Benchmarks extended their losses in late noon trade

Indian equity markets extended their losses in late noon session due to heavy selling by investors amid weak global cues. Sentiments remained down-beat with report that India’s merchandise exports contracted again, albeit at their slowest pace in 18 months in May as non-petroleum exports finally turned positive, led by exports of engineering goods and gems and jewellery. Exports contracted at 0.79% in May while imports slipped 13.16%, leaving a trade deficit of $6.27 billion. The mood was pressured, after foreign portfolio investors (FPIs) sold shares worth a net Rs 108.23 crore yesterday, 15 June 2016, as per provisional data released by the stock exchanges. Indian rupee pared its initial gains to depreciate by 6 paise to 67.21 against the American currency in late morning deals following fresh bouts of dollar demand from importers and banks.

On global front, Asian stocks dropped with Japanese stocks falling behind their peers after the Bank of Japan (BoJ) kept monetary policy steady as was widely expected. US stocks ended lower yesterday marking a fifth session of losses, after the US Federal Reserve left interest rates unchanged and backed off an aggressive stance on future rate hikes.

Back home, in scrip specific development, shares of the three public listed subsidiaries of State Bank of India (SBI), State Bank of Mysore, State Bank of Travancore and State Bank of Bikaner and Jaipur (SBBJ) continued to remain investor’s favorite for the second straight day as they hit their fresh 52-week high on Thursday.

The BSE Sensex is currently trading at 26405.50, down by 320.84 points or 1.20% after trading in a range of 26314.91 and 26686.03. There were 4 stocks advancing against 26 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.73%, while Small cap index declined by 0.84%.

The top losing sectoral indices on the BSE were Bankex down by 1.68%, Realty down by 1.40%, Auto down by 1.27%, Power down by 1.24%, Capital Goods down by 1.24%.

The gainers on the Sensex were GAIL India up by 0.81%, Wipro up by 0.21%, Lupin up by 0.06% and Asian Paints up by 0.02%. On the flip side, ICICI Bank down by 3.62%, Maruti Suzuki down by 2.95%, Adani Ports &Special down by 1.76%, NTPC down by 1.75% and Bharti Airtel down by 1.75% were the top losers.

Meanwhile, concerned about the rising prices of essential commodities like pulses and vegetables, the government has decided to boost supply through its newly created buffer stock and imports. The prices of pulses are ruling at Rs 170 per kg and tomato prices have spiked to Rs 100 a kg.

At a high-level meeting, Finance Minister Arun Jaitley discussed the reasons for the spike in prices and ways to control it with Agriculture Minister Radha Mohan Singh, Food Minister Ram Vilas Paswan, Transport Minister Nitin Gadkari, Commerce Minister Nirmala Sitharaman and Urban Development Minister M Venkaiah Naidu.

The ministers discussed reasons for the spike in prices and possible options available to check the same at the meeting. Among the other issues discussed were the releasing more pulses from the buffer stock whenever there is a demand from the states as well as importing pulses from Mayanmar and Africa to deal with the price rise.

The price of vegetables is a major concern for the government, with the Wholesale Price Index or WPI data for May showing that vegetable inflation rose sharply from 2.21 per cent in April to 12.94 per cent. The Finance Minister also said that imports via public and private agencies should be strengthened to meet the deficit. The government has procured 1.15 lakh tonnes pulses directly from farmers as of now for creating a buffer stock of 1.5 lakh tonnes this year. It is also importing pulses through state-owned trading agencies like MMTC. So far, 38,500 tonnes of lentils have been contracted for import.

The CNX Nifty is currently trading at 8101.35, down by 105.25 points or 1.28% after trading in a range of 8074.45 and 8180.65. There were 5 stocks advancing against 46 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 1.17%, GAIL India up by 1.09%, Wipro up by 0.26%, Eicher Motors up by 0.21% and Asian Paints up by 0.06%. On the flip side, ICICI Bank down by 3.57%, Maruti Suzuki down by 3.01%, Bharti Infratel down by 3.01%, Indusind Bank down by 2.45% and Ultratech Cement down by 2.09% were the top losers.

The Asian markets were trading in red, Nikkei 225 fell by 485.44 points or 3.05% to 15,434.14. Hang Seng decreased by 415.89 points or 2.03% to 20,051.63. Taiwan Weighted was lower by 112.23 points or 1.3% to 8,494.14.KOSPI Index was down by 16.84 points or 0.86% to 1,951.99. Shanghai Composite decreased 14.39 points or 0.5% to 2,872.82. FTSE Bursa Malaysia KLCI declined by 13.58 points or 0.83% to 1,614.38. Jakarta Composite dropped 11.15 points or 0.23% to 4,803.68.