Benchmarks continue weak trade; Nifty below 8,800 mark

Indian equity benchmarks continued their weak trade in the late morning session on account of selling in frontline blue chip counters tracking lackluster trade across the globe and as investors geared up for two key central bank meetings. All eyes are now on the central banks this week, with the US Federal Reserve’s two-day meet starting on Tuesday and the Bank of Japan meeting on the same day. The sentiments were under pressure after the rupee opened lower against US Dollar as against the previous close of 66.95 per dollar. However, the downside was capped with global rating agency S&P projecting India to clock 8% growth over next few years and stating that India’s structural reform agenda has maintained strong momentum and should propel growth higher. The street also got some sign of relief with the Finance Ministry setting at rest confusion over levy of excise duty and stating that there is no ‘legal infirmity’ in the notifications issued by the government with regard to the GST Constitution Amendment Act. Traders were seen piling up positions in Oil & Gas, PSU and Metal stocks, while selling was witnessed in Realty, IT and TECK sector stocks. Aviation stocks displayed a mixed performance on reports that domestic air passenger traffic increased by 23.98 percent during August to 83.81 lakh, further the data from Directorate General of Civil Aviation (DGCA) showed that the passenger traffic during January-August period grew by 23 percent. In scrip specific development, Jubilant FoodWorks was trading in red after the company’s CEO Ajay Kaul announced his resignation with effect from March 31, 2017.

On the global front, Asian shares edged lower as investors nervously waited on the outcomes of the meet. Chinese Premier Li Keqiang stated that the Chinese yuan’s exchange rate will stay basically stable at a reasonable and balanced level and there is no basis for a sustained devaluation of yuan. Back home, the NSE Nifty and BSE Sensex were trading below the psychological 8,800 and 28,600 levels respectively. The market breadth on BSE was positive in the ratio of 1109:1039, while 134 scrips remained unchanged.

The BSE Sensex is currently trading at 28561.98, down by 72.52 points or 0.25% after trading in a range of 28517.70 and 28698.81. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.26%, while Small cap index was up by 0.10%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 0.60%, PSU up by 0.35% and Metal up by 0.15%, while Realty down by 0.98%, IT down by 0.72%, TECK down by 0.62%, Capital Goods down by 0.29% and Bankex down by 0.29% were the losing indices on BSE.

The top gainers on the Sensex were ONGC up by 1.54%, Dr. Reddy’s Lab up by 1.09%, Maruti Suzuki up by 1.08%, Cipla up by 1.05% and Lupin up by 0.82%.

On the flip side, Hero MotoCorp down by 1.67%, Adani Ports & Special Economic Zone down by 1.30%, Infosys down by 1.19%, Bajaj Auto down by 0.85% and TCS down by 0.80% were the top losers.

Meanwhile, world's leading provider of independent credit ratings, Standard & Poor's (S&P) Global Ratings,  in its latest report titled ‘APAC Economic Snapshots--September 2016’ projected that India will clock a steroid-free growth of 8% over the next few years, backed by broadening of domestic consumption base. The report stated that India’s structural reform agenda has maintained strong momentum and should propel growth higher.

S&P said that country's structural reform agenda has maintained strong momentum, most recently with the Goods and Services Tax (GST) passage, and should propel growth higher. It also said that inflation remains a risk, given the large weights on food, fuel, and other volatile items in the Reserve Bank of India's (RBI) target basket.

The latest gross domestic production (GDP) data showed that India's growth slowed to 7.1% in the April-June quarter, from 7.9% in January-March period. Besides, RBI too has said that the near-term growth outlook for India seems brighter than last fiscal and the economy is likely to expand at 7.6% in 2016-17.

The CNX Nifty is currently trading at 8783.45, down by 24.95 points or 0.28% after trading in a range of 8767.45 and 8816.45. There were 22 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were ONGC up by 1.51%, Cipla up by 1.04%, Dr. Reddy’s Lab up by 1.02%, Maruti Suzuki up by 0.97% and Aurobindo Pharma up by 0.89%.

On the flip side, Hero MotoCorp down by 1.92%, Adani Ports & Special Economic zone down by 1.48%, Infosys down by 1.25%, Kotak Mahindra Bank down by 1.10% and Bajaj Auto down by 0.98% were the top losers.

The Asian markets were trading mostly in red; Hang Seng decreased 42.28 points or 0.18% to 23,508.17, Nikkei 225 decreased 32.33 points or 0.2% to 16,486.96, Jakarta Composite decreased 15.21 points or 0.29% to 5,306.64, Shanghai Composite decreased 3.61 points or 0.12% to 3,022.44 and FTSE Bursa Malaysia KLCI decreased 3.2 points or 0.19% to 1,648.51.

On the other hand, KOSPI Index increased 6.77 points or 0.34% to 2,022.55 and Taiwan Weighted increased 13.42 points or 0.15% to 9,166.30.