Benchmarks trade flat on subdued global cues

Indian equity benchmarks are trading flat in early deals, as traders remained on sidelines awaiting progress on the tax reforms bill. Subdued global cues too dampened sentiments as all the Asian counters were trading in red at this point of time, tailing the decline in US markets overnight, as prospects for central bank stimulus in Japan cooled after ECBs decision. The US markets ended modestly lower in last session and the Dow snapped a nine-session streak of gains, mainly on weak set of earnings led by tech stalwart Intel and from transportation companies.

Back home, frontline gauges managed to hold on to their crucial 27,700 (Sensex) and 8,500 (Nifty) levels as some support with a private poll stating that India's economy will hum along at a solid pace for the remainder of this fiscal year provided structural reforms are passed, while above-target inflation means the Reserve Bank of India will only cut rates once more this year. Meanwhile, Finance Minister Arun Jaitley has said that India has underlined the need for a judicious mix of fiscal, monetary and structural policies by major economies to deal with the heightened uncertainty on account of Brexit.

On the sectoral front, the infra sector stocks remained in action with the CII, infra panel urging the government to speed up the recommendations of Kelkar committee report based on interactions with private sector developers, bankers, regulators, private equity funds. However, banking stocks continue to trade lower for yet another day on assets quality concern.

The BSE Sensex is currently trading at 27716.32, up by 5.80 points or 0.02% after trading in a range of 27653.75 and 27764.19. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.32%, while Small cap index gained 0.17%.

The top gaining sectoral indices on the BSE were Utilities up by 0.88%, Power up by 0.83%, Realty up by 0.59%, Auto up by 0.43% and Capital Goods up by 0.42%, while IT down by 0.42%, Metal down by 0.38%, Bankex down by 0.35%, TECK down by 0.22% and PSU down by 0.10% were the top losing indices on BSE.

The top gainers on the Sensex were Power Grid up by 1.63%, GAIL India up by 1.47%, Asian Paints up by 0.99%, ITC up by 0.94% and Tata Motors up by 0.92%. On the flip side, Infosys down by 0.95%, Hindustan Unilever down by 0.95%, SBI down by 0.89%, Bajaj Auto down by 0.88% and Sun Pharma down by 0.81% were the top losers.

Meanwhile, Finance Minister Arun Jaitley has underlined the need for a judicious mix of fiscal, monetary and structural policies by major economies to deal with the heightened uncertainty on account of Brexit. Jaitley said that Britain's decision to exit from the European Union has further heightened uncertainty, market volatility and risk-averse behaviour.

Jaitley who could not attend the first annual meeting of the Board of Governors of the New Development Bank (NDB) held in Shanghai, because of the ongoing Parliament session back home, said in a written speech read out by Joint Secretary in the Finance Ministry Raj Kumar that governments, central banks and regulators have to mitigate the pressure of such vulnerabilities through judicious mix of fiscal, monetary and structural policies.He further said that India is following the approach of ‘Reform to Transform’ through far-reaching structural reforms. “We have taken several initiatives to boost investment climate and improve the ease of doing business.”

Jaitley outlining the challenges said the current global economic context is far from being robust and is marked by a modest pickup in some advanced economies from their low levels of growth. He also said that decline in growth in emerging markets and developing economies, increased financial sector volatility, and, in general, a downward revision of global growth projections by the International Monetary Fund (IMF) also pose challenges. Meanwhile, India has called for the NDB-set up by the BRICS countries to develop a strong pipeline of projects, with focus on cost-effective energy generation, transport projects that reduce regional inequality and promote inclusive growth, and urban infrastructure projects.

The CNX Nifty is currently trading at 8505.85, down by 4.25 points or 0.05% after trading in a range of 8489.80 and 8525.40. There were 23 stocks advancing against 28 stocks declining on the index.

The top gainers on Nifty were Power Grid up by 1.82%, GAIL India up by 1.71%, Zee Entertainment up by 1.51%, Tata Power up by 1.48% and Bharti Infratel up by 1.04%. On the flip side, Hindalco down by 2.28%, ACC down by 1.20%, Bajaj Auto down by 1.15%, SBI down by 1.00% and Hindustan Unilever down by 0.97% were the top losers.

Asian markets were trading in red; Nikkei 225 declined 197.26 points or 1.17% to 16,612.96, Hang Seng decreased 99.29 points or 0.45% to 21,901.20, Taiwan Weighted dropped 41.37 points or 0.46% to 9,015.19, Jakarta Composite shed 23.91 points or 0.46% to 5,193.07, Shanghai Composite fell 20.19 points or 0.66% to 3,018.82, FTSE Bursa Malaysia KLCI slipped 3.18 points or 0.19% to 1,654.36 and KOSPI Index was down by 0.8 points or 0.04% to 2,011.42.