Markets continue to trade in red amid weak Asian cues

Indian equity benchmarks continue to trade in red territory in afternoon session as investors awaited cues on whether the Federal Reserve would raise U.S. interest rates this year. Sentiments remain subdued with the private report indicating that achieving a 4 per cent inflation target in the near term seems unlikely, largely due to spike in prices of food and non-food items and the August CPI numbers are expected to be in the range of 6.1-6.3 per cent. Sentiment also remained edgy ahead of the expiry of the derivative contracts on Thursday. However, the gains in IT, TECK, Consumer Durables, Metal and Realty stocks provided support to the domestic equity benchmarks. In scrip specific development, ONGC and Cairn India dropped over 1 percent each after oil prices fell more than 3 percent overnight on signs of oversupply in the global energy market.

On the global front, Asian market were trading mostly in red, tracking the lackluster cues from Wall Street as well as weaker commodity prices overnight. Back home, the BSE Sensex is currently trading at 27967.28, down by 18.26 points or 0.07% after trading in a range of 27928.63 and 28028.98. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.16%, while Small cap index was up by 0.23%.

The top gaining sectoral indices on the BSE were IT up by 1.92%, TECK up by 1.55%, Consumer Durables up by 0.14%, Metal up by 0.10% and Realty up by 0.06%, while Oil & Gas down by 1.27%, Capital Goods down by 0.96%, PSU down by 0.77%, FMCG down by 0.76% and Power down by 0.26% were the losing indices on BSE.

The top gainers on the Sensex were Infosys up by 2.36%, TCS up by 1.87%, GAIL India up by 1.15%, Wipro up by 0.86% and Adani Ports &Special up by 0.63%. On the flip side, Bajaj Auto down by 1.41%, ITC down by 1.30%, Larsen & Toubro down by 1.15%, Sun Pharma down by 0.97% and ICICI Bank down by 0.85% were the top losers.

Meanwhile, India’s oldest and largest independent think tank, National Council of Applied Economic Research’s (NCAER’s) Business Confidence Index (BCI) registered a sequential increase of 2.2% in June quarter of 2016-17, mainly driven by improvement in perception about economic conditions and financial position of firms in the next six months.

The NCAER in its 97th round of Business Expectations Survey (BES) has said that the increase in BCI was helped by improvement in sentiment in two out of its four components. BES tracks the business sentiment of over 500 Indian companies to compute the composite BCI. The think-tank said that BCI is developed on the basis of responses to four questions, of these two are devoted to macro factors and the other two to micro. It said sentiment about the component like present investment climate is positive and remained largely unchanged. However, perception on the metrics as capacity utilization is close to or above optimal level showed a decline.

NCAER stated that firms were more optimistic about future economic conditions than about the present economic situation. Further it stated that all enterprise groups barring those with an annual turnover of less than Rs 1 crore declined by 9.1% show an increase or no change in BCI between April and July 2016. Firms with annual turnover of Rs 1-10 crore, Rs 100-500 crore and more than Rs 500 crore registered significant rise in BCI, whereas firms with an annual turnover of Rs 10-100 crore showed no change between the two rounds. The maximum growth of 8.1% was witnessed in the case of firms with an annual turnover of Rs 100-500 crore.

The CNX Nifty is currently trading at 8623.55, down by 5.60 points or 0.06% after trading in a range of 8608.00 and 8635.85. There were 23 stocks advancing against 28 stocks declining on the index.

The top gainers on Nifty were HCL Tech. up by 2.60%, Infosys up by 2.33%, TCS up by 1.90%, Tech Mahindra up by 1.09% and GAIL India up by 0.97%. On the flip side, BHEL down by 3.23%, BPCL down by 3.16%, ITC down by 1.36%, Tata Motors - DVR down by 1.30% and Bajaj Auto down by 1.28% were the top losers.

The Asian markets were trading mostly in red, Nikkei 225 decreased 100.83 points or 0.61% to 16,497.36, Hang Seng decreased 83.65 points or 0.36% to 22,914.26, Jakarta Composite decreased 51.36 points or 0.95% to 5,375.81, FTSE Bursa Malaysia KLCI decreased 4.02 points or 0.24% to 1,687.05 and Shanghai Composite decreased 3.81 points or 0.12% to 3,080.99. On the flip side, KOSPI Index increased 7.77 points or 0.38% to 2,049.93 and Taiwan Weighted was up by 49.12 points or 0.55% to 9,030.93.