Markets continue to reel under pressure in noon deals

Pressurized by feeble global cues, Indian equity benchmarks continued to reel under pressure in noon deals. Caution ahead of industrial production data for April, slated to be released tomorrow, too dampened sentiment. Concern over rising crude oil prices, which are hovering near their one year highs, too weighed down sentiments. Traders failed to get any sense of relief with Prime Minister Narendra Modi’s statement that his dream was to economically empower every Indian by 2022, the 75th anniversary of India's Independence Day. Regional counterparts too were trading lower at this point of time Asian stocks turned lower on Thursday, led by sliding Japanese equities, while a weaker dollar buoyed commodities such as gold and crude oil.

Back home, depreciation in Indian rupee too dampened sentiments. On the sectoral front, Metal & mining stocks gained as copper prices rose in global commodity markets. Infra stocks edged higher, as the governing council of National Investment and Infrastructure Fund chaired by finance minister Arun Jaitley reviewed progress of operationalising India’s maiden sovereign wealth fund NIIF, including the selection of its CEO and projects shortlisted for making initial investments. The government has proposed a corpus of Rs 40,000 crore for NIIF, which will invest in infrastructure projects.

The BSE Sensex is currently trading at 26832.16, down by 188.50 points or 0.70% after trading in a range of 26809.09 and 26994.91. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.10%, while Small cap index up by 0.42%.

The top gaining sectoral indices on the BSE were Metal up by 1.71%, Oil & Gas up by 1.44%, PSU up by 1.38%, Power up by 1.00% and Realty up by 0.65%, while IT down by 1.96%, TECK down by 1.59%, FMCG down by 1.17%, Auto down by 0.35% and Capital Goods down by 0.13% were the top losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 2.01%, ONGC up by 1.88%, NTPC up by 1.82%, Cipla up by 1.28% and BHEL up by 1.15%. On the flip side, Infosys down by 3.77%, Hindustan Unilever down by 2.19%, ITC down by 1.85%, Dr. Reddys Lab down by 1.78% and HDFC down by 1.69% were the top losers.

Meanwhile, in a positive development, the defence logistics pact or the Logistics Exchange Memorandum of Agreement (LEMOA) between India and the US has come close to reality, as both the sides finalizing the pact during Prime Minister Narendra Modi’s visit. In the next step, the pact requires approval of the Cabinet Committee on Security (CCS) and once approved it won’t require Defence Minister’s presence and can be signed at a junior official levels.

Pact for LEMOA, which entails sharing of each other’s military bases, defence supplies, army vessels and aircraft on an operational basis during peace time and not during conflicts, was The pact was agreed in-principle during the visit to US Defence Secretary Ashton Carter to India in April. It will help the Indian defence forces during natural disasters, peacekeeping and rescue operations and terrorist attacks.

The LEMOA, which is a tweaked version of the US’ Logistics Support Agreement (LSA) facilitating the provision of logistical support, supplies and services between the US military and the armed forces of partner countries, is one of the three defence foundational pacts that America is pushing India to sign in order to boost defence ties between both countries. Obama administration is pushing for other two pacts which are Communication Interoperability and Security Memorandum Agreement (CISMOA) and Basic Exchange and Cooperation Agreement (BECA). However, it will not be possible to conclude the negotiations on the remaining two pacts before the Obama administration exits office.

The CNX Nifty is currently trading at 8226.15, down by 46.90 points or 0.57% after trading in a range of 8215.95 and 8273.35. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 2.88%, Reliance Industries up by 2.10%, Bank Of Baroda up by 1.99%, NTPC up by 1.92% and ONGC up by 1.85%. On the flip side, Infosys down by 3.71%, Hindustan Unilever down by 2.25%, ITC down by 2.01%, Dr. Reddys Lab down by 1.99% and HDFC down by 1.85% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 declined 162.51 points or 0.97% to 16,668.41, Jakarta Composite slipped 16.67 points or 0.34% to 4,899.40 and KOSPI Index was down by 2.91 points or 0.14% to 2,024.17. On the flip side, FTSE Bursa Malaysia KLCI was up by 1.17 points or 0.07% to 1,659.02.