Choppiness continues on Dalal Street in noon deals

Indian equity benchmarks continued to trade sluggish in noon deals as traders opted to stay away in buying risky assets ahead of RBI monetary policy review on Tuesday. Markets participants were also eying for the industrial production data for April due later this week. Sentiments remained dampened as a survey from industry body, CII has said that government needs to speed up implementation of GST, address the issue of cheap imports and improve investment climate as majority of sectors are witnessing ‘moderate’ growth. However, losses remained capped as the rupee strengthened by 32 paise to 66.93 against the US dollar in early trade at the Interbank Foreign Exchange market in noon deals on increased selling of the American currency by exporters amid foreign fund inflows. Besides, Asian markets were trading mostly in green at this point of time after US non-farm payrolls showed the slowest job growth in more than five years, quashing expectations for a near-term US interest rate hike.

Back home, on the sectoral front, stocks related to oil & gas pack were trading in red despite the government showing interest in joint exploration of new oil and gas fields as well as development of discovered assets in resource-rich Qatar, as the two countries decided to focus on enhancing cooperation in the energy sector. On the flip side, chemical stocks remained on buyers’ radar, as government has imposed anti-dumping duty of $0.277- 0.404 per kilogram on a compound, used in the pharmaceutical industry, imported from the US and China to protect domestic makers from cheap shipments. Shares of sugar companies too were trading higher after the rating agency ICRA said the profitability trend for domestic sugar mills is likely to be better during the crushing season 2015-16 on supply correction.

The BSE Sensex is currently trading at 26813.69, down by 29.34 points or 0.11% after trading in a range of 26795.34 and 26901.42. There were 9 stocks advancing against 21 stocks declining on the index.

The broader indices were trading in mixed; the BSE Mid cap index was down by 0.04%, while Small cap index up by 0.18%.

The top gaining sectoral indices on the BSE were Realty up by 0.87%, Basic Materials up by 0.50%, Capital Goods up by 0.48%, Bankex up by 0.16% and Finance up by 0.07%, while Telecom down by 1.34%, Consumer Durables down by 1.04%, Energy down by 0.51%, TECK down by 0.46% and Oil & Gas down by 0.46% were the top losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 1.59%, SBI up by 1.48%, GAIL India up by 1.46%, Cipla up by 1.27% and HDFC Bank up by 0.42%. On the flip side, Maruti Suzuki down by 2.00%, Bharti Airtel down by 1.59%, Axis Bank down by 1.25%, Coal India down by 1.02% and TCS down by 0.79% were the top losers.

Meanwhile, Finance Minister Arun Jaitley, ahead of RBI’s bi-monthly monetary policy review meeting has stressed that India’s economy has become stronger and the government is trying to bridge the gaps wherever there are any, to keep up the growth momentum. He further said that the government is trying to improve the health of the banks so that they can support the 'growth' of the economy.

Jaitley also said that the government has sufficiently empowered the banks to recover their dues but added that they will have to maintain their credit lending facility so that lending for growth continues. Finance Minister will hold a quarterly performance review with CEO’s of public sector banks (PSB) to discuss various key challenges faced by the banking sector including growing non-performing assets, at a time when these are severely stressed by bad loans and have incurred record losses in the last quarter.

The meeting assumes significance as several PSBs have posted record losses in the fourth quarter of the 2015-16. The gross NPAs or bad loans of PSBs rose from Rs 2,67,065 lakh crore in March 2015 to Rs 3,61,731 lakh crore in December.  The gross non-performing assets (NPAs) of the PSBs increased from 5.43 per cent of advances as on March 2015 to 7.30 per cent as on December 31. Jaitley further added that the government is looking at a stage where the banks have now been making provisioning for the possible NPAs and have been empowered sufficiently to recover the dues.

The CNX Nifty is currently trading at 8209.40, down by 11.40 points or 0.14% after trading in a range of 8204.90 and 8234.70. There were 17 stocks advancing against 34 stocks declining on the index.

The top gainers on Nifty were Bank of Baroda up by 1.85%, Mahindra & Mahindra up by 1.55%, SBI up by 1.40%, GAIL India up by 1.28% and Ultratech Cement up by 1.20%. On the flip side, Maruti Suzuki down by 1.94%, Tech Mahindra down by 1.94%, Bharti Infratel down by 1.89%, BPCL down by 1.61% and Bharti Airtel down by 1.58% were the top losers.

Asian markets were trading mostly in green; KOSPI Index rose 0.73 points or 0.04% to 1,985.84, Taiwan Weighted gained 5.54 points or 0.06% to 8,597.11, FTSE Bursa Malaysia KLCI increased 8.33 points or 0.51% to 1,644.79, Hang Seng added 12.64 points or 0.06% to 20,959.88 and Jakarta Composite was up by 25.27 points or 0.52% to 4,879.19.

On the flip side, Nikkei 225 decreased 62.2 points or 0.37% to 16,580.03 and Shanghai Composite was down by 8.1 points or 0.28% to 2,930.58.