Weak trade persist in late afternoon session

Indian markets continued their choppy trade in late afternoon session as investors cut down their bets after wholesale inflation soared to a 23-month high of 3.55% in July. Sentiment also remained down beat with the country's merchandise exports decline 6.84% from a year earlier in the month, after a marginal rise in June. Weak trend in the global market too weighed on sentiment. European stocks were lower as investors paused for breath after fresh record closing highs in US equities failed to boost investor sentiment in Europe and Asia. Back home, in scrip specific development, Power Grid Corporation were trading higher after the company reported 32.90% rise in net profit at Rs 1807.77 crore for the quarter ended June 30, 2016 against Rs 1355.64 crore in the corresponding quarter a year ago.

The BSE Sensex is currently trading at 28006.16, down by 146.24 points or 0.52% after trading in a range of 27942.65 and 28199.10. There were 11 stocks advancing against 18 stocks declining on the index, while 1 stock remained unchanged.

The broader indices were trading mixed; the BSE Mid cap index was up by 0.34%, while Small cap index was down by 0.09%.

The top gaining sectoral indices on the BSE were Metal up by 0.86%, Power up by 0.76%, PSU up by 0.75%, Oil & Gas up by 0.73%, Capital Goods up by 0.65%, while Consumer Durables down by 1.43%, TECK down by 1.41%, IT down by 1.37%, Auto down by 0.79% and Realty down by 0.56% were the losing indices on BSE.

The top gainers on the Sensex were Cipla up by 5.05%, Adani Ports &Special up by 4.62%, Power Grid Corpn. up by 2.16%, Larsen & Toubro up by 1.05% and SBI up by 0.88%. On the flip side, Sun Pharma Inds. down by 2.16%, Tata Motors down by 1.94%, TCS down by 1.93%, HDFC down by 1.91% and Bharti Airtel down by 1.57% were the top losers.

Meanwhile, index of industrial production (IIP) growth surged to 2.1% in June as compared to 1.1% in May, but remained much below the 4.2% growth reported in June 2015. Industrial output growth was lower on account of poor show by the manufacturing sector and contraction in capital goods production. On cumulative basis, the factory output in the April-June quarter grew by 0.6% compared to 3.3% growth in the year-ago period.

According to the data released by the Ministry of Statistics and Programme Implementation,central Statistics Office (CSO) IIP, with base 2004-05 for the month of June 2016, the Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month stood at 127.3, 191.3 and 198.9 respectively with the corresponding growth rates of 4.7%, 0.9% and 8.3% as compared to 121.6, 189.5, 183.7 respectively in June 2015. For April-June 2016, this sector’s output over the corresponding period of 2015 has been 2.3%, (-) 0.7% and 9.0% respectively.

The capital goods output registered a steep decline of 16.5% in June over a contraction of 2% in last year. In April-June, the production of these goods, which are considered as barometer for investment, declined by 18% compared to a growth of 2% in year ago period. Growth in output of consumer durables decelerated to 5.6% in June compared to 16.1% a year ago. The consumer non-durable goods also recorded low growth of 1% in June compared to 2.3% a year ago. Overall, consumer goods production recorded a growth 2.8% in June compared to 7.2% a year ago.

In terms of industries, 18 out of 22 industry groups in the manufacturing sector showed positive growth during the month of June. As per Use-based classification, the growth rates in June 2016 over June 2015 were 5.9% in Basic goods, (-) 16.5% in Capital goods and 6.1% in Intermediate goods. The industry group Radio, TV and communication equipment & apparatus showed the highest positive growth of 15.8% followed by 8.8% in Motor vehicles, trailers & semi-trailers and 8.7% in Other transport equipment.

The CNX Nifty is currently trading at 8619.25, down by 52.90 points or 0.61% after trading in a range of 8600.45 and 8682.35. There were 18 stocks advancing against 33 stocks declining on the index.

The top gainers on Nifty were Cipla up by 5.20%, Adani Ports &Special up by 4.34%, Hindalco up by 4.03%, BPCL up by 2.87% and Power Grid Corpn. up by 2.61%. On the flip side, Bharti Infratel down by 4.38%, Tata Motors - DVR down by 2.42%, Tech Mahindra down by 2.28%, Grasim Industries down by 2.23% and Bosch down by 2.23% were the top losers.

Asian market were trading mostly in red; Nikkei 225 decreased 273.05 points or 1.62% to 16,596.51, Taiwan Weighted declined 38.15 points or 0.42% to 9,110.36, Hang Seng was down by 21.67 points or 0.09% to 22,910.84, Shanghai Composite dropped 15.16 points or 0.49% to 3,110.04, KOSPI Index decreased 2.71 points or 0.13% to 2,047.76.on other hand, FTSE Bursa Malaysia KLCI increased 8.9 points or 0.53% to 1,699.23, Jakarta Composite increased 49.33 points or 0.93% to 5,369.89.

European markets were trading in red; Germany’s DAX decreased 102.03 points or 0.95% to 10,637.18, France’s CAC decline 40.05 points or 0.89% to 4,457.81, UK’s FTSE 100 decreased 28.93 points or 0.42% to 6,912.26.