Markets trade in tight band with negative bias in early noon session

Indian equity benchmarks continued to trade in a narrow range with negative bias in early noon session due to profit-booking by investors in recent gainers. Investors remain wary ahead of Thursday’s British vote, as well as Federal Reserve chief Janet Yellen’s two-day testimony before Congress starting later today, as she might offer clues on the timing of the next US interest rate increase. However, losses remained capped as investors getting some support with report of weather department - India Meteorological Department saying that monsoon rains have covered nearly half of the country, accelerating planting of summer crops like paddy rice, soybeans, cotton and pulses. The June to September monsoon is crucial for farm output and economic growth in India, where just over half of arable land is fed by rain. The farm sector makes up about 15 percent of the $2-trillion economy that is Asia's third biggest. Meanwhile, Commerce and Industry Minister Nirmala Sitharaman stated that the government is monitoring the developments of 'Brexit', or Britain's exit from the European Union. On Goods and Services Tax (GST), she said that the finance minister is talking to all the political parties. Tamil Nadu has certain issues as that is a manufacturing state and they have some natural reservations and ‘I expect that the Tamil Nadu Chief Minister will support the GST’.

On the global front, Asian markets were trading mostly higher at this point of time cautiously extending a rally, triggered by growing expectations that British voters will opt to remain in the European Union in this week’s referendum. Back home, in scrip specific development, share of Siti Cable Network were trading higher after the government allowed 100% foreign direct investment for the broadcasting sector comprising of teleports, direct-to-home, cable networks, mobile TV and head-in-the-sky (HITS). On flip side, Shares of food companies such as Jubilant FoodWorks, Britannia Industries and Westlife Development were trading down after the food regulator banned the use of potassium bromate as a food additive.

The BSE Sensex is currently trading at 26821.26, down by 45.66 points or 0.17% after trading in a range of 26776.16 and 26925.64. There were 14 stocks advancing against 16 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.34%, while Small cap index up by 0.42%.

The top gaining sectoral indices on the BSE were Auto up by 0.48%, PSU up by 0.31%, Metal up by 0.24%, Oil & Gas up by 0.16% and Realty up by 0.12%, while Power down by 0.32%, TECK down by 0.25%, Bankex down by 0.18%, IT down by 0.17% and Consumer Durables down by 0.14% were the top losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 1.20%, ICICI Bank up by 1.03%, ONGC up by 0.84%, Adani Ports &Special up by 0.77% and Bajaj Auto up by 0.74%. On the flip side, NTPC down by 1.23%, Asian Paints down by 1.02%, Axis Bank down by 0.96%, Hindustan Unilever down by 0.88% and HDFC Bank down by 0.82% were the top losers.

The CNX Nifty is currently trading at 8226.65, down by 11.85 points or 0.14% after trading in a range of 8210.00 and 8257.25. There were 18 stocks advancing against 33 stocks declining on the index.

Meanwhile, with an aim to push labor reforms, the labour ministry has lined up amendments of four key laws for the Cabinet’s approval. The laws include Shop & Establishment Act and also amendments to the Employees’ Provident Funds & Miscellaneous Provisions Act, 1952, amendments to the Maternity Benefits Act, 1961 and the amendments to the Employees' Compensation Act, 1923. The decision was taken after the meeting between the officials of the labour ministry and the Prime Minister's Office (PMO) last week. The idea is to line up enough legislation for Parliament’s approval in the upcoming monsoon session.

Among the four legislation, first that could soon get an approval from Cabinet is the Shop & Establishment Act, which will pave the way for retailers in order to remain open round the clock. The model Shop & Establishment Act is expected to come up for cabinet’s approval in this week. Under the model Shop & Establishment Act, which will be made effective through a notification, bricks-and-mortar stores will have the flexibility to remain open round the clock.  Further the Shop & Establishment Act will provide equal opportunity in order to compete with their online peers. At present, shops remains closed on a specified day depending on traditional practices and there is no provision for shops to remain open round the clock.

Moreover, as proposed by Jaitley in the previous budget a year ago the other amendments to the EPF & MP Act will provide EPFO subscribers an option of choosing between EPF and the New Pension System. However, the amendments to the Maternity Benefit Act could more than double the maternity leave to 26 weeks from the existing 12 weeks.

The top gainers on Nifty were Hindalco up by 1.98%, Mahindra & Mahindra up by 1.27%, ICICI Bank up by 1.11%, ONGC up by 0.87% and Bajaj Auto up by 0.84%. On the flip side, NTPC down by 1.52%, Tech Mahindra down by 1.39%, Tata Power down by 1.07%, Indusind Bank down by 1.00% and Hindustan Unilever down by 0.94% were the top losers.

Asian markets were trading mostly higher; KOSPI Index increased 1.58 points or 0.08% to 1,982.70, Shanghai Composite increased 5.18 points or 0.18% to 2,893.99, Jakarta Composite increased 10.54 points or 0.22% to 4,874.07, Taiwan Weighted increased 58.93 points or 0.68% to 8,684.85, Hang Seng increased 159.55 points or 0.78% to 20,669.75 and Nikkei 225 increased 203.81 points or 1.28% to 16,169.11, while FTSE Bursa Malaysia KLCI decreased 0.05 points or 0% to 1,634.18.