Benchmarks continue to gyrate in red

Indian Equity benchmarks continue to trade in red territory in the late afternoon session on account of across the board selling as participants adopted a cautious approach ahead of GST debate in Upper House of Parliament. Sentiments also remained down-beat with a private report stating that consumer confidence in India declined in the second quarter this year with concerns over fuel prices and rising inflation, making the country lose the top position it occupied for the last two years as the most confident globally. Besides, weak Asian cues also influenced investors’ sentiment. Traders largely overlooked a private survey showing that the Nikkei India Services Purchasing Managers’ Index, or PMI, rose to 51.9 in July from 50.3 in June. The reading for July was the highest in three months.

On the global front, Asian market were trading in red as fears that the Bank of Japan may retreat from its massive bond-buying campaign added to a shakeout in debt markets globally.

The BSE Sensex is currently trading at 27779.18, down by 202.53 points or 0.72% after trading in a range of 27704.42 and 28015.43. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 1.26%, while Small cap index was down by 1.01%.

The lone gaining sectoral index on the BSE was Metal up by 0.11%, while FMCG down by 1.45%, Realty down by 1.45%, Power down by 1.42%, Capital Goods down by 1.28% and Consumer Durables down by 1.17% were the losing indices on BSE.

The top gainers on the Sensex were Cipla up by 1.80%, Asian Paints up by 1.23%, Coal India up by 1.10%, Sun Pharma Inds. up by 0.44% and Hero MotoCorp up by 0.31%. On the flip side, Power Grid Corpn. down by 2.69%, ITC down by 2.08%, Tata Motors down by 1.94%, Maruti Suzuki down by 1.88% and Reliance Industries down by 1.35% were the top losers.

Meanwhile, infrastructure deficit is the biggest obstacle to the government’s flagship ‘Make in India’ programme, as per International credit rating agency Standard & Poor's(S&P). The rating agency said that the infrastructure deficit is costing up to five per cent of the country’s GDP and an improvement will boost export competitiveness. It added that Asia’s largest economy China also faces problems on the infrastructure front.

In its latest report S&P stated that there are problems in the transportation sector with capacity constraints and highlighted the need for better regulation. It added that India’s transportation infrastructure sector could significantly benefit from a stable regulatory environment that has an independent regulator, appropriate dispute- resolution mechanisms and supportive, comprehensive policies. It also noted that the government is scaling up spending, but its heavy debt burden could derail its ambitions to improve public infrastructure.

It further said that India Inc. will see a turnaround in performance soon. It also said that revenue growth is expected to move up in the next 2-3 years and this will be possible largely on increased government spending and the consequent increase in domestic economy.

The Rating agency also said that the passage of the Goods and Services Tax Bill, billed as the country’s biggest indirect tax reform, will give a boost to the logistics and manufacturing sectors. It also said that every rupee invested in infrastructure development has a ripple effect and helps the GDP by Rs 2.

The CNX Nifty is currently trading at 8569.50, down by 53.40 points or 0.62% after trading in a range of 8545.15 and 8635.45. There were 16 stocks advancing against 35 stocks declining on the index.

The top gainers on Nifty were HCL Tech. up by 3.73%, Cipla up by 2.21%,Bharti Infratel up by 2.00%, Coal India up by 1.24% and Asian Paints up by 1.16%. On the flip side, Power Grid Corpn. down by 2.77%, ITC down by 2.34%, BHEL down by 2.16%, Tata Motors down by 1.93% and Maruti Suzuki down by 1.81% were the top losers.

Asian markets were trading mostly in red, Hang Seng decreased 320.5 points or 1.45% to 21,808.64, Nikkei 225 decreased 308.34 points or 1.88% to 16,083.11, Taiwan Weighted decreased 67.05 points or 0.74% to 9,001.71, KOSPI Index decreased 24.24 points or 1.2% to 1,994.79, FTSE Bursa Malaysia KLCI decreased 9.3 points or 0.56% to 1,650.93 and Jakarta Composite decreased 6.06 points or 0.11% to 5,367.26. On the flip side, Shanghai Composite increased 3.58 points or 0.12% to 2,974.86.