakarta Composite increased 0.08 points or 0% to 4,839.75, KOSPI Index increased 2.39 points or 0.12% to 1,985.11, FTSE Bursa Malaysia KLCI increased 5.75 points or 0.35% to 1,632.25, Shanghai Composite increased 11.72 points or 0.4% to 2,925.23 and Hang Seng increased 98.24 points or 0.47% to 20,859.22.

On the other hand, Nikkei 225 decreased 393.18 points or 2.32% to 16,562.55 and Taiwan Weighted decreased 41.14 points or 0.48% to 8,556.02.

The European markets were trading mostly in red; Germany’s DAX decreased 19.63 points or 0.19% to 10,184.81, France’s CAC decreased 4.65 points or 0.1% to 4,470.74 while, UK’s FTSE 100 increased 21.31 points or 0.34% to 6,213.24.