Benchmarks turn red in early deals; Nifty holds 8,700 mark

Indian equity benchmarks have entered into red terrain in early deals, after making firm start, as traders remained concern with reports that in September, rainfall fell 15 per cent below average which could mean the season will end up in deficit. Sentiments also remained dampened with report that foreign institutional investors were net sellers in equities worth Rs 477 crore on Wednesday, as per provisional stock exchange data. However, traders were getting some comfort with report that Prime Minister Narendra Modi has reviewed preparations for roll out of the new Goods and Services Tax (GST) regime, possibly from April 1 next year, with Finance Minister Arun Jaitley and his team making a presentation on the milestones achieved and the road ahead.

On the global front, Asian markets were trading mostly in red at this point of time with some of the indices in the region are down by over half a percent led by the Japanese market, as the yen gained and gold edged higher following gains in US Treasuries. The US markets made a mixed closing in last session, the trade remained lackluster and the major averages moved to the upside early in the session but showed a lack of direction as the day progressed.

Back home, telecom stocks were buzzing in morning trade after Anil Ambani-led Reliance Communication agreed to merge its wireless telecom business with Aircel to create India's third biggest telecom operator in terms of subscriber base. Infra stocks were reeling under pressure despite report that government may soon coming up with an ambitious Rs 3-lakh-crore Economic Corridor project to develop 35,000 km of highways for faster movement of freight.

The BSE Sensex is currently trading at 28342.28, down by 29.95 points or 0.11% after trading in a range of 28340.37 and 28432.74. 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 0.06%, while Small cap index was up by 0.48%.

The few gaining sectoral indices on the BSE were Realty up by 0.88%, FMCG up by 0.67% and Consumer Durables up by 0.39%, while Bankex down by 0.41%, IT down by 0.33%, TECK down by 0.32%, PSU down by 0.31%, Oil & Gas down by 0.24% were the losing indices on BSE.

The top gainers on the Sensex were Cipla up by 1.59%, Adani Ports &Special up by 1.34%, ITC up by 1.23%, Sun Pharma up by 0.85% and HDFC Bank up by 0.67%. On the flip side, Hero MotoCorp down by 1.85%, Axis Bank down by 1.69%, Tata Steel down by 1.02%, Bajaj Auto down by 1.01% and Power Grid down by 0.95% were the top losers.

Meanwhile, global law firm Reed Smith in partnership with Mergermarket, in its latest report titled 'Taking Stock: Going Public in Volatile Times' stated that businesses in Asia are confident that initial public offering (IPO) activity will see an upsurge in the coming year. The report is based on the survey of 100 C-level executives, across Asia pacific, North America and Europe. All 100 companies are considering IPO in next three years.

According to the survey 44% of Asia-based respondents expect IPO markets to return to last years' highs within a year, 11% believe markets will rebound within six months, while none expect a rebound in other regions. However, survey respondents also show caution with 70% saying the recent turmoil in Chinese equity markets has influenced their IPO strategy.

The report stated that when it comes to post-IPO challenges, 59% of survey respondents cited greater public scrutiny among their top three reservations, while nearly half that is 49% concern about their stock being subject to market volatility ranked in the top three. The report added that short-termism, shareholder pressure and the risk of litigation also ranked high in the list of reservations about being a publicly listed company. Further, Global IPO volume has fallen 38% to just 339 in the first six months of 2016, from the first half of 2015 with a total of 544.

The CNX Nifty is currently trading at 8715.40, down by 11.20 points or 0.13% after trading in a range of 8714.95 and 8749.20. There were 22 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Cipla up by 1.63%, BHEL up by 1.57%, Aurobindo Pharma up by 1.49%, Adani Ports & Special up by 1.49% and GAIL India up by 1.24%. On the flip side, Yes Bank down by 2.76%, Hero MotoCorp down by 1.89%, Ultratech Cement down by 1.25%, Axis Bank down by 1.19% and Tata Steel down by 1.07% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 declined 201.81 points or 1.21% to 16,412.43, Taiwan Weighted decreased 38.53 points or 0.43% to 8,902.30, Shanghai Composite shed 20.66 points or 0.68% to 3,002.85 and FTSE Bursa Malaysia KLCI was down by 6.16 points or 0.37% to 1,655.23. On the flip side, KOSPI Index increased 7.88 points or 0.4% to 1,999.36, Jakarta Composite gained 51.19 points or 0.99% to 5,197.23 and Hang Seng was up by 132.2 points or 0.57% to 23,322.84.