Benchmarks extend losses; Nifty slips below 8600 mark

Indian equity benchmarks extended their losses hovering near the lowest point of the day in the late morning session on account of selling in front line blue chip counters. Investors failed to draw some solace from reports that India’s direct tax collection for the June quarter of FY2017 grew 24%, while indirect tax collection was up by 30%. The collection up to July indicates that 18.82% of the Annual Budget target of direct taxes has been achieved in the first four months of the fiscal. Traders were seen selling in Consumer Durables, Oil & Gas and Bankex sector stocks. In scrip specific development, JK Tyre & Industries was trading in red after its consolidated net profit declined by 14.35% to Rs 100.26 crore with 0.88% growth in total income to Rs 1786.77 crore in Q1 June 2016 over Q1 June 2015. UCO Bank and Indian Overseas Bank (IOB) were trading under severe pressure following losses that the lenders reported for the June quarter.

On the global front, Asian markets were trading mostly in green, largely muted reaction to a record high in US stocks, while a stronger yen kept pressure on Japan’s Nikkei Stock Average. The street is focused on economic data out of China that could dictate market moves later in the week. Foreign direct investment, new loans and loan growth data are due late Wednesday. Back home, the NSE Nifty and BSE Sensex were trading below the psychological 8,600 and 27,900 levels respectively. The market breadth on BSE was negative in the ratio of 686:1501 while 99 scrips remained unchanged.

The BSE Sensex is currently trading at 27881.01, down by 204.15 points or 0.73% after trading in a range of 27846.57 and 28143.28. There were 6 stocks advancing against 24 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.88%, while Small cap index was down by 0.76%.

The losing sectoral indices on the BSE were Consumer Durables down by 1.23%, Oil & Gas down by 1.17%, Bankex down by 1.03%, Realty down by 1.00% and Capital Goods down by 0.90%.

The top gainers on the Sensex were Adani Ports & Special Economic Zone up by 5.91%, TCS up by 0.62%, Bajaj Auto up by 0.47%, NTPC up by 0.34% and Bharti Airtel up by 0.33%.

On the flip side, Lupin down by 2.96%, ICICI Bank down by 1.87%, Reliance Industries down by 1.73%, Cipla down by 1.57% and Dr. Reddys Lab down by 1.41% were the top losers.

Meanwhile, with an aim to protect domestic manufacturers from cheap imports, the government has imposed an anti-dumping duty on certain hot-rolled steel products from six countries-China, Japan, Korea, Russia, Brazil and Indonesia. The duty will be the difference between the landed value and the prescribed value, which is $474 per tonne and $557 per tonne, respectively. 

A duty of $474 a tonne was imposed on import of HR flat products of alloy or non-alloy steel of a width up to 2,100 mm and thickness up to 25 mm from Korea and Japan. A similar anti-dumping duty was slapped on import of similar products from China. Imports of the same from Indonesia, Russia and Brazil too attracted $474 per tonne duty. Hot rolled flat products of alloy or non-alloy steel not in coils (commonly known as sheets and plates) of a width up to 4950 mm and thickness upto 150 mm imported from the six nations would attract $ 557 per ton anti-dumping duty. 

The restrictive duty was imposed on the recommendation of the Directorate General of Anti-Dumping (DGAD) and it would be in force till February 7, 2017. DGAD has come to the provisional conclusion that the subject goods have been exported to India from the subject countries below normal value (and) the domestic industry has suffered material injury on account of subject imports from the subject countries. Also, DGAD felt that the injury has been caused by the dumped imports of the subject goods from the subject countries. India is also likely to impose anti- dumping duty on imports of certain cold-rolled steel products from four countries - China, Japan, Korea and Ukraine.

The government had recently extended the minimum import price (MIP) on 66 steel products for a period of two months as against 173 items earlier. The move has evoked a sharp reaction from engineering exporters as it makes their input costs high and renders them uncompetitive in the global market.

The CNX Nifty is currently trading at 8599.05, down by 79.20 points or 0.91% after trading in a range of 8597.40 and 8690.10. There were 6 stocks advancing against 45 stocks declining on the index.

The top gainers on Nifty were Adani Ports & Special Economic Zone up by 5.07%, TCS up by 0.67%, NTPC up by 0.19%, Bharti Airtel up by 0.11% and Bajaj Auto up by 0.09%.

On the flip side, Grasim Industries down by 6.00%, Lupin down by 3.38%, ACC down by 2.20%, IndusInd Bank down by 2.20% and ICICI Bank down by 2.14% were the top losers.

The Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 0.98 points or 0.06% to 1,672.69, KOSPI Index increased 1.18 points or 0.06% to 2,044.96, Taiwan Weighted increased 22.75 points or 0.25% to 9,177.83, Nikkei 225 increased 34.46 points or 0.21% to 16,799.43 and Hang Seng increased 107.93 points or 0.48% to 22,573.54.

On the other hand, Jakarta Composite decreased 30.54 points or 0.56% to 5,409.75 and Shanghai Composite decreased 3.08 points or 0.1% to 3,022.60.